What are the Differences Between Data And Information?

If you know how to manage data and draw information from it, you can clearly gain a competitive edge in your business and improve efficiency across departments. The article covers the most important differences between data and information.

“If you cannot measure it, you cannot manage it”. This phrase can be perfectly applied to data. The terms data and information are often used interchangeably. However, there is a subtle difference between these two. In this digitized world, you would need to understand both terms clearly. In this article, we discuss the main differences between data and information. 

What is Data?

Data is raw, unorganized, and unrelated. Its usability is only after processing. It is the smallest semantic unit, corresponds to primary information elements, and is irrelevant when making decisions. Data can come from any external or internal sources. It is usually objective, subjective, qualitative or quantitative, etc.

Let’s understand this with an example. We can call the facts and numbers that researchers collect as data. This data is meaningless unless the researchers subjected them to analysis. Data lacks any purpose unless it is converted into information.

Read More- Types of Data Every Aspiring Data Scientist Must Know About

What is Information?

Information is a set of data processed in a meaningful way as per the requirements. We need to process, structure, and present the information so that it helps in decision-making. It provides meaning to the data and improves its reliability while reducing the uncertainty that often arises because of raw and unstructured data.

Here, I would like to share a few examples to help you understand –

• Imagine a scenario where you are a website owner and tracking website analytics. You are getting traffic from different countries like the US, UAE, and India. This information is data. Information is finding out that traffic from UAE is decreasing and from the US is increasing.
• The data would be the ingredients in the culinary world, and the information will be the final dish.
• In the construction industry, the data would be construction materials, and the information would be the house.

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Data vs. Information

Below are some major differences between these two basis different parameters.

	Data	Information
Definition	It is a set of characters, symbols, and numbers that require processing	Information is processed and structured data, which is valuable and contextual
Format	Exist in the form of characters, letters, digits, and symbols	Follows the format of references
Structuring	Can be structured as –   1. Tables 2. Graphs 3. Data tree	Structured as –   1. Insights 2. Ideas 3. Thoughts 4. Languages
Making Decisions	Data in its original form can’t support decision making	Information is self-sufficient to help in decision making
Dependency	Independent of information	Depends on data
Feature	Data is raw and doesn’t represent any meaning	Represents logical meaning derived from data
Unit	Representation is based on binary digits – Bits and Bytes	Can be represented as time, quantity, etc.
Flow	Data flow is absolute	Information requires a definite flow
Usefulness	Data is raw and discreet and it doesn’t communicate any insights	Information communicates insights, impacting decision-making and user behavior
Meaning	It is not much reliable	Much reliable. It allows users to draw conclusions

Transforming Data into Information

By adding value to data, we can transform it into information. Below are the 5Cs of transforming data into information –  

• Contextualizing: Identify the context and the reason for the curation and creation of data in the first place
• Categorizing: Identify the units of measurement that help interpret them are known.
• Calculating: Process the data mathematically or statistically.
• Correcting: Eliminate any bugs and data issues.
• Condensing: Summarize the data more concisely.

Information = Data + Context (added value) + Utility (reduced uncertainty) 

Must Read – Objects and Data Types in Python

To Summarize

Data is a term that refers to facts, events, transactions, etc., that have been recorded. It is the raw input from which the information is produced.

Information refers to data that has been processed and communicated in a way that the recipient can understand and interpret.
As we have already pointed out, the data itself is worth nothing. It needs to be translated and transformed into information. Thus, the information is the final result through which decisions are made. As HBR suggests, it is crucial to use data to derive information.

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