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Introduction-

The basic
principles of organisational design include three fundamental areas: Data;
Information; and Knowledge. The importance of these three segments, in relation
to a business and its practice of collecting, interpreting and implementing
them is very significant. Data has three sub-categories: Structured Data;
Semi-Structured Data; and Unstructured Data. Information has nine key elements
that a business must adhere to which a business must take into consideration. Knowledge
has two separate forms, one of which is Tacit Knowledge and the other, which is
Explicit Knowledge. “Data are symbols that represent the properties of objects
and events. Information consists of processed data, the processing directed at
increasing its usefulness”. (Ackoff: 1999). Knowledge
is conveyed through instructions. All these types of organisation design help
to improve businesses effective output.

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For the second section of the
assignment, the key focus will revolve around Amazon and how they manipulate
data to benefit their organisation; the different types of information and
knowledge characteristics that they use effectively; and any improvements that should
be integrated into the way in which they do this.

 

 

Explain the basic principles of organisational design.

Data-

Data could be defined as the “facts
and statistics collected together for reference and analysis”. (Oxford
Dictionaries | English, 2017). In relation to
business systems, the data that is collected is raw, which means that it does
not have any underlining meaning and its significance is non-existent. Only
when the data is transformed into information and knowledge does it truly have
any meaning that is of any relevant importance. There are three different types
of data: Structured Data, Semi-Structured Data and Unstructured Data. (Kayas, 2017)

Structured
Data-

Structured Data is the most organised form of data, which
makes it easier to be recognised by computers.
This is because the data is defined before it is collected, which enables the
computer systems to swiftly differentiate them into their separate categories,
such as Numerical Values; Currencies; Addresses; Names; Dates and Times.

The importance of Structured Data is that it
would enable an organisation to
precisely monitor and regulate the data that has been collected. This is a
crucial benefit of Structured Data because it simplifies the data and so makes
it much easier to comprehend. In addition, it allows the computer systems to
abruptly find the relevant data, upon the request of the user. For instance, if
the user wanted to look at all the data that has been categorised into the
‘Numerical Value’ type of Structure Data, then it would locate all the relevant
sources.

An organisation may use Structured Data on their websites
if they have an E-commerce section. The reason for this is that the business
would need to collect the personal data of the customer, such as their Name;
Address; and bank details which would be displayed as Numerical Values. Once
the customer has entered in these specific details, the computer system would
be able to either accept or decline the order purchase and keep track of the
data for future references, such as the customer wanting to check whether their
order has been successfully submitted or if it has been declined.

Semi-Structured Data-

According to Datamation “Matthew Magne, Global Product
Marketing for Data Management at SAS, defines semi-structured data as a type of data that
contains semantic tags, but does not conform to the structure associated with
typical relational databases”. (What is Semi-Structured Data – Datamation, 2017)

Due to this, Semi-Structured Data
falls into the middle of Structured Data and Semi-Structured Data. This is
because it contains an element of both Structured and Unstructured Data. Semi-Structured
Data is important because it enables things such as Emails to work properly.
The reason for this is that an Email would contain elements that fit into the
Structured Data category, such as the name of the recipient and the sender. However,
it would also contain images and videos, which fall into an Unstructured Data
category. Due to this, it is important for machines to be able to recognise and
understand Semi-Structured Data so that they can display all the contents of an
Email.  

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Unstructured
Data-

Unstructured Data refers to the
type of data that does not fit into any predefined database and is usually full
of text, but it could also contain numerical values, images and videos.
Statistically, Ninety-Five Percent of all new data is in this form, and so it
is significant. (Kayas,
2017)

Unstructured Data is crucial
because it enables individuals and organisations to produce different types of
documents and content, which could be used to positively affect a business and
the way in which it operates, or communicates with its customers. For example,
a company such as Instagram would benefit greatly from this type of data that
is collected, because there are millions of images posted on the platform on an
hourly basis. In fact, as of September 2017, there are a recorded five hundred
million daily active users that post and ‘like’ content on the platform. (Instagram daily
active users 2017 | Statistic, 2017)

Information-

Information
refers to the Data once it has been processed. It is given a specific context
and now has a direct meaning, rather than just existing as Raw Data. Information
should be nine things once it is given meaning. They are: Accessible; Accurate;
Complete; Economical; Relevant; Reliable; Secure; Timely; and Verifiable. To
expand on a few, by ‘Accessible’ it means that the information should be able
to be easily viewed by the users. ‘Complete’ refers to the information
containing all the crucial facts so to ensure the correct information is given.
‘Reliable’ means that the information that is provided is trusted by the users
and the business ensure that the information that is being put out there is of
dependable sources. (Kayas, 2017)

Knowledge-

Knowledge
is defined as “Facts, information, and skills acquired through experience or
education; the theoretical or practical understanding of a subject” (knowledge | Oxford English Dictionaries, 2017). It is
an impalpable asset and so does not exist in physical form. There are two
different types of knowledge: Tacit knowledge and Explicit Knowledge.

Tacit
Knowledge-

Tacit Knowledge is subjectively personal,
relates to a specific context, and is quite difficult to communicate in a
formalised manner. An example of this is when an individual possesses
methodological expertise in a specific dexterity. This would be difficult to
communicate to other people because they have not got the same level of
education in that field, whether it is something such as mechanical engineering
or even flying aircrafts.

Explicit
Knowledge

Explicit Knowledge is impersonal,
can be easily gathered and organised before it is transferred, and is simple to
share. (Kayas,
2017). “The majority of explicit
knowledge is specialized or academic data or information which is defined in
formal language, like manuals, mathematical expressions, copyright and patents”.
(Explicit
Knowledge, Examples, 2017). A common
example of Explicit Knowledge is ‘how-to videos’ which clearly demonstrate in a
clear and concise manner how to correctly do something, for example, setting up
a new computer correctly.

Identify the need for integrated information systems.

Amazon is
an E-commerce business that was founded by Jeff Bezos in July 1994. It is
currently one of the largest and most successful online retailers and is also
the second greatest private employers in the United States, with over half a
million employees. As a business, they collect data in various ways and use the
data that is collected to benefit the organisation.

 

The
current data manipulation practices-

An example of the type of data that
is collected by Amazon is User provided data such as names, email addresses and
phone numbers. This would fall into the Structured Data category as it is the
basic raw data that is needed for the user to be able to sign up with the business.
This is done by having a ‘sign up’ section on the official Amazon website.

Amazon also collect data on the
types of products that customers look at and what they purchase. This is done
using internet cookies, which monitor the different pages that the user visits
and the products that they buy. This is a very significant type of data for
Amazon because it shows them which products have the most demand, and so they
can ensure that they provide these types of products. Also, the use of internet
cookies means that the algorithm that is set by Amazon can recommend products
to the user, based on the types of products they have viewed in the past. This
often leads to the customer purchasing the recommended products, which
immensely benefits the profit margins of Amazon. Amazon’s use of data manipulation
is intelligently advantageous, and it is evident that they exploit the data
that is collected to enhance the users experience with the business, which is emphasised
by their market share value, which is continuously on the rise. (Forbes Welcome,
2017)

The
information required by the company for its operational and strategic
activities-

The information that is required by
Amazon for its operational activities is the customers details, such as their
bank details and address. This type of information is integral in ensuring that
Amazon can efficiently complete transactions and fulfil deliveries. The
customers put their trust into the organisation to keep these personal details
secure, and the business in turn expect that the details that have been provided
are accurate, so to avoid any problems when processing the purchase orders.
This is a crucial process so to minimise the prolongation of having to track
down orders if they have been sent to the wrong address, or having to refund
purchases charged to the incorrect bank account. Due to this, it is essential
that the Information that is collected is accurate and complete.

The Information that is required
for Amazon in terms of its strategic activities is the data that shows the
specific products that are frequently bought by the customers, and the
fluctuation between the demand for certain products. This would enable Amazon
to understand when they should actively promote a product, so to raise
awareness around it because it is in demand, and so they would want to converse
to the customers that there is an offer on that product. This would generate a
lot of sales in relation to the demand of the product, increasing the profit
that is earned.

The
key knowledge characteristics required for the effective interpretation of the
information identified above-

There are various characteristics
that Amazon would need to efficiently interpret about the information that they
collect. For instance, by taking into consideration the consumer culture
patterns and how customers spend their money, such as whether they purchase
multiple products at a time, or only buy them individually, it would provide
Amazon with a basis of knowledge to determine whether they should increase
bundle purchase offers, or whether they should put prices down for individual
products. This is a key knowledge characteristic as it provides a clear insight
into which sales approach would be most effective to boost the sales achieved.

In addition, this knowledge must be
secured so to avoid Amazon’s rival businesses getting a hold of their customers’
spending habits. The purpose of this is so that other E-commerce retailers do
not exploit the information and use it to benefit their business because this
would have a negative effect on Amazon in terms of the sales that they achieve,
which could see quite a significant decline. This would decrease the market
share value that Amazon owns and could influence consumers to purchase products
from other businesses.

The
main improvements that are necessary for the organisation to improve its
performance in the future-

An improvement that could be made
by Amazon so to improve its performance is that they could introduce a tactic like
Tesco’s Clubcard scheme, which allows the customers to collect points on their
account and save them up to use on products in the future. This would encourage
people to shop with Amazon as they would be rewarded with points that can be
used to buy products for a cheaper price, or if they have enough points for the
product, regardless of price, they could purchase it completely off their
Amazon points.

Another improvement that could be
made to improve Amazon’s as a business is to ensure that their security is of
the greatest level. Although this did not happen to Amazon itself, in 2014,
Sony got hacked and customer account details were stolen. Amazon must ensure
that they have a strong security system for their website so that they do not
suffer the same attack. This type of attack could greatly damage the company
and immensely impact the businesses reputation. This is because the customers
want their personal details to be secure, and failure to do so would make consumers
feel as if Amazon has failed their privacy concerns. Therefore, it is
fundamental that Amazon have a secure defence in place to fight off any
possible cyber-attacks, so to ensure the security of private information from
being stolen.

Summary-

To conclude, Amazon effectively collect
data, which they use to benefit the company. It is very simple for users to
create an account with Amazon and set up their personal details such as their
name, address and bank details, which enables the process of purchase
transactions. This is vital information to ensure the order is delivered to the
correct address and charged to the precise accountholder. Amazon use the
information that is gathered efficiently to influence the organisation in terms
of promotional decisions that are made, in response to the demand of the
customers and in affiliation with the consumer spending patterns. This helps to
generate a greater amount of sales. Additionally, they must ensure that they
keep their customers’ records secure so to maintain their confidence. A
cyber-attack could drastically impact Amazon and this loss of data could be the
downfall for a business of the magnitude as Amazon. Moreover, the introduction
of a reward scheme like Tesco’s Clubcard would encourage consumers to spend
their money through this organisation, which could help to boost the market
share that is possessed by Amazon.

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