ACCA Applied Skills · Performance Management
Uses and Control of Information for ACCA Performance Management
Uses and control of information covers how organisations turn data into useful information, who needs it, where it comes from, how technology such as big data and cloud computing changes it, and how it is kept secure and reliable. In PM you apply these ideas to short scenarios.
What this chapter covers
This chapter is about the information that managers use to plan, control and decide. You start with the difference between data, information and knowledge. You then see how management information systems serve strategic, tactical and operational managers, and where the information comes from, both inside and outside the business.
The second half deals with technology and control. Big data and data analytics change what a business can know. Cloud computing changes how it stores and processes that data. Data security, governance and information control deal with the risks: loss, misuse, error and breach.
This chapter links to the rest of PM in several ways. Costing, budgeting, performance measurement and decision-making all depend on good information. When you answer a variance or KPI question, you are using the ideas here: is the information relevant, timely, accurate and suited to the manager who reads it? Mostly the content is descriptive, so it suits objective test questions and short scenario-based written points.
This chapter has no calculations, so it is one of the easiest places to gain marks if you learn the definitions and can apply them to a scenario. Objective test questions are all or nothing, so you need precise knowledge, such as which level of management uses which type of information. The same ideas also support your written answers in Section C, where you may be asked to comment on information quality, systems or risks.
Uses and control of information: topics in the order to study them
- 1Data, Information and KnowledgeEvery later topic builds on these definitions, and you need to know what makes information good.
- 2Management Information Systems and Levels of ManagementOnce you know what information is, you learn who uses it and how its content changes by management level.
- 3Sources of Management InformationNext you look at where information comes from, internal and external, formal and informal, so you can judge reliability.
- 4Big Data and Data AnalyticsThis extends the idea of sources to very large, fast and varied data sets, and to the techniques used to analyse them.
- 5Cloud Computing and Information Technology DevelopmentsCloud and related developments explain how data is stored and processed, which sets up the risk discussion.
- 6Data Security, Governance and Information ControlYou finish with risks and controls, which draw on everything before and are often tested in scenarios.
How to prepare Uses and control of information
Treat this chapter as a vocabulary and application exercise. Learn the terms accurately, then practise tying each one to a business example.
- Read each topic once and write a one-line definition of every key term in your own words.
- Build short lists you can recall: qualities of good information, features of each management level, types of source, risks and controls.
- Make a simple table in your notes, not on the exam, that matches strategic, tactical and operational managers to the information they use, its time frame and its detail.
- For each technology topic, write one benefit and one risk for a business, so you can answer either side of a question.
- Do objective test questions on the chapter and review every wrong answer. Note whether the error was a definition or a misread scenario.
- Practise two or three short written answers where you must link a point to the scenario, not just list it.
- Return to your list of definitions the day before the exam and test yourself without notes.
Common mistakes in Uses and control of information
Treating data and information as the same thing.
Fix: Remember that information is data that has been processed and given meaning for a decision. Check whether the scenario describes raw figures or processed output.
Matching the wrong type of information to a management level.
Fix: Link level to time frame and scope. Strategic is long-term and broad; operational is short-term and detailed.
Writing generic answers about technology that ignore the scenario.
Fix: Pick the points that fit the business described and name the business activity they affect.
Listing only the benefits of big data or cloud computing.
Fix: Always pair each benefit with a matching risk or limitation, such as security, cost or data quality.
Confusing security with governance.
Fix: Security protects data from threats. Governance sets the rules, ownership and accountability for how data is managed and used.
Rushing objective test questions on this chapter because it seems easy.
Fix: Read every option carefully. Wrong answers are often partly true, and there are no partial marks.
Last-day revision: Uses and control of information
- Data is raw facts and figures; information is data processed so it has meaning for a decision; knowledge is information understood and applied through experience.
- Good information is relevant, accurate, complete, timely, understandable and cost-effective for its user.
- Strategic managers use summarised, mainly external, long-term and uncertain information.
- Operational managers use detailed, mainly internal, short-term and more certain information.
- Tactical managers sit between the two and use information to control resources and monitor performance.
- Internal sources include accounting records, payroll and production data; external sources include government, competitors and market research.
- Big data is often described by high volume, velocity and variety; some add veracity and value.
- Data analytics means examining data to find patterns that support decisions.
- Cloud computing gives on-demand access to shared computing resources over the internet, often at lower upfront cost.
- Cloud risks include reliance on the provider, loss of control over data and security concerns.
- Data governance sets who owns data, who may use it and the standards it must meet.
- Controls over information include access restrictions, passwords, encryption, backups and staff training.
Uses and control of information practice questions
- A manufacturing company moves its payroll software from servers it owns to a provider that supplies the software over the internet on a subs…
- A finance director is concerned about the risks of storing the company's management information with a public cloud provider. Which of the f…
- Dunmore Co's software development team currently buys servers and operating systems and builds its own test environments. It is considering …
- Wend Co's finance director receives a monthly report containing forty pages of detailed ledger listings, from which she must find the few it…
- Which of the following is a characteristic of good information as commonly set out for management use?
- A retailer with sharp seasonal peaks in online sales is evaluating cloud computing instead of buying more servers. Which of the following is…
- A retail chain records every till transaction as a line showing item code, quantity and price. A regional manager receives a weekly report t…
- A production manager at Karel Co has worked with the company's machines for twenty years and uses this experience, together with the weekly …
Uses and control of information in other exams
The same ground in other exams, if you are preparing for more than one or want another angle on it.
Uses and control of information: frequently asked questions
Is the uses and control of information chapter calculation-based?
No. It is descriptive, so you score by knowing definitions and applying them to a scenario. That makes it a good chapter for steady marks in objective test questions.
How should I study this chapter for the PM exam?
Learn the key terms first, then practise applying them to short business examples. Finish with objective test questions and a few brief written answers that link points to the scenario.
Can this chapter appear in the written section as well?
It can. Ideas such as information quality, systems, technology risks and controls can support written points in constructed response questions. Even then, you must tie your points to the scenario.
What is the difference between big data and data analytics?
Big data refers to very large and varied data sets that arrive quickly. Data analytics is the set of techniques used to examine such data to find patterns and support decisions.