Information Systems in Management Science—Concerning the Dangers of Little Knowledge

Information system analysts often say that information reduces or even eliminates uncertainty. This is supposed to be a good thing because uncertainty disagrees with the nervous system of executives, who recognize only two possible probability values: 0 and 1. That information reduces uncertainty is “scientifically proven” by invoking the Wiener-Shannon theory of information and the concept of entropy.

Now I find all this confusing or downright erroneous. Perfect information or complete knowledge—difficult, expensive, or well-nigh impossible to find—does eliminate uncertainty. But imperfect or little knowledge—a more practical commodity—does much more curious or subtle things.

One of the aims of information calculus advocated by this writer is to clarify and remove confusion in this field. So in this column I illustrate what imperfect information does, and show that the phrase “remove uncertainty” does not make good sense.