THE IMPORTANCE OF “PERFECT INFORMATION”

Information has many characteristics that govern its value. Information is “perfect”
when all these characteristics are not just optimized, but have reached theoretically
ideal limits. Important information characteristics include:
•
Accuracy.
Accuracy determines the credibility of the information. Is it
correct? If it is a measurement, is it from a working, calibrated instrument,
and is the variation between measurements small enough to be inconsequential?
“Perfect information” is characterized as trustworthy, precise,
and actionable.

Timeliness.
Old information may not be actionable. Last year’s holiday
unit sales for personal computers may not have any relationship to the
inventory requirements for this year’s PC industry. If one producer bases
production on last year’s demand while another determines production
from current online orders, the timeliness of information will greatly favor
the second producer in determining production requirements. The world
of just-in-time manufacturing runs on accurate and timely information.
“Perfect information” is instantaneous and actionable.

•
Cost.
Many components determine the cost of information. The most
significant information costs are

1. Origination/access cost: How much does the information cost to obtain
and access? “Perfect information” is obtained at no cost.
2. Transmission cost: How much does it cost to get the information from
its source to its destination? “Perfect information” is transmitted at no
cost.
3. Searching cost: How much does searching for the information cost?
Depending on how information is organized, searching can be expensive
and time consuming. The advent of search engines has transformed
the slow linear search into a rapid direct access approach. “Perfect
information” is located at no cost.
•
Completeness.
Complete information provides the entire picture of the
endeavor in question. Partial information, even when accurate, timely, and
free, can leave gaps in understanding. Remember John Godfrey Saxe’s
poem about the six blind men believing they were describing the whole
elephant?

As each blind man laid hold of a different part (one man felt
the elephant’s side and confidently declared the beast to resemble a wall,
another grabbed the trunk and thought the elephant very like a snake, and
so on), their perception of the elephant was completely different. “Perfect
information,” unlike the reports of the blind men, reveals the entire elephant.
“Perfect information” is omniscient.

Consider what a great decision maker you would be with perfect information.
You would have trustworthy information, instantly, at no cost, from all possible
credible sources available.

In the history of information, the Internet provides a
closer approximation to perfect information than has ever been available to
humanity
— if only the Internet were completely credible and trustworthy! As things
are, you still have to separate the wheat from the chaff. The glut of information can
also be a problem as you seek information on simple endeavors and are swamped
with thousands of possibilities, many of which are not valid or relevant. But the
advent of the Internet, in combination with search engines like Google and Yahoo,
has permanently changed the way we access information and make decisions. From
linear to nonlinear, slow to instant, physical to virtual — the Internet has changed
information access, guiding it toward the “perfect” ideal. Orders of magnitude more
data are available today, in a timelier manner and at lower cost, than just 10 years
ago. This sudden, ubiquitous availability of nearly “perfect information” is more
important to the future of the fundamental organization of society at the dawn of the twenty-first century than the discovery and harnessing of electricity was to the
twentieth century.

The techonomic ramifications of “perfect information” are now taking effect.
Techonomic metrics,
used in concert with perfect information, allow the tracking of
trends in key endeavors. To observe techonomic effects in your endeavors, it is
important to understand the process used to create a techonomic metric.