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Sometimes the managing editor gets it very very right

Williams is a great firm, but the point is that unless organized, information is just data. To be meaningful, data must be organized. It is never clear, however, in what form certain kinds of information are most meaningful. The same information may be organized in different ways for different purposes. For example, in business, financial results are organized according to generally accepted accounting principles (GAAP) for the US Securities and Exchange Commission, in a different way for the Internal Revenue Service, with an eye on cost control and capital returns for internal purposes, and in the case of pro-forma accounting, a fourth way for presenting to shareowners.

We use different ways to organize data into information. I employ four of these routinely in my practice

The first organizing principle is the key event. The key event is one which effects a multitude of people or processes. Key events are the hinges upon which future performance depends. The key event may be technological, political, or procedural but the implications are usually significant and global. We are in a key event now, and anyone who thought the war in Iraq wasn't a key event (the rally is already built in theory) had their heads buried deep in the sand.

The second organizing principle is probability theory. Here we recognize that events and developments often vary within a range. As long as fluctuations stay within the normal probability distribution they are not noteworthy, they are data or noise, not information. But once events stray beyond the expected probability distribution, the data becomes information. Several data points in a row beyond 1.3sigma is when we start paying attention very very closely.

The third organizing principle is the threshold phenomenon. Emergence of new conditions is a natural property of complex adaptive systems. However, emergence of new conditions are difficult to detect until a certain threshold is reached. Contrary to conventional thinking, it is not the majority that sets a trend into motion, it is the minority, so we like to look for strong consensus conditions that have been held for some time - these are the places to look at what the minority is saying/doing because that is where the new trends will emerge.

The fourth organizing principle is the discontinuity. Whenever something unexpected or out-sequence occurs, the data may become information. Disconfirmation elevates certain data to information status. What doesn't happen is often more significant than what does. As Sherlock Holmes said "Yes Watson but what is curious is that the dog did not bark.."

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