Surinder Batra: 3rd January 2007

Very often while teaching MIS or Knowledge Management or any other subject related to data, information and knowledge, one is expected to illustrate the difference between these terms. The literature seldom deals with the term “wisdom”, which naturally comes next in the hierarchy. The following example from the stock market investments of an individual, which also goes further to the level of wisdom, can come handy in providing a light-hearted illustration of the differences.  

Data: Isolated observations or attributes, e.g.:

• Individual quotes of various shares on the stock market

Information: Analyzed data of share prices, e.g.:

• Sensex gone up by 2% compared to the previous day
• Price of a specific share in my portfolio gone up by 3% from the previous day
• Price of another specific share (which I am watching for possible investment) gone down by 2%.

Knowledge:  Actionable information, e.g.:

• It is better to sell a share when the targeted appreciation has been achieved. This specific share can now be sold based on this criterion
• Identify under-valued shares with good potential and buy them when market is down. This specific share is worth buying now.

Wisdom: Insights distilled from experience, e.g.: 

• I burnt my fingers again!  I will never never invest in the stock market again!