Don't use the experts and don't trust the crowd
Jinfo Blog

By Tim Buckley Owen

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To judge from research commissioned by Hewlett Packard, you’d be forgiven for thinking that the sky was falling in on corporate information management. But since people do seem to be turning to less conventional sources for their external information, there are implications for what goes on in-house.

When a purveyor of solutions like HP commissions research to show that information management for the enterprise is “at breaking point”, you might be forgiven for suspecting some self-serving purpose. But Coleman Parkes Research is a respectable market research firm with a string of blue chip technology clients, and its findings, reported by HP certainly give pause for thought.

Even though information management is now an enterprise-wide imperative there’s no single owner of information. Almost half of the enterprises Coleman Parkes polled still leave it to IT and over a third to the chief executive or directors.

Seventy percent of companies don’t have a holistic approach to managing information, almost three quarters don’t have a proper information protection policy, and only 18% are planning to implement one. Yet a holistic policy become even more urgent when you start to look at where some knowledge workers are getting their business-critical external information from.

Wildfire PR’s job is to put their clients’ high tech products in front of potential customers. Wildfire’s survey of how IT decision makers researched business purchases found that they tended to use search engines and online news sources before the traditional IT industry press – but that their most popular medium, cited in 58% of cases, was social networks and online communities.

Indeed, given a critical mass, it seems that you can make social media do pretty much anything for you these days – like predict stock trends for instance. Economists at the Technical University of Munich have discovered that recommendations on Twitter can sometimes lead stock market sentiment by a day.

Analysing a quarter of a million Tweets related to Standard & Poors 500 listed companies over six months, they discovered that if investors had orientated their share purchases accordingly, they would have achieved an average rate of return of up to 15%. Indeed, the project has given rise to a website that exploits the phenomenon, TweetTrader.net.

That’s fine as long as the herd instinct proves correct. But some simple tests, carried out recently by the Economist magazine, and based on figures from investment researcher Morningstar, suggest that the crowd is usually “more foolish than wise”.

This is all challenging stuff for corporate info pros. The information management hole should just be waiting for them to fill it – but when it comes to using external sources to inform internal decisions, the days of the safe certainty seem to be gone forever.

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