Classification of types of Information

Types of Information:- Information is a processed form of data i.e. data that have been processed and shaped into a form that is meaningful to its users is known as information.

Davis and Olson have defined information as “ Data that has been processed into a from that is meaningful to the recipient and is of real or perceived value in current or prospective actions or decisions”.

Information can be classified in the following ways:

  1. Classification by Characteristics.
  2. Classification by Application
  3. Classification by Usage


  1. Classification by Characteristics

The following is the classification of information on the basis of its characteristics:-

Internal and External Information

  • Internal Information

Internal information is the information generated through the internal sources of an organization. Generally, it is historical or static in nature. It is aimed at identification of firm’s strengths and weaknesses. It includes.

  • Policies:- Long-term basic policies on product range marketing, finance and about personnel.
  • Sales forecast:- It guides all the internal plans of the firm.
  • Financial plan:- Information on financial or budget plan includes the information about allocation of total resources like employee, plant, materials, overheads, administrative expenses of the firm. It acts as an important link between all activities of the firm.
  • Supply factors:- Information concerning availability and limitation of supply factors such as labor, capital, plant and equipment’s is important as these factors play a vital role in developing the financial and subsidiary plans for achieving organization’s objectives.


  • External Information

External information is the information generated through the sources of data outside the organization such as government reports, industry surveys etc. It includes:

  • Government polices:- Information about government policies or financial and tax affairs, policies or financial and tax affairs, political stability etc. is required and may have a significant effect on future planning decisions.
  • Economic trends:– It includes information about:
  • Economic indicators like employment, productivity, capital investment
  • Prices and wage levels which affect all, regardless of product or services.
  • Technological environment:- The information on technological changes or advancements is necessary for forecasting the changes in the firm and their effects. It is also desirable to assess the effect of technical changes on new products and processes.
  • Factors of production:- These include information about the source, cost, location, availability accessibility and productivity of the major factors of production such as labour, materials and capital.

Action and Non-action Information

  • Action Information

The information which induces action is called action information. For Example: When the attendance of the student for a particular subject suddenly falls down 40%, it calls for immediate action. Another example is, ‘ No stock ‘ report calling a purchase action is action information.

  • Non-Action Information

The information which communicates only the status of a situation is called non-action information. For example: While watching a cricket match, you understand that the current run rate is 4 per over whereas the required run rate is 7 per over. You have this information but you can’t take any action about it. Thus, it is non-action information.


Recurring and Non-recurring Information

  • Recurring Information

The Information that is generated at regular intervals is called recurring information.

For example: The monthly sales reports, account statements, stock statements, trial balance etc.

  • Non-Recurring Information

The information that is non-repetitive in nature. For example: The financial analysis or the report on the market research study is non-recurring information.


  1. Classification by application

The following is the classification of information on the basis of its application:-

  • Planning Information

Certain standards, norms and specifications are used in planning of any activity. Hence such information is called the planning information. For example: The design standards, operation standards, time standards.

  • Control Information

Reporting the status of an activity through a feedback mechanism is called control information. When such information shows a deviation from a goal or the objective, it will induce a decision or an action leading to control.

  • Knowledge information

A collection of information through the library reports and the research studies to build up knowledge base as an information source for decision making is known as the knowledge information.


  1. Classification by Usage

The following is the classification of information on the basis of its usage:

  • Organization Information

When the information used by everybody in an organization, it is known as the organization information.

For example, Employee and payroll information is organization information used by everybody in the organization.

  • Database Information

When the following information has a multiple use and application, it is called the database information. For example: material specifications or supplier information is database information store for multiple users.

  • Functional\Operational information

When the information is used in the operations of a business, it is called the functional or operational information. For example: information like sales or production statistics is functional information.