From Data to Information, and Knowledge to Wisdom

By Tan Thai Soon

1.Introduction
There is a long tradition among writers and philosophers of distinguishing the meaning of "knowledge" from data, information and wisdom (Fahey and Prusak, 1998; Ackoff, 1989). The resulting classifications sometimes may be confusing, but it is important and necessary. As in the words of Fahey and Prusak (1998) "if knowledge is not something that is different from data or information, then there is nothing new or interesting in knowledge management."

2. Form Data to Information
In general, data can be described as symbols, or raw number and words. In itself, "data does not carry meaning unless one understands the context in which the data was gathered" (Godbout, 1999). On the other hand, information is "data endowed with relevance and purpose." To have any meaning, it must be processed within a context with purpose; thus "information extends the concept of data in a broader context" (Godbout, 1999)

3. From Knowledge to Wisdom
The meaning of knowledge is easy to understand, but difficult to define. In addition, the classification between information and knowledge can sometimes confusing. In the information age, it is often claimed that "we are being flooded by too much information, relevant and irrelevant" (Tan, 2010). In this respect, a definition of knowledge is that it is " information combined with experience" (Davenport, De Long and Beers, 1998) or " a fluid mix of framed experience, values and contextual information" (Davenport and Prusak, 1998). According to Alavi and Leidner (2001) "information is converted to knowledge once it is processed in the mind of individuals." It follows that, for it to become knowledge, information needs to be processed, only then can it be used to gain experience, up to date and use in the right context for the right purpose.

The final classification is "wisdom". According to Bellinger, Castro and Mills (2004) wisdom is " the process by which we can discern, or judge, between right and wrong, good and bad"; it relates to human consciousness of morality and ethics. As a recent example of its importance, it can be noted that U.S. financial systems possess the best information systems and the best knowledge workers in the world. However, the systems have proved not to be sustainable in the absence of "wisdom". In the absence of wisdom, "the greediness of U.S. subprime mortgage operators and hedge funds companies have brought otherwise good financial systems to near collapse" (Tan, 2010)

There was a lack of wisdom among both financial operators and financial regulators. Super profits and super payouts induced "Wall Street" bankers to purchase an excess of structured products from the subprime mortgage operators while lending excessively to hedge funds companies. As Alan Greenspan, has since confessed, his entire "intellectual edifice" has been "demolished" by recent events.

4. Summary
In summary, the progression in classification from data to wisdom shows differences in meaning and can be classified as a separate terms, but they are integral parts and inter-linked in the knowledge process. In other words, there must be basis data and information before these becomes knowledge through a "process".