Digital Information Organism

A digital information organism is a new type of tool available to professional accountants which overcomes limitations encountered when trying to use electronic spreadsheets to automate certain mission critical processes.

The Structural Advantage: By separating the information and the “costume” that information wears (i.e. the document); representing the information as a graph which a computer based process can reliably interpret (i.e. treating these graphs as semantics-oriented structures known as models); organizations eliminate the traditional "human bucket brigade"; the fragile (and costly) practice of humans manually moving text from one document to another document. Instead, the model is the "code" which enables reliable automation.

If the gap between human interpretation and machine interpretation is eliminated; if we think beyond the document; if we give the dumb beasts a chance to succeed; if we leverage this structural advantage; mundane repetitive work can effectively handed off to machines.

To properly manage complexity, you need to understand complexity. Complecting "intertwines" or "braids" or "tangles" things so they become harder to understand and reason about;. Composing assembles things so they remain independent and understandable. Complecting things is a source of complexity.  Many electronic spreadsheets tend to be complected.  To complect is to intertwine things so they become tangled together. 

To compose is to assemble things into a coherent whole. Complecting leads to complexity. Complexity creates fragility. Composing leads to making things simple. Simplicity is a prerequisite for reliability.

Think "Legos"; specifically Legos of information.  Legos are composable. Legos are modular, standardized, portable, reusable, scalable, and can be precision components if implemented according to best practices. Plus; Legos are easy to use.  So how do you turn digital information into a Lego-like artifact that is reliable?  You achieve that by effectively managing "apparent complexity".

These Legos are infrastructure of modern accounting, reporting, audit, and analysis.  Accounts, auditors, and analysts will use these Legos to build modern accounting information system infrastructure. Then they will use their modern "shovels" (think human task performance) to refactor the office of the CFO.

Atomic Design Methodology is an approach to thinking about systems.  According to this methodology there are four building blocks explained using an analogy to constructing a house:

  • Atoms are basic fundamental building blocks or raw materials and are like 2 by 4s, bricks, cement, and rebar.  Atoms are the lowest level of "stuff" that you work with. Atoms are the basic unit of data.
  • Molecules are low level functional units which are made up of two or more atoms held together by a logical “bond”. Continuing with the metaphor of building a house, molecules are things like walls, doors, windows, roof, floor. Molecules are constructed from the atoms.  Molecules are the atoms arranged into slightly more complex and sophisticated structures (i.e. functional units) so that you don't have to work at the level of the atom. Molecules are the basic functional units of information.
  • Organisms are higher level compound units which are assemblies or groups or structures made up of molecules that form simple working subsystems. My core pattern, the information block, is an example of an organism.  Again continuing with the metaphor of building a house, an organism would be like the house itself. An organism is an assembly of (is composed of) molecules and is more than the sum of its parts.
  • Species are different types or categories of organisms. A species is like different types of houses which might be used for different purposes. Or you might see a "house" as a "physical structure" of some sort like maybe a garage, a warehouse, or a multi-story sky scraper. A neighborhood would be made up of different types of physical structures. A species provides flexibility.
And so it seems to me that the core pattern of information block is really a digital information organism.  The different types of molecules used to construct that digital information organism include the: (these are logical ideas or notions)
  • Element: An element molecule defines an idea or notion used by the information organism. An element may be primitive and therefore not decomposable or an element can be compound and decomposable into a set of primitive elements.  An example of primitive elements might be "assets”, “liabilities”, and “equity”. An example of a compound element might be “balance sheet” or "income statement".
  • Connection: Connections molecules describe permissible relations/associations between elements.  Connections assemble elements into composite units. An example of a connection is the statement "assets is part of the balance sheet" and "liabilities is part of the balance sheet" and "equity is part of the balance sheet".
  • Condition: A condition molecule is something that must always be satisfied. Conditions can be connected using logical connectors (e.g. AND, OR, NOT, NOR, IF) and are made up of logical operators (e.g. +, =, /, *. <, >, ^). An example of a condition is "Assets = Liabilities + Equity". Assertions, restrictions, constraints, and other such rules are conditions.
  • Fact: A fact molecule is a measurement or observation typically expressed with numbers and words. For example, a fact might be “assets for the consolidated legal entity Microsoft as of June 20, 2017 was $241,086,000,000 expressed in US dollars and rounded to the nearest millions of dollars". Note that a global open industry standard dimensional fact model is available.
A structure is a compound element, an organism, which is made up of primitive elements, connections, conditions, and facts. A structure can be projected into the set of connections, the set of facts, the set of conditions, the set of elements, or a rendering which enables a human to interpret and interact with the structure.

It seems that a species is the type of container that holds the organisms which are built using the molecules.  For example, a "financial statement" is one type of species, an "accounting working paper" is another species, an "audit bundle" is another species, and a "financial analysis model" is another species.

A report is a set of structures and also a holon.  A structure is a set of elements, connections, conditions, and facts and also a holon. Each element, connection, condition, and fact is also a holon. The details in some other digital information organism which connects to the summary in some other digital information organism are also both holons. A report is a machine which has a state, changes in state, events which explain the changes in state.

Encapsulation and this high level design model hides complexity from the user.  Agile, Lean, and Six Sigma principles, techniques, and philosophies such as poka yoke (mistake proofing) help keep quality ultra high.

The digital information organism lives; a new element is needed, a new connection, a new condition, new facts; each addition slots into an existing molecule. State exists, then events occur to change the state. The digital information organism is a living artifact.

A digital information organism is a living versioned artifact. How a user engages with that artifact depends on who the user is, what they are doing, where they are in that process, their stance with respect to the knowledge, and their required level of resolution.

Everything is information. All information is connected in context. Norms, conventions, and standards describe behavior patterns.  Everything operates within well understood and agreed to strict boundaries. Everything is graph first and designed to be easily interpretable by a machine but then that same graph (i.e. not a copy) can be projected into a human readable rendering. All this is particularly suited for the deterministic nature of financial information. Using these safe and powerful mechanisms, industrial processes can be created at scale. While particularly well suited for financial information, all this can also work for general business information. Everything is based on global open industry standards and embraces a modular open systems approach. End to end provenance and traceability.

And so where do the atoms come in? Atoms or the atomic level stuff is the technical syntax used to physically define the logical ideas or notions (i.e. atoms are the physical instantiation of the molecules within an implementation). For example, the following are all physical technical syntax: XBRL, RDF and the rest of the semantic web stack, labeled property graphs and the graph query language used to describe those graphs, common separated values (CSV) files, PROLOG.

The XBRL International Open Information Model (OIM), the Object Management Group Standard Business Report Model (SBRM), and my Seattle Method all provide aligned conceptualizations of a business report. Each uses specific physical technical format (the atoms).

Molecules, organisms, species, elements, connections, conditions, and facts are all logical ideas provided by this conceptualization. For more, please see the triangle of meaning.  Lots of work to figure this stuff out? You bet.  But that is what it takes to beat down complexity and create something elegant which is simple and easy to use.  It takes a lot of work to avoid creating a kludge.

Here is an example information organism on the top and a digital version of that same information organism below that: (you can have a look at the digital information organism here)


Atomic Design Methodology and the notion of the Holon are extremely helpful in explaining the conceptualization of the digital information organism. Leveraging a modular open systems approach (MOSA) can make this even more compelling. Connecting processes, projects, and workflows together using these digital information organisms make it even more compelling.  Putting all this together using a framework like the Zachman or TOGAF framework takes all this to another level.

Structure is the ultimate bridge. This is particularly true of a global open industry standard structure. Without a strict, standardized data structure, epistemic traceability collapses into a "human bucket brigade," where people are forced to manually copy and paste data across disconnected systems, introducing massive margins for error.

Additional Information:

Comments

Post a Comment

Popular posts from this blog

Reference Reporting Frameworks

Image
A financial reporting scheme is a purposeful arrangement of financial line items, totals, subtotals, aggregations, disaggregations, structures, metadata, categorization, classification, assertions, restrictions, constraints, other conditions, etc. A financial reporting scheme represented in a digital format should not be semantically impoverished. Leaving information out, consciously or unconsciously, is not desirable. These reference reporting frameworks provide the minimum of what is necessary. They are modest, not impoverished, yet not as secure as they actually need to be. The following are a set of reference reporting frameworks (a.k.a. reporting schemes, knowledge regimes) which helps those interested in understanding how to create an industrial strength reporting framework using the Seattle Method to do so. Included with each reporting framework is a reference report which tests the entire reporting framework and a number of reports which helps one understand the notion of repor...
Read more

Overview

Image
( Executive summary ) Innovation doesn’t arrive. Innovation evolves. Imagine it.  Freedom from drudgery. Freedom from the toil of tedious, repetitive, mundane, monotonous tasks. Far less time needs to be spent fulfilling the role of "data janitor".  Time spent "transaction chasing" is significantly reduced. Accounting is a well understood system which has evolved over many thousands of years. Accounting, reporting, auditing, and analysis is being digitized. This digitization will enable processes to be industrialized  and productivity boosts to be realized. If you are an accountant, auditor, or analyst it is time to update your tradecraft. This overview is an attempt to take the work that I have done to understand XBRL-based reports and back into a framework for explaining those reports, accounting and audit working papers, analysis models to accountants and software engineers building software for accountants.  I am now referring to this as model-driven reporting ...
Read more

Core Pattern

Image
The core idea of XBRL is global open industry standard for information exchange  that is machine-interpretable that is also interpretable by humans (i.e. one version of information, usable by both humans and machines). This is achieved using the notion of the " information block ". The meaning conveyed by that information block is expressed using the XBRL global open industry standard format. An information block is a structural insight of an XBRL-based report. An information block is an exploitable regularity. An information block is a logical pattern. Having one version of information that is readable by both a machine and a human means that a common shared cognitive understanding and mutual knowledge provided by the information block is usable by both machine and human. An information block is a holon . An information block is an organism . A digital information organism .  An information block is a semantic unit which is stable and structurally sound. An information block...
Read more