As the speaker stepped up to the podium, his opening statement caught the audience’s attention:
“Data is a resource you will not find on your Balance Sheet.”
It was 1985 - I can still see that room and the speaker with his overhead projector (remember them).
I mentally shook my head. I was working as part of a team on a major software development – of course the cost of this development would be reflected on the balance sheet! But then Eureka – the penny dropped and I understood. The speaker was referring to all the data which an organisation has – whether it is in the accounts, is in the sales team’s contact systems or even the market knowledge in the managing director’s head. The seminar concluded - if information is managed and used correctly, it would lead to a more efficient organisation. If information was lacking or poor then the company would suffer, sometimes fatally.
Over the years I have been privileged to share this insight and help businesses on a practical level.
Let’s look at the reasons a business needs information.
- Decision making
Every business is obliged by law to keep records for taxation, health and safety and other legislative requirements.
Operationally we cannot run without data. How can you invoice your customer if you don’t know the quantity purchased and the sales price?
But it is the third category that is the biggest challenge. Ensuring you are making informed decisions. It may be the new business whose market research consists of “my Auntie Mary loves the product” or the manufacturer who tries to export his product to the USA but hasn’t checked the import requirements. We all know of poor decisions based on lack of information. So what can you do?
Take some time to look at data within your organisation. Where is the information coming from, which departments use it, who has responsibility for the quality of data? Are there black holes? Is there duplication of data? I worked with one company who held prices in 3 separate places. The salesman had a list for quotations, the book-keeper had another for invoicing and there was a third set used by the service department for trade sales. Confusion on a massive scale resulted. Because any time there is duplication of data there is a potential for error.
What are the questions for which you would like answers? Is product A more profitable than product B? Did that last job make us money? Did the discount we offered result in increased profit? What is the break-even if we open an office in Germany? And so on…….
Having decided which questions are key you can then look at how best to answer them. Sometimes all it takes is a tweak in existing systems. But sometimes you have to ask for help.
We are lucky in Scotland to have access to superb business support agencies. Scottish Enterprise, Business Gateway and Interface all have a wealth of information and can help you access a wide range of subjects and/or put you in touch with experts.
So be prepared, be informed and make effective decisions.
If you think that we can help solve your business challenge by finding an academic partner, please get in touch.