Data for Management Decisions - by Ravi Patel

 

Companies install sophisticated financial systems to manage the growth in number of transactions processed. How relevant are such systems for management decision-making? Have you analyzed that?

 

In addition to managing operations, are financial systems in your company primarily for accounting purposes - reporting and compliance? Or, do they produce meaningful data for management decisions?

 

Historical data for reporting captures results at a point in time, and even then such data is not always timely for current decisions. What is necessary is data for meaningful analysis (customer, market, revenues, costs, expenses, margins and so on) that facilitates appropriate decisions and action by management.

 

If financial systems do not produce useful data in managing your business, you need to review such systems and make changes such that meaningful information is produced on a timely basis to allow more appropriate management decisions.

 

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