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Thread: Power of Data

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    Power of Data

    Seeing that this is my first thread, I decided to give my comments on something that I know about. I currently have 10 year experience in data analysis and am amazed by the fact that companies doesn’t really know what is going on in their operations. Usually auditors come in once a year, draw a sample of 5 to 10 percent and base conclusions on this. With different type of data analysis however, 100 % of all operations linked to a computerized system can be analysed.

    According to Wikipedia Data analysis is the act of transforming data with the aim of extracting useful information and facilitating conclusions. A lot of companies have loads of data, but does not use it in decisions. The reason for this is the size or amount of data. Not knowing what is happening on financial or non-financial systems can have catastrophic results. For example, in my line of work, one of the biggest problems is claiming VAT. Some companies process thousands of invoices per month and errors do happen. This results in VAT that is not claimed back from SARS and a lost of revenue, which will lower you profit margins and so on. On non financial systems it is usually not visible as a rand value. I was recently involved in the review of a big retail company’s clock card data. In a single region about 10 000 working hours were lost, due to people absent from work. The employees received salary, while they just stayed away from work, with no reason and without taking leave.

    A simple review to perform is on telephone account. In our company the telephone account dropped by 30 percent. This was done by identifying private calls and questioning employees about it. It didn’t only mean a lost is money, but also a lost in productive hours. This will have a major effect on companies which uses telephones to generate revenue.
    It is my opinion that no small, medium or large entity can function to its full capacity with out Business intelligence. Companies need to use technologies to analyze data and information about company operations. This will help them to have more comprehensive knowledge of the factors affecting their business, and help them to make better business decisions.

    What is your opinion?

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    Site Caretaker Dave A's Avatar
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    There is no doubt you're right. But I see two significant challenges in the average small business setup.

    One is efficiently capturing all this data. Second is having the systems in place to analyse it and interpret results.

    Hmm. I suppose there is a third - acting on the information.
    The trouble with opportunity is it normally comes dressed up as work.

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    Most small business uses package like Pastel. Pastel is able to export certain GL reports to text files. These file are usually text delimited files. The cost of getting information out of these files are lower than what one might think. It is possible to create standard report, based on supplied information and also interpret these reports. You do is design these report and supply the results on a weekly, monthly, yearly or for a specified period.

    Usually there is no startup fee. Usually I design report, without any cost the clients. If the employee is happy with the example reports, we continue with the project. Fees structure are then determined by the client. It can be charged per month or per report.

    Acting on the information, will however still remain a problem. But I think with a small business, you will do anything in you power to increase your profits. If the information will assist you in doing this, you will act on it.

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    Site Caretaker Dave A's Avatar
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    Personally I'm a Quickbooks user, which produces some pretty interesting reports by itself. But when I get frustrated, I'll export a basic data report into Excel and then manipulate it from there.

    Pastel's rather dry reporting capabilities was one of the things that had me looking elsewhere in the first place. That was a long time ago, and they've probably improved - but on one of the organisations where I get periodic working figures and they use Pastel, they're still extracting data into Excel to produce those period reports.

    You raised the telephonecall tracking too, which was interesting. We've got the Man 3000 system for the office, but everyone's cellphone is rather a pain to collect and analyse data. To some extent you can play some tricks on Vodacom4me - but so far I haven't found an effective system that doesn't give you that feeling of data overload.
    The trouble with opportunity is it normally comes dressed up as work.

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    The problem that I personally have is that you are able to manipulate the information. When you are a one man show, it is fine. But when you have someone else looking at your financial information and excel is used for analyzing, the problems can start.

    I prefer using programs like ACL or CaseWare-IDEA to do these type of reporting. It is also easy to create standard scripts or programs that can be run on a regular basis. Personally I prefer ACL. Basically grew up with the software.

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