Garbage In, Garbage Out

Management information needs to be timely, relevant, clear and reliable.

Relevant and clear comes from the design of what information is presented in what way. Timely comes from ensuring that the information process is efficient and cost-effective.

But none of this is worth anything unless the information is reliable. [...read more...]

Designing Business Metrics

When designing the metrics which you will use to monitor and control your business, it’s important to ensure they drive appropriate behaviour.

This is especially important with any metric with one figure being divided by another.

For example it is important [...read more...]

Multi-Dimensional Forecasting and Reporting

You sell 60 products across 25 countries. In one country you have 5 salespeople. Fairly modest numbers – there could be thousands of products and many more salespeople.

Now you want to forecast sales, cost of sales and gross profit by month. [...read more...]

Cost, Revenue and Cash Flow Drivers

Many moons ago I was Head of Finance at Celltech, the biotechnology company. Some R&D costs were project or department-specific, but others were allocated by the number of people in each section.

Then the first manufacturing process started. Initially the same cost basis was used, but this began to produce bizarre decisions, such as [...read more...]