Management With IT Systems

Management with IT systemsIT systems are an integral part of business, in fact the whole global community is effectively a single global network connect through the Internet.

Many of our data/information sources are generated on our internal IT systems, or perhaps in the cloud today.

So where are the common sources of data/information sourced from in most businesses. The core and most common source is the accounting system. The problem is that most business owners never look beyond the top line of the Income Statement to check the monthly sales revenue.

Very few accounting systems have good reporting systems, and those that do are seldom set up correctly, so the reports are generally standard reports with little if any analysis being done. This should be the first stop. Spend money and get an expert in respect of the accounting software to come and set up your reports for Income Statements, Balance Sheets, Cashflow Statements, Debtors Age Analysis, Creditors Age Analysis, Sales Analysis, Stock Movement and Stock on Hand reports. These are the minimum you should have they should be setup as discussed above. Go through every report available and see how they contribute to your management perspective of the business.

Do you use a computerised quoting system? Very few businesses do! Most simply rely on the secretary typing quotations on a word processor, print them, and seldom file a copy any longer. Is anyone tracking how many quotations were issued in the past month? Which salesperson requested the quotations, for which clients and which products/services? Is this information summarised and reported on? No quotations generally lead to no sales. Obviously if the business is a retail cash business, then this is irrelevant. Remember there are implications in respect of quotations in the context of stock control. What is the business stock on hand policy? What is the relationship between sales, stock on hand and ordering lead times. Who is tracking this and planning for it? If there is no system in place there should, even if it is a spreadsheet. Out of stock can lead to loss of sales or reduced profit margins when new stock increases in price and the client has confirmed the purchase price. Who is tracking sales against advertising, marketing and sales? Is there a system tracking this and if not when will there be one? Are the conversion rates per salesperson being tracked? Who is the best salesperson overall, and who is the best by product? What is the marketing/advertising costs per item sold and per salesperson? What is the revenue and separately the profit IRR on each salesperson’s salary? What is acceptable? It is imperative to measure all relevant metrics. Consider our list of metrics.