Information Is King

November 8, 2006

Whether you are starting a business or managing a business the old adage that “cash is king” needs to now also include “information is king.”   You cannot make good decisions without accurate and timely information.  Running on your “gut” simply does not cut it in today’s competitive climate.

Let’s talk about information “needs” for any business:

1.  Financial.  Of course, the obvious is how is your Company performing from a financial point of view.  Not simply the bottom line, but line by line and item by item.  Where are you in all areas versus your plan and versus industry standards.  Are your margins consistent with competitors?  Are they worse?  Why?  Are your major overhead areas under “control?”  Or, is spending out of control?   Who is analyzing the numbers?  Do you have top notch accounting help?  Are you seeking their advice before you commit to spending in new areas?

2.  Competitive Intelligence:  Do you really know your competition from a detailed information perspective?  Beyond their public financial information and known market share(s), have you examined their personnel?  What about their products from a performance point of view?  How efficient are their manufacturing operations?  Are they lower cost producers then your Company?  What about their resources both financial and relationship?  How do customers view them versus your Company?  Are you at a competitive disadvantage in this area?  What are their intentions in the areas in which you compete?  What appears to be their strategies?

3.  Market Trends:  How do you know  whether the market(s) in which you compete are growing or shrinking?  What do the trends tell you?  How do customers view the market and how will that view likely change?  How are your products viewed by customers within the market versus competition?  These questions and dozens more need to be explored through research.

Obviously, the above is just the “tip of the iceberg” but I am sure you get the point.  Decisions made based upon reliable and accurate information often lead to good outcomes.  Decisions made based upon intuition and/or gut feel often lead to poor results.

Rich

Bizvice:  Strategy, Marketing & Entrepreneurship

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