Click
Here
for more articles.
|
|
|
mmaterial Values
in Business Management |
by:
Stephan
Szugat |
Article Title:
I
Author: Stephan Szugat
Word Count: 915
mmaterial Values in Business Management
Maybe you have already heard that in some ways immaterial values
are important for business management. But you might not found
how to bring them into your management processes or into your
reporting packages. However, first of all we should be clear,
what immaterial values are? Well, this includes the balance sheet
information about intangible assets, but is going far behind it.
As we all know, decisions are mostly based on feelings or emotions,
than on logical judgement. A feeling is an energy. Energy is not
material, it is immaterial. The overall emotions or motivation
of employees in a business is a immaterial value, it could have
positive and negative impact on the business development. Does
sound very esoterical for you? Might be, but today we know that
our emotions drive a lot of our life.
Not only the feelings of the emplyoees have an impact on the business
development, also the feelings of potenial customers have it.
These customer feelings could be measured as customer satisfaction,
as how customers see the company or it’s products and services
and so on. There is more energy, which is immaterial, included
in our business life as we are aware of.
Until today we might know about these energies or have read that
businesses have to be more aware of them. But to find Solutions
which are able to measure these energies are not very common and
hard to find. Business Management still uses hard figures such
as ratios based on financial values and just forgets that there
has been more than only the numbers from the accounting and the
money in the pocket.
If you only look to the accounting figures of a business, you
only look to this company as if you were looking at an iceberg.
You only see a fraction of the iceberg, only what is above the
surface. Everything below the surface is out of your view. While
the iceberg is melting away, it still brings up new parts of it
self. But you only see this new parts, when the iceberg is melting.
It’s just the same with the accounting figures as soon as you
see them they are gone. That means they are old, it’s nice to
knew them, but they relate to business already accomplished.
The accounting figures are just like to iceberg when it comes
above the surface while it is melting away. Now, wouldn’t it be
great to see the whole iceberg, even if a big part is below the
surface? Yes, it would be great. The immaterial values of your
business are just below surface. If you bring them up, you could
see the whole picture of your business.
Running a business only focusing on profit could lead to running
into a collapse. It might take time, but soon customers and employees
will find out that just the profit counts to a specific company.
Well, it’s correct, no business could survive without profit,
but first of all every business has to make profit on immaterial
items, such as image, motivation of employees and customers faith.
One day from these immaterial profits the financial profit arises.
That’s the theory. Propably you already read about this, but have
you found a way to measure immaterial values of your business?
It’s not that difficult, but it needs some thoughts. First of
all it is important to make a list of immaterial values which
have the most impact on the business development. When this has
been finished, methods to measure and valuate the immaterial values
have to be found.
And at last, the values for all the selected immaterial items
have to be analysed regularly. Setting up such a Reporting System
for immaterial values could be a long lasting task. You might
try to do it with a spreadsheet program or with a database, but
either way will take it’s time. Using ready made Standard Software
might be another option, but there are not much choices. In case
you use the Balance Scorecard, you might think having all the
data mentioned above and you might think having a good solution
for analysation.
The Balance Scorecard has it’s advantages, but for a short, fast
and regular analysis of immaterial values it is far to complex
and much to slow. There is just the need to measure, store and
analyse some data. About 30 items will be enough to have an overview
of immaterial values and some material values as well. Most of
the necessary data are usually already stored in every business.
They only need to be concentrated into one table and have to be
analysed.
Are immaterial values important for every business? Yes. This
includes big businesses as well as the one-man-business, retail
stores, mechanics, freelancer and so on. You may find more information
on immaterial values in business management, when searching for
Early-Warning-System, Early-Recognition-Sytems and something similar.
You are able to find one or the other immaterial value included
in Management Methods, Ratio Systems and Financial Analysis. But
still, most Reports and Measurement System are based on financial
data.
A Solution which every business, no matter of size, could use,
is the abenetis ERS (Early-Recognition-System). It is called Early-Recognition-System,
because with the used immaterial values every business could be
aware of tendencies in it’s business development soon. At the
moment the abenetis ERS is available only as Online-Service, but
could soon be delivered as Intranet-Version, too. More details
are available at our ERS-Subscription Page.
About the author:
Stephan Szugat is founder of abenetis a web-based service about
Business Management Solutions focusing on the core needs of business
management. This includes operational and strategic analysis especially
Early-Recognition-Systems, Knowledge-Management and other Services
for small and mid-sized businesses. He has approx. 15 years experience
in the Finance and Accounting Area from companies of different
size and from various industries. http://www.abenetis.com
Circulated by Article
Emporium
|
|
|
