Working Capital is a Misnomer. Or?

Working Capital is “A measure of [both] a company’s efficiency …” (http://www.investopedia.com/terms/w/workingcapital.asp). Hmm. Isnt’ working capital about tied up cash? About having customers paying their bills faster? About lowering the inventory? About paying suppliers not too early? Hence isn’t working capital a pure financial figure? That’s indeed the general opinion we are confronted with in our conversations. Though this conclusion is far wrong! As we all know working capital is determined by the operations of a company (hence the prefix “working”). Indeed working capital is a much better indicator to measure the operational performance of a company than revenue or profit. So why isn’t working capital more frequently used in the daily management practice? Because it requires to be able to relate operational and financial KPIs in a meaningful manner. This is impossible! Or? No. We can. Don’t hesitate to talk to us if you are interested in our proposal to measure for example your “shipping on-time” in euros. We’d be glad to help you.     Guenther Tolkmit / Chief Delivery Officer and Co-Founder at Trufa,...

12 Rules of True Finance Applications

Once again we are living through a time of uncertainty and doubt. Is Big Data just old wine in new skins? Or is it a genuine change of quality with true benefits? And if yes how can we separate the wheat from the chaff? How can we tell whether a vendor has just big-data-washed his offering or whether he is really providing new technology solutions? In order to rationalize this ongoing debate we are offering 12 rules which we believe capture the essence of the change in front of us. We call them “12 rules of true finance applications” because they evolved in the context of our undertakings for the last 40 years. We believe they are concrete enough that business as well as technology people can relate to them. That said we’d like to encourage you to use them as a yardstick whenever you are asked to assess a Big Data solution. Have fun. Here you go: The 12 Rules of True Finance Applications Rule Explanation True Numbers All numbers are calculated rather than approximated All Details No relevant information gets lost due to aggregation or cleansing for example No Semantic Gap The same language throughout the whole world of data Transcending Silos All business functions look at the same source of truth Forward-looking Simulating the future leveraging true relationships insights Intuitive Usage Deciders understand their discipline without intermediaries (e.g. data scientists) Instant Live No data preparation (especially modeling) beyond access to raw data Viral Implementation All potential users can study the data without further ado Collective Intelligence Cloud-centricism enables collaborative decision making Ready-to-run Apps No IT (ERP/BI) projects in...