Bad Data Blamed for Bank Problems

by Erin McCune on February 12, 2009

in B2B

Erin McCune

This article in attributes poor decision making by bankers to bad data rather than greed, excessive risk-taking and lax regulation. I won’t let them off that easily, but I do agree that data quality is a real and significant problem for corporate decision makers in every industry. As budgets tighten amid economic uncertainty the need for timely, accurate information for management reporting has intensified.

It can take weeks (literally!) to process invoices due for payment and apply incoming cash to customer accounts. This obviously makes it difficult to manage liquidity on a day to day basis, but it also leads to inaccurate or misleading reporting. Management making decisions today that do not reflect invoices stacked up in A/P (or worse yet in far-flung regional offices) may find themselves in a very uncomfortable position in the coming weeks.

It is difficult for companies to obtain funding for back office initiatives that streamline efficiency and improve accuracy in order-to-cash and procure-to-pay but those companies that have made the investment have a far more accurate understanding of their financial position. If there is a silver lining to this economic crisis, it may be that back office inefficiencies come to light and the value of real-time transactional data drives much needed improvement.

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