Founder and CEO of the Institute DBP. Je advises corporations on how to generate and convert knowledge into a valuable business asset.
Management guru Peter Drucker is quoted as saying, “You can’t take care of what you can’t measure. For this reason, knowledge and research (D
Before you identify your measuring entity, you will first need to perceive the business knowledge. Business knowledge is the information needed for your top 3 business objectives: operations, compliance, and decision making. To work towards the development of those goals, you need to leverage 3 main types of knowledge: master knowledge, master knowledge, and transactional knowledge. Reference knowledge represents business categories such as factories, coins, and stores. Master knowledge is data about business entities such as products, suppliers, assets, and customers. Transactional knowledge relates to commercial occasions or movements such as orders, invoices and lists of values.
Now back to our original question: what kind of knowledge deserves you to measure?The basic knowledge and the teacher are quite static in nature and few in number. Transactional knowledge, on the other hand, is time-sensitive and voluminous, making it much more suitable for measurement. Consider the following five reasons why transactional knowledge is ripe for measurement:
1. Companies are limited by resources such as capital, time, skills, machines, etc. Transactional knowledge represents the input of those business assets and can provide insight into how those resources are managed.
2. Transactional knowledge, unlike master knowledge and master knowledge, represents a financial price that can also have an effect on your company’s bottom line. There could be 500,000 consumers (master knowledge) in your CRM system, but how many of them have consumers placed orders (transactional knowledge) in the last 12 months?
3. Transactional knowledge has a double effect on accounting: per price received, an equivalent price is given. This means that compliance with accounting criteria such as IFRS and GAPP is based on transactional knowledge.
4. Transactional knowledge serves as a legal record or binding document in the case of invoices, orders, payment notices, shipments and more between counterparties.
5. Transactional knowledge supports function comparisons and decision making. It is best to check to measure when there is quantitative knowledge to process or track. Transactional knowledge is quantitative in nature and can help you compare KPIs such as accuracy, range, accuracy, outliers, and confidence intervals.
There are many types of transactional knowledge and yet they all offer the same business value. So how can you start measuring transactional knowledge to better manage your company’s performance?
First, the transactional knowledge you measure is closely related to one or more of your company’s 3 strategic purposes (increasing profitability, reducing expenses, or reducing risks) can be used to help you formulate a concrete purpose statement.
Second, the functionality of the transactional data you track will have to be under your influence and Array. For example, the value of crude oil is transactional knowledge for an oil company. which means that the company has very little influence or over them. Therefore, seeking to measure oil prices would be of very little use to this company. On the other hand, measuring purchase orders can help this company get larger quantities of items, prices, supplier statistics, and more. .
Third, the transactional knowledge you measure lends itself to optimization. It won’t have to be similar to outdoor activities, the same old activities of your company. Similarly, if knowledge is not taken into account in your company’s operating source of income or EBIT (earnings before interest and taxes), it might not be useful to measure it.
Today, industry regulations are rapidly becoming. If corporations are slow to adapt to the insights they derive from their transactional data, they will eventually fail. Therefore, measuring its functionality in the transactional database is not a one-time event; be an ongoing process.
Measurement is an integral component of modern science. In today’s world of VUCA (volatility, uncertainty, complexity and ambiguity), measuring functionality is critical to optimization. This procedure will help you better identify your company’s capabilities, set benchmarks, and try to adapt to your company’s conversion desires across the board.
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