Is your data costing you money?

The range of software solutions on offer to Singaporean companies to assist them in planning their operations continues to grow as vendors increasingly develop industry-tailored solutions, to match the increasing degree of specialisation required by each industry segment.

Regardless of the planning software selected, data integrity remains a key requirement for all organisations. Lack of integrity continues to be one of the most common issues for software tools not delivering on promise.

Increasing sophistication of software and greater support for real-time decision-making will just lead to systems providing poor information more quickly and at higher cost, if the data is not reliable. Yet, many businesses continue to operate with data that falls short of the required accuracy level to support effective planning.

To prevent the wrong products or materials being purchased in either the wrong quantities or to the wrong specifications, bills of material (recipes) must be kept up-to-date. Accurate item master records are vital in ensuring incorrect material plans do not result in poor timing or quality.

Work centre or routing data has to be correct for capacity plans to reflect reality and for manufacturing to prioritise properly. Incorrect inventory records will inevitably lead to either too much product/material being ordered and excess inventory, or shortages from not enough product/material being ordered.

Lack of control in this area puts excessive strain on an organisation’s working capital and customer service levels. And if supplier records are inaccurate purchase orders will be sent to the wrong address and goods will not be delivered.

In our experience, at Oliver Wight, if a company’s data integrity level is lower than 95% (98% for Bills of Materials) employees will stop trusting the information. Typically in this situation parallel manual systems or processes are run to get the ‘right’ information, commonly resulting in a lot of short term issues and a ‘firefighting’ approach to working, creating additional workload and cost.

So what causes this lack of data integrity? Two main causes are lack of ownership and absence of measurement.

Ownership: All too often organisations assume that the IT department, responsible for the software installation, will be responsible for the integrity of the data used by that tool. But this is like assuming an engineer who builds and installs a wood cutting machine is responsible for the quality of wood processed through it.

The old adage of ‘garbage in – garbage out’ stands true. Processes must be developed, documented, understood; and users of the tools need to be accountable for ensuring data used is up-to-date. It should be incorporated in to individual roles and job descriptions.

Measurement: What gets measured gets done. If data accuracy is not measured, typically it will be poor. If this is critically important foundation data, all the processes which depend on it will be affected.

Data integrity measurement is like a health check for your software tool. If you don’t check it regularly it can easily get sick! If you are going to get full value from your software investment, and ensure it is improving your business rather than costing you money, data integrity is vital.