Uncategorized

Want Tomorrows P&L or Balance Sheet Today?

Posted

No not selling you anything dodgy here, but have a think. Imagine of you could get tomorrows Balance Sheet or Profit and Loss statement today? How about the whole of the next year? Next 2 years? Watch how the incoming and outgoings are likely to play out in advance with a high degree of accuracy? It is not only possible, its actually not that complicated!

Lets take a look at the basics first. You have a number of accounts and expenses that you know are not going to change significantly and a number of clients who you can expect revenue from. Using Augmented Basic Business Intelligence Engine we load the numbers for the last number of years and using predictive algorithms to calculate likely increases in things like CPI, rent or wage expectations we tweak these numbers to bring them into a close approximation of the “if nothing changes” state.

That’s not the end though. Influence tables allow us to further adjust the numbers based on a potential change – either up or down. Expect a drought to squeeze supply? Chose the influence and severity to see the impact. Expect a glut? Same deal. Influence tables can be created based on personal experience or reading augmented data from historical market movement. Looking at acquiring a competitor? Influence tables could adjust the revenue and costs to reflect the integration value.

the most important thing to know though, is that the fundamentals are actually already in your hands. Your business has been running until now and will need to operate in largely the same way for a little while to come. Perhaps before you make significant changes, a little augmented BI could guide to to the best date and time to do so.

 

Leave a Reply

Your email address will not be published. Required fields are marked *