Johannesburg, 19 Feb 2010
There are a few companies in South Africa considered the elite of the business world. The top 100 JSE listed companies are the benchmark by which the rest of the business community measure their success. Many researchers have conducted studies with regards to the difference between those who make it to being listed as a top 100 company and those who don't. What do they do differently?
In addition, many studies have been embarked on to determine the characteristics of world-class companies. But what exactly is a world-class company? Bosman (1998) defines a world-class company as being equivalent in every respect to the best in the world. This entails a holistic approach to productivity and quality improvement and a focus on the elimination of all forms of waste and non-value adding activities in the organisation. Bosman states that success is achieved through creating a habit of continual improvement based on the involvement of the total workforce.
Some other criteria established as common denominators among those successful companies in business are the alignment of management objectives, managing for quality, good operational practices, staff empowerment and a strong customer focus.
Other characteristics include having visible measurement systems, knowledge sharing throughout the organisation coupled with purposeful communication, and valid, accurate and accessible data, leading to good decision-making.
The success of an organisation fully depends on the efficiency of the decision-making processes. The ability to analyse the historical data, the macro and micro environment, predict the future and make decisions accordingly, will set a company apart.
Scholars have developed different techniques and methodologies to assist in sound decision-making, but with all those tools and techniques, such as the decision tree, accurate data is still necessary before a decision can be reached. Top CEOs are expected to make various good decisions on a daily basis. The effectiveness of the decision-making process will have a direct impact on the success or failure of the company.
Wouter van den Heever, Group Internal Control Manager of Sappi, says accurate data on which to base decision-making, although crucial, is only the starting point. The correct tools with which to analyse the data is necessary to reach the correct decisions at all times. “There are so many tools in the market today, we are spoilt for choice. The tool should provide accurate reporting in real-time and in a format that is user friendly,” says Van den Heever.
Sappi chose to engage with Intellient, a member of the EOH Group since 2000, to provide the Hyperion Financial Management system. The system is used, among others, to provide accurate financial reporting. “The archiving system is good, data is accurate and accessible and reports are provided regularly and customised according to the needs of each division. Sappi implemented the system globally and have found it stable and able to be fully integrated with other systems in the organisation. Intellient provides good back-up support with seamless access to the Oracle know-how and training,” concludes Van den Heever.
Jeanine Janse van Rensburg, who joined Sappi in the Group Finance division in March 2008, says the first criterion for effective reporting is to prevent data from being manipulated. “When data is consolidated on Excel, each person working with the data can easily manipulate the data to suit the current situation. This could lead to situations where data has to be checked continuously to determine accuracy. After all, decisions involving billions of rands are made according to the reports provided.” Furthermore, by 2011 it will be required by USA legislation to submit annual reports to the USA Securities Exchange Commission in eXtensible Business Reporting Language (XBRL). Sappi is striving, with the help of the Hyperion system, to be prepared for this requirement by late 2010. Janse van Rensburg is confident that this goal will be achieved as a result of the help received from the Intellient helpdesk.
Oracle Hyperion Financial Reporting offers the XBRL Manager, using XBRL to convert data into a standard format that can be read and processed automatically. It is common knowledge that the variables in financial data and reporting are vast. Simultaneously, the most onerous responsibility for compliance is in the financial field. The Hyperion XBRL Manager assists financial managers and investors through providing a standards-based method to prepare and exchange financial statements.
“Business processes were improved through the implementation of the system, which was done in line with the Sappi business requirements. “Through the use of XBRL interactive data, investors will be provided accurate financial information from public companies, such as Sappi,” concludes Janse van Rensburg.
The message is clear for aspiring companies striving to move into the world-class arena and become part of the top 100 elite in South Africa; good decision-making, based on correct data and sound analysis thereof, coupled with continuous learning and management for quality, based on good communication and knowledge sharing throughout the company, will go a long way towards a company reaching its goals.
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