set your crude accountants free!
Data collection. How much time does your staff spend on it? Many companies still maintain manual data point collection for accruals, or cost projections. Manual data collection is fine, as far as it goes, but automated data collection systems are a boon to the crude accoutants who use them.
Automated data collection systems save hours of time, improve accuracy by eliminating fat finger mistakes, and raise morale by increasing reporting speed and shortening close timelines. The problem is, those automated systems often boast a hefty price tag. So how are you supposed to get budget approval for an automated data collection system, particularly in such a budget-conscious environment as the oil and gas industry?
1. Calculate the cost of manual data collection.
Manual data collection takes time. You have to hire clerks or temps to collect the data, which can present a significant cost to the company. And even if you’re keeping the collection in-house, hours add up, particularly for the monthly nature of inventory valuation and cost calculations.
2. Calculate the true cost of errors.
In addition to the cost of hiring temps or paying clerks to collect data, errors themselves cost money. Staff spend hours checking and rechecking data that may be incorrect even coming through the door, making phone calls to discuss the matter, and waiting for a bogged down department to deliver on a very slow to process report, all of which will lead to a poor estimate of that the accrual should actually be. And don’t overlook the cost of unhappy buyers and sellers!
In some cases, just one month’s worth of data collection errors (and the cost of correcting them) is enough to cover the cost of an automated data collection system. An automated system will lighten the load on multiple departments, drastically increase reporting speed and accuracy, and, most importantly, will enable the company to better understand how cost and inventory are moving, and make better strategic decisions for the future!