Albert Einstein once said that “information is not knowledge.” Rather, information has to be processed, organized and made readily available to be useful. For companies of all sizes, accurate information is the key to effective decision making -- from supply chain management to disaster recovery planning. Companies that have grown from start-ups to Fortune 500 have developed numerous complex computer and application systems to capture both financial and operational data. A small, high-growth business can suddenly find itself maintaining a sprawling network of systems and data sources, the accuracy of which become more suspect and complicated to consolidate with information from multiple sources. So, how can a company consolidate information from various departments or operational units and alleviate the strain of inefficient processes and potentially inaccurate reports?

The key is a “book of truth,” a one-stop shop for all things business-related. In recent years, capturing financial and operating data has evolved from pen and paper to information technology based systems comprised of hundreds -- sometime thousands -- of computers and applications. Using single source data applications such as enterprise resource planning (ERP) systems, companies can compile a “book of truth” complete with core business functions such as manufacturing, financials and customer relationship management. Such a compilation allows for every department of a business to store and retrieve information in real-time, thus accounting for simplified automation, fact-based analysis, streamlined risk management and overall improved business processes.

How should your organization develop a book of truth? Start by ensuring the following systems and processes are in place to ensure a healthy start:

Automation without complication

Automation tools for implementing controls are increasingly built into many applications to store data related to business functions, thereby shifting the employees’ role from hands-on facilitator to overseer. In the overseer role, employees verify that the automated tools are performing as promised, and under the scrutiny of auditors, this ensures that the systems conform to regulatory requirements unique to specific industries. Testing these tools for maintenance and upgrades on a routine basis also provides verification that the systems are reliable, assuring the regulators, investors, and creditors that the applications are a source of truth for these entities.

Fact-based analysis

Business analysis improves an organization’s ability to not only reduce overall costs, but also more efficiently use resources and better serve customers. With fact-based analysis and scenario modeling in hand, companies can quickly and knowledgably react to challenges from the business-side.

Businesses often succeed or fail on the quality of decision making, which is derived from the quality of information. While accurate, timely information can dramatically improve the efficiency of a business, a flawed measurement and analysis can cripple it.

Streamlined risk management

Amidst a virtual world where companies store and share data electronically, many organizations are increasingly using governance, risk management and compliance (GRC) tools to automate implementation and risk and control processes. Although this integrated approach is often referred to as a single business activity, it actually involves multiple overlapping and related activities within an organization, including internal audit, compliance programs like SOX, enterprise risk management, operational risk, and incident management. A unified GRC strategy guides people, standardizes processes and integrates technology to embed GRC at every level within the company.

Improved business processes  

Regardless of industry, developing strong governance standards for automating, monitoring, enforcing, and improving business processes is an effective methodology for reducing risk (real and perceived), achieving compliance and increasing cost-effectiveness. Effective corporate governance is inextricably related to the employment of structured processes and risk management procedures to ensure an organization's operational effectiveness. When properly planned and executed, a process redesign can result in predictable, high-velocity information and material flows.

Businesses with a “book of truth” can make end-to-end activitiesmore efficient and remove unnecessary, non-value added work. In addition, continued innovations in business intelligence processes and systems are creating stable, predictable and logical processes and controls that help companies of all sizes deliver increased revenue, cut costs and satisfy customers.

Mike Gorsage is a Partner and Technology Practice Leader for Tatum LLC. Tatum is the nation’s largest executive services firm, providing financial and technology leadership nationwide.