Breathing Room: Exception-based Reporting

Intelligent Enterprise will streamline the process at the management level to allow more effective day-to-day operations. To my mind, this is the very near future - without the adoption of exception-based reporting in the growing sea of corporate information, corporate managers will fall prey to inefficiency through an overwhelming paper crunch. In traditional data warehousing systems a manager is faced with hundreds of reports that are available to him, and most managers end up using a select and trusted handful of reports to help in daily functions. This leads to a manager ignoring a report when it should be looked at.

Financial departments of large corporations are a strong example of the type of user group best served by exception processing. A manager who is made to look through 80 or more reports will quickly begin to ignore reports that are normally irrelevant to day-to-day operations. Say that one report, analyzing customer payment patterns, shows a weighted average of how many days overdue a customer stands on total invoice remittance. A number of 15 to 30 days may be acceptable, but a pattern of 45-plus days two months in a row may imply the customer is in some financial trouble - and the manager may need to take action to ensure the company is not taking on a significant risk in supplying the customer. Exception-based reporting through an Intelligent Enterprise allows a rule to be established so that the customer entries that have more than 45-plus days for two consecutive months are automatically sent to the manager for a follow-up. With this process the manager's time is freed up under normal circumstances, and when a customer needs his attention, an exception-based report ensures that he is alerted to the situation.

In this way, Intelligent Enterprises have started to complete this data loop: Data -> Information -> Knowledge -> Action ->

This loop is key to a process of continuous improvement that companies have to embark on to stay competitive in today's world.