Deliverable 1 - Managerial Decision Making

Quality data can be one of a company’s most valuable assets. We do not usually see this listed on a company’s balance sheet because it is not something they have purchased. So how do we determine this “value?” First, let’s define some terms. Quality data is usually defined based on a number of qualitative and quantitative characteristics. Some of these characteristics are accuracy, completeness, validity, and timeliness. Additionally, the data needs to have integrity in order to be useful.

While we may see the terms quality data and data integrity used interchangeably, they really are not the same thing. Data that has integrity is usually a subset of quality data. In other words, in order for quality data to exist it must have integrity.

Validity

Validity is one of the most crucial characteristics of quality data and data integrity. In terms of integrity, validity means that we can establish a direct link between the data and the source of the data for validation purposes. Without this link, the usefulness of the data is called into question.

Reliable Sources

Having credible and reliable data will lead to better, informed decision making. Making a business decision requires the most reliable data available. So, where can we find this data and how do we evaluate its reliability?

With more and more information available through a variety of resource, like the Internet, it may be difficult to determine which data is reliable and which is not. We need to find data and information that we can trust. Additionally, we need data that is more than just believable, but is convincing as well as accurate and reputable.

Generally, data that is generated by a company through their normal business transactions has immediate credibility. The problems come in when we need data from public sources to perhaps combine with our internally-generated data. Adding reliable data to unreliable data does not make the unreliable data any more credible. Adding quality public data to our trusted internal data will result in better results and better decision making.

The process we go through to find reliable public data is not that much different than when you are writing an essay or term paper for your college course. You go to the library and search for works written by experts and have been vetted for accuracy and peer reviewed.

Businesses will follow the same concept when accessing public data.

Example of Reliable Public Accounting Data

As an example, a company may think it has an issue with their inventory management and may want to compare its inventory financial data to that of other companies in the same industry. One source that the company may choose to find information about other companies is Mergent Online. If we go through the questions of reliability in the widget on this page, we will find that we can answer “yes” to each one. Mergent Online provides Internet-based access to the most detailed, accurate, and comprehensive global company database available. According to their website, every data point is processed through a rigorous multi-stage validation process.