Management by numbers

Citation

Shaffer, R.I. (2001), "Management by numbers", The Bottom Line, Vol. 14 No. 3. https://doi.org/10.1108/bl.2001.17014caf.002

Management by numbers

Management by numbers

Introduction

There is probably not a management position in today's information intensive environment that does not require a manager to be able to spout out certain numerically based facts off the top of his or her head. Often, we must have these facts at our fingertips to make an informed decision quickly, to respond to questions, to make an important point in a spontaneous conversation, or to simply manage or advocate effectively.

There are some numerical facts that all information professionals should know generally about information and its use in our society. People always expect information professionals to have reliable and ready numbers on Internet connection and use. Other facts are, of course, unique to subject specialties or to one's particular workplace or business type.

Once a manager has been in a position for a while, numerical facts and comparisons thereof that the organisation values will become apparent. But, it is never a poor use of a manager's time to set up a system for tracking numerical facts, and exerting the effort to fill in the various topical areas that will serve as the manager's fact arsenal.

Just as one may be keeping a current catalog of numeric information, which will include annotations about the source of the information, it is also a good idea to make notes about the information that has been requested and by whom. As you see patterns in what kinds of numbers are of interest to "higher ups", you may be able to extrapolate certain conclusions about strategic direction and productivity expectations.

Collecting facts

The following is a listing of numerical facts that are generally useful:

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  the dollar cost per capita of primary patrons to operate the information centre in the organisation;

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  the average cost of a book, journal and database search;

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  the amount of square footage that the information centre occupies (and a subset of space provided for collections, equipment, staff offices, and common areas);

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  number of primary and secondary patrons served;

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  ratio of your organisation's overall staff to that of the information centre's staff;

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  the exact annual budget;

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  specific spending allocations for collections, salary (and benefits) and equipment;

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  disbursements paid on a monthly basis;

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  revenues generated on a monthly or some other regular basis;

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  tracking of any peak or valley points in the year (services, cash-flow or revenue generated, for example);

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  average transaction costs for specific types of service (inter-library loan or document storage as examples);

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  updated or current costs of items on a wish list (particularly those that are equipment or technology related);

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  comparable statistics for any organisation against which your organisation is bench-marked.

Record keeping

Once you have determined the categories that are of interest to you and your organisation, then you need to set up a realistic and simple system for tracking. For most of us, an off-the-shelf spreadsheet will suffice. It must be easy to access from a computer and then easy to input the information. You should aim for a system that will not require more than "three clicks" to perform any function. Collecting information should not be so time-consuming that it eats away at any value that it might provide.

It is also important to make an early determination about the periods that will be aggregated, and also retention periods. In making the data retention decision, be sure that retention periods are long enough for you to observe trends. In most cases, a trend requires more than three months to identify, and most trends within information centres are identifiable by comparisons between two years. That said, changes in the way business is conducted today may require us to make decisions more quickly. This is all the more reason for collecting our facts, and relying on them rather than just intuition to make decisions.

Using numbers to make decisions add up

As mentioned in the introduction to this column, numerical facts are good friends to have on hand when the unexpected question or instantaneous decision appears from out of the’blue. Yet, the real value of collecting numerical facts may be in their impact, taken as a whole, in helping us to plan, to change direction, to allocate funds, and to be accountable.

Numerical facts should be included as a regular section of an annual report. They may substantiate what is said in the text section or they may reiterate the narrative. Do not be afraid of presenting your case in both a text and a numeric fashion. With so many different learning styles, this kind of redundancy is rarely viewed as superfluous. In addition, presenting facts numerically gives you a great deal of flexibility to use charts and graphs, raw numbers and percentages, and to show comparisons that would be very cumbersome if they had to be made exclusively by words.

When making the case for "buy in" to a management decision, it helps the advocacy process if the numbers behind the decision can be shared both with the decision makers or approvers, and those who will be affected by the decision. For example, if you are deciding to spin off a unit from an existing unit, it may be useful to show the reason in numerical terms. The case will be stronger for your anticipated increase in service or sales if you can show past levels of service or sales.

Conclusion

Numerical facts not only represent value(s), they also have value in the management process. Often, it may seem that they are difficult to track and not worth the effort of calculating. But, in a time when business relies so heavily on "the numbers", managers in the information professions should realise the value of numbers in their decision making. It also must be recognised that many numbers which are based on transactions would be impossible, very difficult or very costly to reproduce once the moment of their occurrence has passed. Do not miss out on any opportunity to use tools as potentially effective as numerical facts.

Roberta I. ShafferDean, Graduate School of Library & Information Science, The University of Texas at Austin, Austin, TX