Measures For Sucess: Liquidity Position Of A Company

Measures of Success
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The liquidity position of a company plays a very substantial role in the decision-making process in regard to issues that concern the future of the company. Therefore, general services managers and financial managers have the obligation of working together to ensure that the days of accounts receivables have been reduced. In order to achieve this, financial managers and department administrators can carry out different activities such as data centralization and communication, the use of business applications like Enterprise Resources Planning (ERP) and the development of Key Performance Indicators to ensure that the account receivable’s days have been reduced. Also, the management by objectives approach is used when evaluating the success of an employee’s regarding a certain project in order to pay them a bonus as an appreciation for their profitability.
Data centralization and communication is a great way of reducing the days of accounts receivables because it aids in work organization within the company. Having all the account records in one place makes it easy for the employees to consolidate the transactions effectively and in turn, close the day’s activities without any limitations. Therefore, this helps in the early identification of clients, the organization of planned sales and, in turn, effective collection of accounts receivables. Hence, enhancing the communication system within the organizations reduces the days of account receivables by eliminating any transactions delay that could result due to poor planning within the organization. Data centralization and communication provides room for sales representatives to use information from the customer relationship management in order to identify sales opportunities. Th...