Profit Management in High Transaction Volume Companies

As companies increase in size, extraordinary growing pains occur. Locations multiply into thousands. Transactions escalate into millions. These companies experience the particular problems associated with high transaction volume business environments. Specifically, reporting and analysis becomes extremely cumbersome. Managers who need to crunch the numbers cannot easily use spreadsheet packages like Microsoft Excel or Lotus 123. All of these tools are limited to less than 100,000 records. If a company wants to complete an even more complex business initiative, like profitability analysis, they certainly need better methods. In this paper, Mr. Anderson discusses a methodology that enables companies to accomplish sophisticated reporting and analytics for profit analysis on a high volume, enterprise level.

What do financial institutions, insurance companies, retailers, telephone companies, airlines, universities, and distributors have in common? They are all engaged in a high transaction volume environment. With hundreds of thousands, if not millions of orders each period, encompassing a myriad of customers and products, they thrive on uniformity. Without it they could never achieve the speed of processing required of them. Customers of Capital One would switch credit cards if monthly statements were incorrect. Travel agents would direct their customers to different airlines that offer the same price. These institutions and their industries have mastered their processes (e.g., customer service). They are the McDonalds in their respective fields. Every time you walk into a PNC Bank or place an order with Sysco Food Service, regardless of location, you will be offered the same products and services. Your transactions will be processed through the same systems. Your bills / receipts will have the same look. And the phone call you get when your account is delinquent will be the same. Standard Operating Procedures are good business. They lower overall cost, improve quality, and most importantly, enable scalability.

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