I hope you are all enjoying the information am providing you about the ‘value of information’. In this blog I will examine if companies are reaching the maximum information levels they should receive with the money they are giving out for this information. This is known as the ‘worth of cost’ or ‘cost effectiveness’. Are firms getting goods and services they deserve for the money they spend.
It is important that you are cost effective when running a business because you can only use the information that is available to you. The challenge is to acquire superior materials, staff and facilities without spending so much that profit margins are affected and keep the costs to a minimum. Some companies try to be cost effective by reducing the number of staff but this downsizing can result in extra pressure on staff and as a result, less profits. If you predict from the information that you have that benefits will exceed costs then the programme should be implemented. This video puts into clear focus how you can increase time and cost effectiveness
Sometimes businesses have to take risks in order to become more cost effective.They must examine the information available to them and then make risks based on this information.EG If theft was not a problem in the company in the past they may reduce the level of security on the grounds.