We present: dab:Mittelstand GmbH
dab:Mittelstand GmbH, which started operating at the beginning of the year, adds another unit to our company group dedicated to data analytics, following on from dab:Software.
Here I would like to explain what led to this step, and what the new company will focus on:
Our vision at dab: Daten – Analysen & Beratung GmbH is "making analytics fundamental".
In the meantime we have been successfully working to achieve this for almost 12 years. Our client base consists primarily of multinational companies and major corporations. In most cases data analytics are implemented here among other purposes in internal (corporate) auditing to examine the effectiveness of internal control systems, analyze weak spots in processes, and to support classic auditing chores. Of course, the benefits of data analytics actually go far beyond matters of auditing: Prime examples are business administration analysis, controlling, double payment and cash recovery analysis, enhancement of data quality, tax aspects, external auditing and "GDPdU" (principles of data access and verifiability of digital documents), compliance and IT. Nevertheless, many analytics approaches still frequently originate in internal auditing, because this looks at data globally from a corporate viewpoint to judge the effectiveness of internal controls for instance. So auditing must access data across departmental boundaries and both understand and analyze extensive process chains with their control points.
But what is the situation like, how are things handled in enterprises where no internal auditing exists? This is where we come to speak of small- and medium-sized business (SMB, and thus the name "Mittelstand") in which our experience shows that the existence of auditing is by no means implicit. In family-owned businesses in particular you find the expression trust-based organization for "traditional reasons". If at all, in German SMBs you find combined roles: The person responsible for controlling, in the course of accessing company data, at the same time handles auditing activities "on the side", so to speak.
Now, developments like big data, Industry 4.0, digitalization of business processes and the continuing globalization that comes with them also impact German SMB – teamed with new or intensified challenges that emerge for an internal control system, data quality, interface problems, compliance questions (and immanent liability risks for company management), or users and their authorization.
Our experience, namely that in German SMB matters of risk management, data analytics and internal auditing have often not come as far as their prevalence and importance would call for, is also underpinned by numerous publications by different instances, like the information value index from PWC and Iron Mountain, ascertaining that only one in four businesses works with a data analyst, or the report "Data Analytics in SMB" from Deloitte, which speaks of "a minor degree of automated and standardized information". The import of these statements becomes even more significant when you think that, according to the Institute for SMB Research, 3.62 million businesses were reckoned to be SMBs in 2013, making 99.6% of all businesses in Germany.
So in SMB, as we see it, in many cases things do not revolve around the challenge presented by integrating or growing data analytics in existing auditing but creating awareness of the need – or, to stay with our vision, the implicitness – for risk management and data analytics (motivated by both auditing and business management aspects). In our opinion for many, in the first step, it is not so much a matter of establishing predictive analytics or complex business intelligence mechanisms to highlight future scenarios for decision aids, but of understanding and analyzing the given data situation. Last but not least, the cost of establishing and implementing analytics or analytics systems is another subject, as postulated by the above-mentioned Deloitte study: "So for SMBs it is especially important to find the right mix of system complexity and related cost."
First you have to create awareness that the presence of a data analyst should be implicit. (Instead of "data analyst" you could also use "auditor with knowledge of data analytics", "chief data officer" or other synonyms to attach more to the subject – as it deserves – than pure auditing.) Once this awareness is created or in place, SMBs come up against their first challenges:
- How can really effective auditing or, to put it quite simply, an analytics unit be set up?
- What would go into a job profile, especially as regards knowledge of information technology, business management, accounting, risk management and auditing?
- What software solutions are needed to support a newly created organizational unit in coordinating with materials management, accounting and marketing systems that are already in use?
- What questions can and should be covered by data analytics in the first place?
- How are results to be interpreted, and what conclusions are to be drawn?
- How can the necessary expertise be transferred, properly structured –like through workshops or special advanced training?
It emerges that this task calls for a mixture of managerial consulting and operative support. To serve the subject of establishing data analytics in SMB as intensively as it calls for, in scope and importance as we see it, at the end of last year we initiated dab: Mittelstand GmbH.
This combines the named aspects with dedicated personnel too:
Managing director of dab:Mittelstand GmbH is Guenter Mueller, who has long been involved in data analytics in auditing, including a senior position at Bayer AG, where for many years he played a major role in promoting this function in corporate auditing. He knows what it means for management to establish and administer auditing aided by data analytics, he is familiar with the corporate risks to be examined and the procedures in tracing findings, and deriving appropriate measures.
He is assisted in this by the dab:GmbH team with a portfolio of software for data extraction, data analytics and audit management plus a large selection of standard analyses ready for implementation. With our expertise and many years of experience, understanding business management and technical demands and implementing well-thought-out data analytics solutions to these demands, we deliver the technically operative functionality of dab: Mittelstand GmbH.
To summarize: Establishment of data analytics in SMB yes, but not exclusively, with risk management and auditing background, by a mixture of managerial consulting and operative support in setting up an analytics unit and implementing analytics tools – the entire cycle supported by dab:Mittelstand GmbH with its expertise.
Upcoming at this point we will post a small series of articles by Guenter Mueller in which he illustrates his personal perspective of the importance of data analytics, risk management and auditing.
If you have questions or comments, we would, as usual, be pleased to receive them. To find out how to contact us, visit the Internet site of dab: Mittelstand GmbH www.dab-mittelstand.de , with further information here in the blog in the coming weeks.
Stefan Wenig – dab: Daten - Analysen & Beratung GmbH