Two conversations this week set me thinking about company information.The first discussion was with a finance director whose company had just posted some semi-decent results. The results partly covered the time before the credit crunch really started to bite. He was moaning slightly because the City had discounted the decent figures (and so the share price) his company had produced. The City analysts- despite his assurances to the contrary - were worried what the credit crunch was going to do to the company's performance for the next set of figures. When there is so much general gloom around we can all get enveloped in the fog of despond.
A day or two later another conversation about information, this time with some professional information providers. Company information in the UK relies heavily on statutorily posted data which is then taken, sliced, diced and generally analysed in whatever way you want. This is a highly sophisticated, quality-driven and established business model in the UK and is one of those generally unsung activities that underpins a successful modern knowledge-based economy. However even the information providers were worrying, not about the quality of the data which they had to work with, but with its timeliness. In a fast changing environment which we have witnessed recently, commercial conditions are highly volatile. The problem is how do we cope with this volatility? The idea of quarterly reporting as practiced by global corporations for most companies is complete overkill. On the other hand basing decisions on financials that are months if not years old, on the off-chance that they are still relevant today could be a dangerous game.