Industry Makes a BigBy Larry Dignan | Posted 2005-10-19 Email Print
If you're trying to turbo-charge your business, how well you manage technology matters less than how you manage information. Here are some of the 500 ways the Baseline stars did it.Difference">
The Baseline 500 also provides a window into which industries are performing welland producing returns for investors. Strassmann plotted the companies in the Baseline 500 against their stock market valuation minus shareholder equity as reported in their annual reports. The correlation between the net stock market valuations and Information Value-Added was a very high 86.3%.
Another discovery: Food companies are getting more productive. Aramark Corp. (No. 61), which provides services for universities, sports facilities and other venues, was the leading food purveyor in the rankings, followed by Sonic.
Technology companies are also getting better at managing their own. The 2004 rankings featured 20 hardware, software and services giants. This year, 30 technology firms made the list. SunCom Wireless Holdings (No. 32), Cincinnati Bell (No. 91), Peregrine Systems (No. 93) and Lucent Technologies (No. 105) were among the leaders. For Lucent, which is focusing on services instead of telecommunications equipment, Information Productivity of 95.3% is quite a turnabout considering that the company in 2002 lost $11.9 billionan amount on par with that year's revenue. What changed? Lucent slimmed down, cutting operating expenses to $2.57 billion in 2004 from $8.5 billion in 2002. Lucent reported net income of $2 billion for 2004 on revenue of $9 billion.
But technology companies still aren't the best at managing information; not one cracked the top 20 for 2005.
PAUL A. STRASSMANN
Paul created and trademarked the Information Value-Added and Information Productivity formulas behind the Baseline 500 rankings. His career in technology, which began in 1956, includes stints as a top information-technology executive at Xerox, General Foods, Kraft, the Department of Defense and NASA.
Strassmann is president of The Information Economics Press and senior adviser to Science Applications International Corp.; he is also Distinguished Professor of Information Sciences at George Mason University's School of Information Technology and Engineering.
He has written numerous articles and books on information management, including Information Payoff: The Transformation of Work in the Electronic Age (1985) and The Squandered Computer (1998).