Your Business Software should fit your Business.
Using Internet Technology Within Your Company.
What the Internet can (and can't) do for your business.
Analyzing your Office Computing Effectiveness.
How to buy computers for your business.
Making Your Business Computers Work For You.
The manager of a local lending office bought a software program for his brokers to use when preparing applications. It had every feature imaginable. It could compile, track, and automate every step of the process. It came with two user manuals and a training manual, as well as a video tape for additional training. The manager hoped it would boost productivity. After all, the software had been lavishly praised in an industry magazine.
The manager watched the brokers struggle with it for two weeks. He encouraged them, told them to give it a chance, and reminded them that it was "award-winning" software.
At the end of the two weeks, the brokers voted unanimously to discard the software and go back to their "tried and true" method of manually processing loans. The general consensus was that the software was too complicated. The brokers were spending too much time trying to make the software work.
These brokers are experts at lending money. They are not software experts. They don't want to be. They just want a software tool that lets them process loans quickly. If the software makes them work harder, they'd rather do it manually.
This is a typical situation in many businesses. A company purchases a generic software package designed for an industry (such as lending) or for a specific function (such as inventory control). The software is installed, the employees are trained, and weeks are spent inputting the company's data. And then as they begin to use it, they discover that the software doesn't really fit the way the company operates. Maybe the company does a lot of business with tax-exempt organizations, but the software charges tax on all items. So what does the company do? They start "fudging" the software. They adjust the price of items so when the software adds the tax it will come to the correct total. Then they re-type the printed invoices to display the correct total with no tax. In effect, they become slaves to their software.
So what is a business to do? Consider having custom software developed for your business. When you have your own software developed, you decide what features you want in it, what reports it will contain, how users will input data, etc. You will be the architect of the system.
Another advantage to custom software is that you will be working directly with the developer, both during the design phase and after it's installed and running at your company. As your people begin using it, they will invariably have suggestions on how to improve it. As these suggestions come in, you can work with the developer to add them to further improve your software. This type of "fine-tuning" will ensure that you end up with a system that your people enjoy using, fits the way you do business, and can be used for years.
Your business is unique, and if you have to bend it to fit your software, I guarantee your people are wasting time that they could be spending on more productive tasks.
Despite all of the press the Internet has received for the past three years, few articles have come right out and described what it can and can't do for a business. So we'll do that now.
Before beginning our discussion, let's agree on some facts:
1.
The Internet is a communications tool, and nothing else. It is not a retail store, or a mall, or a social setting. All you can get from the Internet is information.
2.
Everything a computer can do can be done manually; however, the computer can usually do it faster, cheaper, and with less human effort.
3.
The Internet will not change your core business; it will change the way you exchange information. If you make widgets today, you'll still be making them after you start using the Internet.
So, combining those facts, we can see that the only benefit to the Internet can be that it provides a means of communicating either faster, cheaper, or with less human effort than other methods.
Bingo. That's it. Don't let that thought escape. Don't let is be lost among http, ftp, ecommerce, ERP, Mbps, and all of the other cyber-terms that fill the magazine articles. The only benefit to the Internet is that it provides a means of communicating faster, cheaper, and with less human effort than other methods.
And then add to that thought: As a business owner, you don't need to know every technical term and specification to profit from the Internet. You just need to define your communication needs, and then you can investigate ways of using the Internet to accomplish that communication.
For example, maybe you maintain an 800 number for your distributors to call in their orders. You can now develop a web site for them to use, saving the cost of the 800 number and the operators who take the calls.
Here are some other communication methods that a web site or email could take the place of:
• Orders that are currently received via fax or telephone.
• Inquiries about order status and tracking.
• Many customer service inquiries could be answered on-line.
• Job applicants can fill out applications before visiting.
Of course, you can't just cut-off the existing method (like the phone or fax), but you can encourage suppliers and customers to start using the Internet by offering discounts or faster response times.
Then there are more advanced ways of using the Internet, like automating your inventory system to re-order (with no human involvement) when certain levels are reached. You can also configure your systems to perform automated searches for information, such as news releases about certain companies that will affect your investment decisions.
These are just a few examples of using the Internet. What is important to remember is that your business has unique communications needs, and that the Internet is a communications tools that can be used in many ways.
The Internet and The Telephone
To get a perspective on the impact of the Internet, consider the early days of the telephone, when only a small percentage of businesses had telephone service (the percentage of residences was even smaller). Businesses had to make a decision about spending money on a new technology that few people really understood. Many people thought it was a toy and couldn't see the telephone becoming an integral part of everyday life.
Picture yourself as a business owner back then. You've never used a telephone, you don't know much about it, and you don't know how it can be of use to you, especially when you know that few business and customers have one!
But slowly, more businesses and residences begin to get them, and soon it becomes a necessity of doing business. Some companies flourished, and others failed, based on their use of the telephone. Well, the Internet may prove to have the same effect on today's business, and you face the same decisions as your counterpart 60 years ago.
There are a lot of options available when buying computers for your business, so let's run through some common scenarios:
1. You want to create simple correspondence and get on the Internet.
2. Your receptionist is typing 40 letters and invoices per day on a typewriter.
3. Your firm faxes 100-200 press releases per day by stationing an employee at the fax machine for 6 hours.
4. You employ 10 operators to handle 500 daily telephone inquiries from customers and vendors.
5. You currently have 10 PC's in the office, each with a printer, 5 with modems on separate phone lines, and your phone bills and maintenance costs are killing you.
Here are the solutions to each of these situations.
1) You want to create simple correspondence and get on the Internet.
What to buy: For these simple needs, buy a low-end PC and printer (Low-end does not mean inferior; it means if you have a small yard to mow, you should buy a push mower, not an industrial tractor). Call some computer suppliers and explain that you only need to write a few letters and get on the Internet. Tell them you don't need their most powerful and expensive computer. A good supplier will agree with you; an unscrupulous supplier will try to sell you the industrial tractor.
You'll need a modem in the PC to get on the Internet (almost all computers today are sold with a modem already installed). You'll also need a word processor program to create the correspondence. A word-to-the-wise: Unless your correspondence is complicated or includes a lot of graphics, you can use the WordPad program that is built in to all versions of Windows and save some money.
2) Receptionist with a typewriter
If you're in this situation, don't feel alone; many of the small businesses I visit still do their correspondence the old way. On one hand, this seems ideal: the typewriter is paid for, the employee knows how to operate it, and the letters get sent each day.
But on the other hand, you are missing out on an opportunity to make a small investment and get more work out of that employee forever. Let's say you buy a PC and printer for $1500. Now your receptionist can create letters and invoices on the PC, and can do it much faster because she can use previous documents as templates for new ones, just by changing the customer name and some other information. And instead of typing each envelope manually, she places a stack of envelopes in the printer and issues one command to print all of them at once.
The result? She now gets her correspondence done three hours earlier each day, and she spends that time making sales calls, which in turn increases your revenue. Therefore, by purchasing the PC and printer, you get a new sales rep for three hours a day.
What to buy: Buy the same low-end PC and printer described in the previous example.
3.) A firm that faxes 100-200 press releases per day.
If you regularly prepare a single fax to send to a large number of recipients, there's no question that you should be using a computer to do it. If you regularly send a lot of different faxes to a large number of recipients, chances are you should also be using a computer.
Let's say you send out a one-page fax to 150 recipients daily. Each morning, as soon as the daily fax has been prepared, you put an employee on the fax machine for almost 4 hours (that's 90 seconds per fax). If that same employee was using a PC to send the fax, he would spend 4 minutes instead of 4 hours, saving 3 hours and 56 minutes to do other things you need done.
If you need to send a lot of different faxes to a lot of people, your employee can also send them from his PC. As soon as each fax is prepared, it will take him about 15 seconds to send it. And if the second fax is ready to send before the first one is finished, the computer will still accept the second job, and hold it until the first one is gone. So your employee can prepare and send each fax "rapid-fire" without having to wait for the previous job to be finished, as he would on a manual fax machine.
What to buy: If you're just going to send faxes and create simple correspondence, buy the same low-end PC described in the previous example, with a fax/modem built-in. You should also get a low-end printer so you can proofread the faxes before sending them. And you will also need to buy a fax software program that will run about $100-$150.
4) You employ 10 operators to handle 500 daily telephone inquiries.
If you're manually handling a lot of regular inquiries, either from vendors or customers, the first thing you should do is survey them during each call to determine how many would rather use the Internet to obtain the information. You may be surprised at the number of them that will support the idea.
Assuming you get a 10 percent response, you can consider spending $5,000-$15,000 on a secure website that will allow each contact to enter a user name and password to check the status of their account. The website will draw the requested data from your existing records, so you'll know that the information is up-to-date.
Now, $5,000-$15,000 may seem pretty steep, but consider that you'll be decreasing the number of telephone calls, allowing you to move one of your phone operators to another area, such as sales or marketing. This should allow you to generate more sales, increase revenues, and quickly realize a return on investment for the website.
What to buy: The details of this solution go beyond the space I have here. You'll need a server, a full-time Internet connection, and some up-front programming work. Consult some vendors to get a feel for cost, timeframe, etc.
5. You have 10 PC's and printers, with 5 phone lines for modems.
If you have multiple PCs that need to be able to print and/or have Internet access, consider installing a network. By installing some cabling and network adapters, and using the built-in network capabilities of your existing operating system, all of your PCs can share one printer and one modem connection. And another advantage of networking is workgroup applications, where your staff's schedules can be synchronized and other tasks can be automated.
What to buy: Again, call some computer vendors, explain what you want to do, and ask them to do a cost comparison of a network solution vs. what you are currently paying to maintain your separate printers and phone lines.
Summary: These are just a few examples of the many ways you can run your business more efficiently using computers. And while I admit that your staff will experience some grief during the learning period, the long-term benefits will quickly outweigh the grief.
Here is a nutshell description of E-commerce:
• E-commerce is the use of computers to market, sell, or purchase goods and services.
That's about it. And it's not new. However, until the recent availability of the Internet, E-commerce took place only between companies that could afford to pay thousands of dollars per month to lease connection lines.
But that's all changed now. The Internet lets everyone get in the game by providing a cheap, around-the-clock way to connect computers together. And with the advances in low cost computers and software, any company can advertise and sell over the Internet, or use it to communicate with customers and vendors.
So what do you do about it? If you're a business owner, and you're wondering what E-commerce will do for you, the following exercise should shed some light.
First, let's understand that the two major areas of E-commerce are: ·
Business-to-Business. ·
Consumers.
There's a big distinction between these areas. Business-to-Business transactions can be cold and automated. For instance, when inventory levels at General Motors get to a certain level, replenishment orders are automatically placed with approved vendors. That's as automated as it gets; no people involved, just computers.
I believe that the real advantages of E-Commerce between businesses are still unfolding, and that a big need exists for automated information sharing between complimentary businesses. A good example is a realtor, who could be a member of a group consisting of a moving company, furniture store, insurance agent, etc. When the realtor takes on a new client who's looking to move into the area, the others in the group would be automatically notified of the new potential customer. So instead of that customer having to call around to find these services, each business in the group can notify the customer that they are ready to serve them.
On the Consumer side of E-Commerce, it's a crapshoot if you want to make money selling products. It's like a new type of mall, with a flea market included. And in my opinion, it's a tricky place to do business. Millions of people are online every day, but no one knows where they go. Despite all the hype about Internet stock prices, almost all of the companies lose money. Amazon.com lost $124 million on sales of $610 million last year. (Yet the total outstanding stock is currently worth $29 Billion dollars.). So from a profit point of view, it's just another company losing money. And if a company with Amazon's advertising budget and name recognition can't make a profit, I would think twice before diving in. There are profits to be made on the Internet, but do a lot of research before investing heavily in an online store.
So in conclusion, my opinion is that the best use of the Internet right now is to move information between businesses, thereby cutting the cost of each transaction. And while it's inevitable that the Consumer side will continue to grow, the majority of online merchants have yet to figure out how to make a profit.
A fantastic (and mostly unknown) benefit of the Internet is that any company can use free Internet technology to distribute information on its internal network, at substantially lower costs than traditional methods.
The use of Internet technology eliminates much of the cost of traditional information systems, which included a high-priced data server, plus the installation and maintenance of custom software on each user's computer. Depending on how many users you have, this could add up to big money.
On the other hand, consider this: Internet technology provides an information system on which data can be easily published and easily accessed. In addition, every computer sold today has Internet software pre-installed. So why not take advantage of it?
A Quick Technical Primer:
The Internet is based on a software protocol called TCP/IP, which allows email messages to be sent and web pages to be accessed. Without boring you to tears, it will suffice to say that any computer network that runs TCP/IP can take advantage of these features. And since 99 out of 100 existing networks include TCP/IP, the odds are good that your network qualifies.
Once you have TCP/IP running, the next step is to establish one computer as the web server. If you have an existing Windows NT server, web serving is included and only needs to be enabled. If not, you can purchase an inexpensive web server software package for a few hundred dollars and install it on any PC running Windows 95, 98, NT, or 2000.
Once you have the webserver software installed, you are ready to start distributing information. Your users simply enter the webserver address into their pre-installed browsers, and they will have access to all of the information you choose to publish. If security is an issue, it is easy to secure all or parts of you internal website depending on which user is trying to access it.
Add a Database
To take the project a step further, you can add database capabilities, which will allow users to enter data as well as read it, making the system a full information system that is customized to your company. This requires a little more expertise than a simple "publish-only" system, but again the built-in cost-savings can go a long way in offsetting the cost of the project.
There are a number of ways to implement such as system. A good example can be found on the internet at http://www.scottdemo.com. This site illustrates how Internet technology can be used as an information system. The site includes instructions on how to obtain a username and password to view the online demo.
Easy publishing. Easy Access. All your computers pre-configured at no cost. Is that what you'd like from your company's information systems? If so, explore the benefits of using Internet technology at your company.
Last week we talked about how most office computer systems are under-utilized, and that making some changes can cut costs and increase revenues. Today's topic is how to perform an analysis to recognize where these changes can be made.
There are two main areas to look at: (1) how do your people spend their time, and (2) what are you spending to keep your office equipment running? These are the areas that provide the quickest payback when new computer functionality is implemented.
How do your people spend their time?
In many offices, you don't have to look very far to see areas where automation will allow your people do the same amount of work they're doing now in less time, thus freeing the remainder of their workday to get more work done. Do your people spend a lot of time digging through file cabinets? You'll save time by computerizing your records. Do your people fight for the fax machine? You'll save time with PC faxing. Is a lot of time devoted to keeping binders or listing books up-to-date? You'll save time by disbursing this information via office email. Is a lot of time spent answering inquiries from customers and vendors? You'll save time implementing a PC-based faxback system, or a secure Internet Web site that your customers and vendors can use to review their accounts.
The payback on these changes varies depending on the expense and complexity involved. Consider a public relations firm that faxes 100-200 press releases per day by stationing an employee at the fax machine for 6 hours. By installing a $100 fax program on a PC, the employee can now spend less than one hour setting up each day's faxes, and while the PC automatically sends all the faxes, the employee now has 5 hours a day to devote to new projects. The return on investment is immediate.
However, other changes will require more time and expense to implement, and the payback period will be longer. Consider a firm that employs 10 operators to handle 500 daily telephone inquiries from customers and vendors. By spending $5000-$10,000 to develop a Web site for inquiries, the telephone inquiries are cut to 400, and two operators are moved into the sales department. Looking at it this way, your investment has added a convenience for your customers, and has increased your sales capacity, without increasing payroll or other expenses. Payback will probably occur in less than six months. And the telephone inquiries will continue to decrease as more of your customers start using the Internet.
What are you spending to keep your office equipment running?
This can be assessed quickly by your bookkeeper. Add up your expenditures for the last six months on fax machines, copiers, and printers. You should include lease payments, supplies, maintenance contracts, services calls, and replacement parts.
You're probably in for two surprises: one, how much you're paying to keep things running, and two, that vendors such as HP, Canon, and Xerox offer all-in-one machines, which include fax, copier, printer, and scanner, starting at less than $500. So say that your maintenance contracts, leases, services calls, and supplies for your fax machine, copier, and printers are over $600 per month, plus the administrative nightmare of three maintenance vendors and suppliers. By networking your 10 PCs for $3000, you can install one multi-purpose fax/copier/printer. All users can fax/copy/print from their PCs, your maintenance and supplies expenses are lower, and you have a single vendor for maintenance and supplies. The return on investment is 6-9 months. And you also gain all of the advantages of having your PCs networked (file sharing, office email, etc.).
Conclusion
There are plenty of ways that your computers can make your business more profitable. And to discover what you can do in your office, just take a look at what your people spend a lot of time doing, and what it costs to keep them equipped.
It would be hard to find a business today that has not been affected by the computer age. Desktop PCs are as integral to the office as the telephone, copier, and fax. And yet, the desktop computer is notoriously misunderstood and under-utilized.
Ask a business owner about his fax machine, and he'll say "What about it? I put a stack of paper on it, punch in a number, and it's gone. No big deal."
But ask him about his computer system, and many a business owner will say things like:
· "I know we're not using all of it's capabilities."
· "I don't even know half of what it can do."
· "I want to throw it out the window at least once a day."
This is a sad state of affairs, and it's unnecessary. When set up properly, desktop PCs can easily handle any business function, and can integrate these functions to maximize your staff's efficiency. And you probably already own the equipment you need to do it. If your office computers were purchased in the last 4 years, they can likely be setup to integrate your correspondence, bookkeeping, telephone answering, faxing, Internet access, timekeeping, scheduling, paging, and just about anything else you can think of, with little or no modification.
The Ideal Business Computer Setup
In a fictitious property management office, there are six PCs for the administrative and sales personnel, one for the receptionist, and one for the owner.
All of the PC's are networked together. While this adds about $250.00 to the cost of each PC, it quickly pays for itself in efficiency and savings. Right off the bat, the network allows everyone to share one high-speed printer and one or two fax/modems, saving the cost of a separate printer, fax/modem, and telephone line for each user (up to $800 per PC, plus multiple telephone charges).
The network allows the use of interoffice email, so people can quickly and easily communicate from their desk. The network also lets them to keep their schedules in a common scheduling program, which allows users to view each other's schedules (or not, if security is an issue). It also allows the owner to review the staff's workload, and add meetings and sales calls to any one's schedule.
All customer, vendor, and company data is kept in a common database, which is accessed from easy-to-use displays on each user's PC. When talking to a client or prospect, your sales reps can quickly view the listing sheet (as well as any confidential information about the property) on their PC display. These displays draw from the database, so they are guaranteed to be accurate, eliminating the problem of keeping everyone's listing book up-to-date.
Access to different types of data is set by password, so the owner can restrict access to confidential information. And certain events, like the addition of a newly available property, can be configured to automatically send an email to all sales reps to notify them of the new listing.
The receptionist has a scanner attached to her PC, so when a new property becomes available she can easily scan the photo, add it to the property listing sheet in the database (triggering the notification email to all sales reps), and broadcast fax the listing sheet to a selected group of rental brokers for the area.
And finally, perhaps the most important function: a business owner can easily review all types of custom charts and reports to see where money is made and where it is lost. What types of property yield the best net profit? Which move the fastest? Which of your maintenance companies has the fewest callbacks? Which of the 3 newspapers you advertise in results in the most sales? Are the billboards worth it? Most businesses, whether they mean to or not, track the raw data needed for these types of reports, but they lack the integrated database needed to extract and compare it.
A Final Word
These capabilities are within reach of the average business, and often without purchasing a lot of new equipment. And while there is some expense to getting it all configured, the long-term savings may make it money well spent. Next week we'll discuss how to complete an informal cost/benefits analysis to see where your computers can improve your bottom line.