Saturday, October 9, 2010

The TechnoSphere 2: Business Intelligence

  1. Business Intelligence: What is it? Where's it headed?
Where we are:
·         Our systems are not as integrated as they should be. This is the crux of the problem so many small business owners face with their business intelligence or information systems. You start on a system; because it’s cheap. Because it is the system your accountant uses, or at very least, the system your sister-in-law who has graciously agreed to do your books is vaguely familiar with. By the time you get to adding programs they have to integrate with your existing software and systems because that is where all the information lives. So you end up adding on to the existing program/system with other systems that are sold by the same company, or at very least will work the system you have in place. Is it the system you would have purchased or designed at the outset? Likely not, but few small business owners had that advantage when we started nearly ten years ago. The fully integrated system, allowing for substantial growth and long term information tracking, were extremely cost prohibitive and relatively industry specific. Just starting out the resources were such that those programs and systems were quite simply not an option.
·         Our accounting system was also chosen because it was one of the few systems that would support assemblage of raw materials to finished goods. The most cost effective, and widely used, systems- such as Quickbooks- were modular based. At the time you could purchase a module to do the additional accounting you required. Needed inventory tracking? There was a module for that. The catch was that they would only track finished inventory, not raw inventory. There was no module available for assembling the raw inventory and then tracking the raw inventory, work in progress and finished goods. Mind you the need for this tracking was highly theoretical as when we started out we didn’t have the info structure to a) input the information, b) analyze the out put or c) need the system at all. But given that our business was manufacturing in nature it made sense we would eventually need that capacity, and we eventually did.  
·         So, by the time we get to adding other information systems, a CRM for example, we had only one choice. There was only one major CRM on the market that would work with our accounting software that didn’t require a ton of additional employee exporting and importing through an intermediary program. Even then the CRM software’s integration with the accounting software is limited. We don’t have access to specific purchasing information for the client in the CRM software or access to notes and emails sent in the accounting software. The systems are linked only tenuously.
·         In yet a third system of customer input the information a client inputs through all of our web forms then has to be imported separately into the accounting system and the CRM software respectively. In addition the shopping cart used is yet a fourth system where information must be coordinated.
·         Then, of course, there is the additional system of email, which while becoming antiquated, is still a primary form of business communication for many folks. We have an email server but also have to back up the individual email systems as part of the information lives on the individual machines themselves, not in the central server. This is still an upgrade from our first few years of business where we didn’t have a server and all of our information lived on secondary hard drives manually installed in individual computers.
·         Then there are the additional systems like our server, networking, inter office messaging software, server and information back ups (internally, externally, in the fire box and cloud based). There is also a room full of filing cabinets. Yes, that’s right, filling cabinets. Over sixteen of them to be specific housing information and physical copies of images for thousands of images and clients. We have a print business where clients are long term clients. We have a large percentage of repeat business which we encourage by offering exceptional customer service and a commitment to quality. So, if a client calls up after a few years looking to re order we need to provide a product that is somewhat approximate to the previous product ordered. If they order a new product instead, or in addition, to their previous order the new product as well should be in line with their previous order. Herein lies the rub. We have not, as of yet, constructed a way that our digital records can compensate for the physical prints we keep on file. Sometimes a client ordered on an older technology, or with a different substrate, or an old ink formula and their print is vastly different then our current technology. How do you translate a color proofing job to a digital format? Can that even be digitized? If so how would one digitize it?
·         The same goes for the paper copies of invoices etc we keep. Can they or should they be digitized? How does one go about digitizing sixteen filing cabinets worth of information? Is it worth digitizing them with man-hours required verses profit generated from having the information digitized? Would it be better just to proverbially cut our losses and start digital from this point on? Does physical storage have a place in the digital world?
·         We have several remote versions of our systems which is useful when running a small business. Our systems can be operated remotely and work can be done from any location with a wi-fi connection.
·         While we have done a relatively good job of maintaining our systems and trying to have them “talk to each other” the grand notion of all the information being available at any time is still exactly that- a notion, not a reality.

What we can do to improve immediately:
·         Moving to more integrated software/information. We purchased our CRM software almost two years ago now which likely means there have been upgrades to the software itself. A greater level of integration and information may be available with a simple upgrade.
o        While information in the CRM software (notes, documents, tasks etc) are not really necessary to appear in the accounting software it would be helpful to have the information from the accounting software (items purchased, cost per item, total purchase history etc) readily accessible from our CRM software.
o        Additionally it would be nice to have a more automated version of the CRM software. Initially when the software was purchased we were told it could automate some functions based on input in the accounting system, when in fact this wasn’t the case. Automation of those customer contact systems would be incredibly helpful and a huge time and resource savings.
o        Further integration between our web forms and our accounting system and CRM software may also be possible. The web forms, and shopping cart, were created several years ago and there is likely an updated version of both of them that would interface better with the other information input systems.
o        The shopping cart we currently use has an updated version that looks like it will integrate with our website on levels that we have previously had difficulty with. We ship from various zip codes to various zip codes and have various weights and quantities for our products. Previously the two main problems in constructing a shopping cart were the number of items and the complexity of shipping. Since the marginal cost of information storage has become virtually zero the number of items offered in most shopping carts has become unlimited so the number of items restriction has been eliminated. With an upgrade to the premium service it looks like we may also be able to address the complexity of the shipping issue with an availability of 20 shipping zones and various shipping calculators.
§         How will the shopping cart interact with our current accounting and CRM software?
§         Our accounting software came out with a shopping cart module, we need to investigate if this module would be a better choice with our current system
§         Are the shopping carts optimized for mobile viewing?
§         How easy are they to institute with our current site? Do we need to higher out the incorporation of the new cart or can we have one of our current employees do it?
·         It may be time to upgrade our system entirely. There is a new version of our current CRM software (new version that is supposed to combine online shopping system and e commerce, Google analytics, business analysis, customer contact and CRM software while also offering cloud based portions of applications and storage. Perhaps an upgrade to that software would be an instant solution to the dilemmas of our current systems.
·         Creating a customer service system. In addition to purchasing and deploying the new software our business model needs to incorporate the information and input generated by those new systems. They say a system is only as good as the information you put in it but it is only as useful as what you do with the information that comes out of it.
o        Where and when are we going to find the time to learn about the new technology and implement it? Not only is it difficult to find time to research the new technology but then you have to find the resources to purchase the technology. After all of that you need to construct the system that works with the new technology, either as support to or interpretation of the information going into or coming out of the technology. Then you have to learn the new technology as well as teach all of your employees the new technology. Each new technology is a huge resource commitment only part of which is the financial investment.  
o        Making a plan for transition to the new technology/system. How to dovetail the deployment of the new technology to have as little disruption of our services and functions as possible.
o        How are we going to scaffold a listening info structure?
o        How are we going to transition out of owner/operator into more of an owner only capacity?
o        How are we going to translate our current commitment to customer service and quality into a business wide system rather than an employee dependent relationship?

Where things are headed:
·         Accessibility of information for small business
o        Will data mining decrease or increase the gap between business sectors? Previously it was only the very large business that had access to the kind of in-depth customer information and demographics that have now become almost common place with the proliferation of social media. But currently that information still comes at a premium or through an intermediary. As the information, and availability of systems to access the information, continues to be come more interconnected and available will the access to that information become more tightly controlled or less? In other words will the power of Facebook be increased creating a new information oligarchy (as asserted by Michael Wolff) or will in be decreased toppling the social network giant before it ever has a chance to become a profitable social network giant?
o        Back to our analogy of all walled cities the information availability is like a map. The map tells you where the cities are and what the cities have to offer. Where should I best go to schlep my wares? The question is will there be one or two map makers that have the control over the maps or will there be a million roadside stands where you can by the maps?
·         Accessibility of successful businesses systems for small business. There was an article I read once about this ceiling for small business. How there is a large percentage of small business were never likely to make a million dollars in sales. They simply didn’t have the tools to grow beyond that milestone. Furthermore the longer a business said under the million dollar mark the more likely they were never to reach that mark. As I mentioned it is hard to upgrade your systems when you have started with a system that doesn’t coordinate well with other systems. But how will that change when the system you started with does coordinate well with other systems? What will the future look like when the system you started with is the big business system only on a small business level (SaaS)? What will the business ecosystem look like when everyone started with systems like that? When most business have a business model that not only allows for almost infinite expansion but also for innovation?

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