Technology and the Bottom Line
December 19, 2004 9:29 PM   Subscribe

For the IT/Corporate savy.....
What ways has your company made use of technology to improve the bottom line? One of my charges as IT Manager is to find ways to use technology to make the company more profitable. What have you found that worked well in your situation. We are a small/medium sized company that are basically manufactures reps for shelving/folders/imaging/fileroom management. What can I offer my sales force to make them more efficient?
posted by keep it tight to Work & Money (13 answers total) 1 user marked this as a favorite
I work for a school district, so my "bottom line" is a bit different from yours. However, the effective use of IT has enabled us to significantly improve our business systems by replacing tedious manual data entry and reporting with automated processes. Our data is more accurate and can be disseminated more efficently through e-mail and web-based reporting.

Whoa, that sounds like a sound bite! Still, it's true: although my district is growing rapidly and although the State and the Feds are becoming more demanding in their reporting requirements, we're able to hold the line on costs and relieve the staff of their dullest tasks thanks to our IT systems. I imagine any business can benefit from that.
posted by SPrintF at 9:41 PM on December 19, 2004

I think it comes down to:

1) Automate, automate, automate.
2) Collect data, collect data, collect data.
3) Communicate, communicate, communicate.

IT that enables these three quickly become invaluable.
posted by nixerman at 10:25 PM on December 19, 2004

Okay, I'm about to start sounding a little crazy, especially as I'm a programmer. Even worse, I'm going to answer at a tangent to the original question.

In my experience, businesses rush into new technology waaay to quickly. They forget that new solutions bring new problems. This is particularly true with software. Automate all you want: 2 years after implementation you will realise your new systems come with their own inbuilt set of issues. And I'm not talking about easy stuff like bugs.

You will also discover that highly-automated businesses lose their ability to deal sensibly with mistakes, errors and unforseen events. Software systems operate at inhuman levels of precision and efficiency. When things go wrong (and they will), people will panic, wasting hours upon valuable hours in a fruitless search for answers.

As an IT manager, you're more or less obliged to seek technological solutions to the challenges your company faces. However, my humble suggestion is simply this: prolong your search and recognise that often the best solution lies in making sure that staff have a strong belief in their work, and an understanding of exactly what they are meant to achieve. This is more valuable than any software or technology.

I apologise for not offering an answer more in line with your expectations: I'm sure there are many other people who will make very good suggestions, such as issuing your salespeople with PDAs or Bluetooth-enabled mobile phones or something.
posted by Ritchie at 1:00 AM on December 20, 2004

I'm in the same role as you are in my company. I saved money by switching some of our server infrastructure from M$ To RedHat. This greatly reduced the amount of "Hands On" time we've needed to spend on sysadmin work and gives us (IT) time to do other tasks.
I also saved a bit of money on some of our business apps by playing one vendor against another to get better license pricing. Even if you're bargaining with M$, you'll be surprised how much they'll discount your pricing to keep you from going to an open source solution.
Also, thoroughly demo/test any business system before buying it. We tried a number of employee/project time tracking apps before we found one we liked. I setup full scale tests where the users can try the system and then I get their input on which they like best. Also keeps them from whining when you deploy it because they helped pick it out.
posted by white_devil at 5:43 AM on December 20, 2004

Also, I forgot to mention that you might want to check out
It's a great hosted solution for a sales staff to use for CRM without adding extra hardware/software for you or your staff to support. Most of the sales folks I deal with really love this service.
posted by white_devil at 5:56 AM on December 20, 2004

There are a few key areas to focus on, and it is important to realize you can't put a price tag on all of them.

1. Data collection and reporting. Centralize sales data in a well designed database, make the data upload process easy for sales teams, and produce meaningful reports to highlight strong points and weak points in your marketing and sales planning.

2. Improve customer satisfaction. Offer online support pages, more efficient online ordering capabilities, have a clear and concise web site personalized for individual customers.

3. Improve employee satisfaction. Lowering employee turn-over lowers overall costs. What do employees want? An easy "VPN" solution? Try RPC over HTTPS. Consider a program where employees can buy computer equipment using the company's supplier and pricing. Set a scenario that outlines your limitations, then ask the employees for concrete ways IT can make their life better.
posted by McGuillicuddy at 8:20 AM on December 20, 2004

I'm with Ritchie: Keep human judgement in the loop, and don't buy into technology unless you really have a strong account for how it will save you money. I'll add that when new technology becomes a cost center, it will hurt not only the company, but your career.

While it's a challenge, it is possible to turn IT into a "revenue center" -- i.e., to find savings that, on the bottom line, contribute to margins rather than narrowing them. I had the privilege of working for a year in an IT org that did just that. Some of what they did was via technology, but most of it was new and sensible ways of thinking about the processes of IT. Here's how I boil down what they did:

Look at cost over more than the initial introduciton. Project both savings and cost out for at least a year, preferably farther, to see if it's really going to save you money to do x, y or z. E.g., a really big cost-savings in Q1 and Q2 might be followed by higher operational cost in Q3+. Make sure you understand if that's true.

Make your IT staff produce project plans, and make them stick to them or justify the variance. If they know they'll have to explain why they're deviating, they'll be more likely to make a realistic plan. At the same time, make it clear to them that producing project plans is only a tool to help them execute the task. Rebuke them not for deviating from plan, but for not planning -- i.e., not understanding their situation. (ob Eisenhower: "Plans are often worthless, but planning is everything.")

Be open to new ideas, but not too open. It may sound cool, but if it doesn't walk the fiscal walk, let it walk the plank.

Control your expenditures. This also relates to the project planning discipline: Make sure you really understand how much you're spending and where, and what benefit you accrue from that.

Get buy-in from your higher-ups that lets you make key decisions that will save money. Often in small to medium-sized companies, you will find department heads and director-level people outside of IT making committments on IT's behalf; if that's happening, it will be very difficult to control cost and quality of service in the IT environment.

Standardize your base. Make a plan to do it. It will cost money, but it will begin to save very quickly as your staff have to maintain fewer disk images and have more experience in specific support scenarios. Also, as painful as it is for me to say this: Police your configurations. Make users get specific need-driven variances for stepping outside the standard config. (By the same token, make sure that the standard config isn't so restrictive that people can't happily live within it.)

And most important: Build a conscientious, professional, self-respecting team. The best way to do that, IMO, is to make them make decisions (e.g. the project planning discipline) and then both hold them responsible for them, and make sure they see reward of some kind when the decisions are right. E.g., we had an institution known as the FBE ("Full Beer Equivalent"). It was a kind of informal demerit system, where we'd award these FBEs to one another for screwups, and then tot them up periodically. The "winner" got a trophy until the next FBE accounting (it was a bottle of Coors Lite under glass). It was a good tactic for us, because it allowed us to apply a gentle social pressure to perform without real stigma. (That said, it's hard to make things like that work by fiat; they need to emerge organically to work really well. FBEs had been an informal tradition for a while before anybody made a trophy.)
posted by lodurr at 9:54 AM on December 20, 2004

Forgot to make clear: Everyone making project plans should be accounting the cost as part of the plan. That's the only way to push consciousness of fiscal discipline down to the trenches.
posted by lodurr at 9:56 AM on December 20, 2004

I'm a vendor to many companies such as yours. In fact, my client base is 100% small to medium sized companies. I write custom web-enabled/based software applications, usually for sales organizations. This topic is near and dear to my heart. ;)

The first thing you should do is figure out what you're doing right now. What processes are manual? What processes are already automatic? What processes are a royal pain in the ass and cost someone else's admin assistant hours of his or her time every day for something that could be automatic? These are things that should be automated. You don't have to have some huge complex all-encompasing issue solver for these things; a tiny automatic program that queries a database somewhere or puts data into a database somewhere else will work just as well.

Keep in mind that no one else does business like you do. In the big scheme of things, your company's product is not your competitive advantage, it's your processes that are. It's your job to enable your company to build upon and improve those processes on a continuous basis. Your job is NOT to implement SAP or another organizational management package that will force you into a different way of doing business.

Another thing to keep in mind when choosing software or choosing a design for custom software is that you want to leave things as open-ended as possible inside of your organization. Locking things way down will only make you have to loosen permissions later as people's job descriptions morph and change; leave things open-ended will allow people's job descriptions to change and grow around the software without you having to constantly make changes. Other managers will say, "But, security! I don't want my people changing that!" ... it's much easier to log everything by user and have a manager discipline someone later if they change a priority value on a trouble ticket than it is to lock it down and realize that you need to open it up again later on. You then get into endless revision cycles.

(I have a brilliant case study on this, email me at karl AT_NOSPAM katzke D.T net if you want more info.)

Your job as far as end-user software is to give people power, not restrict it from them. Giving people power will help your whole organization grow. Taking administrative tasks off of people's desks can have dramatic results. After going 'paperless', one of my clients grew from $200,000 per year to $3 million per year. Your organization can do the same thing.

That's the software side. To make your life easier on the hardware side, try to stay on one platform. Standardization will make your life a lot easier and will improve the bottom line for the company over the next five years.

For instance, consider replacing every desktop in the building with the same machine. Buy about ten extra ones. Develop a standardized ghost image (and possibly a few special variants for people with different software needs) and re-ghost all of the computers periodically. That way, when one breaks, you simply swap out another one from your cache, and the person's up and running again immediately. You can repair the old one at your leisure or part it out.

Your ROI on this is the time that would've been lost getting the person another computer and the time they're down. ... this can be $500+ for each instance of downtime if the person is down for the four hours it would take your desktop person to get components put together for a new box, plus the four hours that desktop person's not doing anything but building and installing software on that new box, plus the lost opportunity costs associated with that first person not working for four hours.

The same goes for servers. You always want to have a general backup ready to go. If a server completely goes kaput, the company whom I copied the desktop standardization from can either replace a part or have a new server (pre-loaded OS) up and running from the backup stored on their RAID array within hours.
Just remember that people aren't replaceable. Cull poisonous employees from your IT staff, or find a way to isolate them to a solo, tedious project that needs to be done. Building a good team is half of the battle of retaining people when the going gets tough, and it will from time to time.

On the server side, I highly reccomend linux. Highly. Can't say it enough. Would you like to measure your server uptime in years? I do. Linux sysadmins ... GOOD linux sysadmins ... are not that expensive. Security completely aside, Linux is simply more stable as a server OS than Windows is, even though Windows products have come a long way. With package-managed production-stable systems like RedHat Enterprise Linux and Debian, you don't have to work that hard to administer things... and it's rare that you'll have to reboot. ;)

Last word... I realize this is long, but like I said, near and dear to my heart: Manage change. Ok, that sounds like something I stole from Fast Company, right? Well, no, they stole it from me... ;) ... You want to keep track of changes that are happening in your environment and you want to manage them so that there's no nasty configuration surprises later on. For instance, at a previous employer we had a "Server Bible" that was kept in a locked but accessible location (i.e. "In case of emergency break glass" type of deal in the highest-security part of our server room) that had everything in it from root passwords to custom server configurations, and it was updated religiously. If a server went down at midnight and I, as the webmaster at that particular company, was the only one able to respond, I would know that I could find anything I needed to rebuild a server or restart a process in that bible. That's only an example of the type of docs you should be keeping and should force your techs to keep updated.

Gee. I could go on all day. Email address is above, let me know if you need any other help.
posted by SpecialK at 10:07 AM on December 20, 2004

The best investment you can make is a little time to see how people do their jobs. The amount of times I've sat in a department speaking to someone about their job and my jaw has hit the floor when I've found out the dumb way they use their computers or seen the stupid waste of time and money. Find out how people do their jobs and the answers will come to you all too quickly - and often they may only require small investments in training or basic software.

In my job my latest bugbear is that I walk around the offices and everywhere I go there are people wasting time standing around fax machines - it annoys the crap out of me.
posted by dodgygeezer at 11:32 AM on December 20, 2004

Dodgy: We solved that at my last job by having our fax lines run in through our T-1, and they connect to a special fax modem card on a server. The server makes PDFs of the faxes, and they're attached to an email, delivered to the desktops, and archived on the network share. They're delivered either by a word match if the coversheet was typed, or just to general mailboxes based on what fax number the fax came in on. The people who receive the most faxes now have their own fax numberfs. The $10k server and card combo saved us something like $20k/year in new fax machines, toner, and maintenance.
posted by SpecialK at 11:55 AM on December 20, 2004

Thanks - that's pretty much what I've been planning to do as that's what I had where I last worked (using GoldFax on Exchange) but the wheels turn slowly at this company and it takes time to convince people that they're saving rather than losing money.
posted by dodgygeezer at 12:09 PM on December 20, 2004

Yep, we had a linux-based solution, but I don't remember what the product was. I do remember that it was put in against the protests of some very high level administrative people, who looooved their old fax machines. Emailing an attachment just turns out to be so much easier... Now, if the fax thingie is down for whatever reason, they can't remember how to use the old fax machine ...

I know how the 'slow going' goes. As the lowest person on the totem pole at my old company, I'd write up a project proposal, email it to my manager and the VP if IT, and file it. Six months later, usually to the day, one of them would run into my office like the building was on fire and say, 'We gotta have something to do x!!!' ... and I'd pull out the project plan dated six months earlier and hand it to him. My manager loved it, but the VP didn't... I was laid off in the next round of layoffs...
posted by SpecialK at 1:19 PM on December 20, 2004

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