Business owners and computer-industry experts tell readers what technology they plan to buy, and why.
Pet suppliers, fashion designers, even happy homemakers are buying into the technology boom. Can the return be measured in dollars and cents?
Just the thought of buying new information technology (IT) can be terrifying. Will it be outdated before you plug it in? Will it cost too much or not be powerful enough? Will it take too long to get up and running? And -- perhaps the most difficult question of all -- will it be worth the trouble and expense?
According to the U.S. Bureau of Economic Analysis, in 1993 U.S. businesses spent $115.1 billion on hardware alone. Add in software, networks, and consultants -- not to mention maintenance and upgrades -- and the figure quickly increases. The return, on the other hand, may be simply that a company is more productive with fewer people. Or it may be as intangible as access to new clients and markets or enhanced marketability of products or services.
We asked business owners, computer-industry experts, and even a well-known homemaker to tell us about the most exciting new technology they plan to buy and what they expect the payoff to be. The plans ran the gamut, from accounting systems to multimedia employee-training software to a satellite hookup. As for the justification for their investment, that had less to do with formulas than with plain old common sense.
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James Carpenter
CEO of Wild Birds Unlimited, a 180-store franchise headquartered in Indianapolis, Ind., specializing in bird-feeding supplies
We want to have systemwide E-mail, so we can pull the accounting and point-of-sales information from all our stores, which are spread through 39 states. We want to be able to bring that information to headquarters, where we'll collate and number-crunch it to see more closely what's happening out there. We want to have better communication from store to store and from headquarters to stores. We also want to be able to take advantages of opportunities. For instance, we stock a brand of imported birdseed. If the boat carrying it catches fire in a harbor somewhere, the entire supply of that seed for the next two months is lost. With systemwide E-mail we could tell our stores that the price of that seed is going up and that they should buy it now, even if their inventory isn't low. For fun, we could even use E-mail to help us be better naturalists, by electronically tracking a bird's migration.
If I don't automate, somebody I don't even know today who does will be a competitor of mine two, three, or four years down the road. And he or she will have a huge jump-start on me because I sat on my butt. Even if it doesn't gain you a dollar today or even if it costs you, I think it's absolutely necessary that you do it. You will make mistakes and waste money, but if you don't automate now, you will be doing it in three years -- if you haven't already been kicked out of the marketplace by somebody who did it earlier.
The retail-department-store standard for IT expenditures as a percentage of sales ranges from .56% to 1.6%. I'd like to use that as a benchmark for us over a three- to five-year period. I don't want our costs to be more than anyone else's. Initially, it will feel as if we're spending a lot more. Right now, I think 1% sounds low -- I see us more at 2%. So I'd like to figure out a way to get our expenditures to 1%.
I also hope I get at least a 5% savings in labor, cost of goods sold, and advertising. I might even save on occupancy costs because I'll be turning over inventory faster and therefore will need less space for storage.
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Russ Teubner
CEO of $5-million Teubner & Associates, a software-development company in Stillwater, Okla.
We are a very small company, but we have products that cater to large companies. It's crucial that we stay in touch with our customers, our marketplace, and what's happening in the world. I've been trying to figure out how we can stay better connected. The answer is not necessarily getting another trade journal, reading another magazine, or subscribing to a newsletter. We all perpetually have a three-foot stack of unread stuff in our corner.
We are getting ready to implement a new service that is being offered by only a handful of companies: a direct satellite connection from various trade publications and news magazines. Using a satellite mounted on the building, we will gather information, then download it to a central computer system on our premises. That computer system will sort the information and distribute it to the appropriate people.
Employees who have access to the service will enter search profiles into the central computer to tell it what they're looking for. For example, if I'm interested in tracking issues x, y, and z, I would have key words identifying those issues stored in my search profile. Whenever information about those issues comes across the wires, the computer will wrap it up in the form of a personal-mail message and shoot it over to me on my desktop system.
With a data broker like the one we're using, the sources of information determine the cost. So the costs might be very low, like $50 a month. At the other end, they might be as high as $500 a month, depending on the services we want and the number of users we'll be supporting.
Payoff is really an intuitive thing. I know there is a payoff, but to calculate it I would have to figure out how much time I spend looking for relevant information without this system versus how much I spend with it.
