Working Wonders on the Web
The Internet isn't just for decorative marketing sites these days. Companies on the leading edge are harnessing the Web to run some of their most strategic operations, and they're reaping big rewards as a result.
Published November 2003
EMAIL THIS ARTICLE
PRINTER FRIENDLY
COMMENT ON THIS ARTICLEPeter Monticup sits at his desk, a miniature guillotine at his elbow, a 70-year-old "talking" skull staring vacantly from its perch beside a Dell computer. It is not yet 9 a.m. and already he has fielded a dozen phone and e-mail inquiries from, among others, a man requesting a recipe for stage blood and another novice having difficulty with the Faro shuffle. Now Monticup is typing a response to someone who's staging a play and needs to know how to produce a cigarette as if from nowhere.
"Either use an illuminated self-smoking cigarette prop along with an automatic finger-mounted cigarette producing gimmick or have the actor produce a bouquet of flowers instead," Monticup types. "And if you use the cigarette, don't inhale!"
Monticup, founder and president of MagicTricks.com, a Web-based business in Charlottesville, Va., spends about 40% of his time typing explanations of such arcana. Answering questions was easier when he owned traditional stores and could simply show people he had nothing up his sleeve. The difficulty involved in demonstrating tricks online means customer service is more important to his business than ever; it just requires speed of typing rather than sleight of hand. And that's but one small change. Like most company owners who've made the Web a critical piece of their operations, Monticup has experienced new demands on himself, his staff, his processes, and his budget.
Five years ago small businesses got props if they remembered to change the date on their home page. Today some consider their Web operations as important as their supply-chain or customer-service functions. In fact, their Web operations may be those functions. This is true not only of companies that sell online but also of those that manage large projects with many partners, such as construction firms, or are in industries that require multiple handoffs or sign-offs, like freight or advertising.
Such strategic use of the Web is still uncommon. Of companies with fewer than 100 employees, only 40% have websites, and just 40% of those do e-commerce, according to Merle Sandler, a senior analyst at IDC, in Framingham, Mass. Far fewer manage other major functions online. "They still see it as being too expensive," says Sandler.
Whether to spend on talent or tools is just one decision facing company owners.
But companies that bet on the Web say their investment has paid off in new business, streamlined processes, and improved relationships with customers and suppliers. And while the investment may be large, there are ways to cut corners, such as using software and services priced for small companies and automating processes in stages. "We know we're not General Motors," says William Jopling, whose $15 million company, Wood Flooring International, is lashing together its entire supply chain using FrontPage and $4,000 software that makes reports interactive. "For a company our size, the key theme is doing it on the cheap."
Jopling does, however, turn out his pockets for four IT staffers. Whether to spend on talent or tools is just one decision facing company owners with Web initiatives. Others include whether to make the project interdepartmental, how to get customer buy-in, and what the goals are. For mission-critical Web operations, simply racking up hits doesn't cut it.
In this article, we look at how three very different companies are using the Web to handle three of the most vital business functions--supply-chain management, customer communication, and, of course, sales. Their experiences provide a good idea of the care and feeding required by Web efforts that have ceased to be mere decoration and have become, instead, load-bearing walls.
The Company
Wood Flooring International
$15 million in revenue; 30 employees
The Site: An elaborate extranet that manages every link of the supply chain, from vendors all the way through to its customers' customers
The Cost: More than $300,000 so far to build; about $240,000 a year to operate (almost all of that labor)
The Team: Four technologists are dedicated to the site, and the CEO spends about a third of his time working on it as well.
If you run a mill in Paraguay, Malaysia, or Italy that sells to Wood Flooring International (WFI), chances are you've recently received a visit from Andrew Mullen. Mullen is in charge of technical services and quality control for the Delran, N.J., company, which buys exotic wood overseas, has it milled into floorboards, and sells it to distributors. Unlike most techies, who toil in the bowels of corporate data centers, Mullen spends a third of his time jetting around the world, preparing WFI's vendors to use its online supply-chain-management system. It isn't always easy.
