Technology1 Copyright 1999 Prentice Hall Publishing Company Using Technology to Gain a Competitive...

TechnologyTechnology 11Copyright 1999 Prentice Hall Publishing CompanyCopyright 1999 Prentice Hall Publishing Company

Using Technology to Gain a

Competitive Edge

Using Technology to Gain a

Competitive Edge

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Area of Company

Where Does Technology Pay Off Most?A survey of the Inc. 500 Fastest-Growing Companies


Information Technology and Information Technology and Competitive AdvantageCompetitive Advantage

Information is becoming the competitive Information is becoming the competitive edge by which growing companies win or edge by which growing companies win or lose in the marketplace. lose in the marketplace.

Technology itself is not that important to Technology itself is not that important to a company’s success, but how an a company’s success, but how an entrepreneur finds creative, innovative entrepreneur finds creative, innovative ways to use that technology to serve ways to use that technology to serve customers better is!customers better is!

Increases profitablity andsales

Enables company to usefewer employees

Adds capabilities tocompany

Helps company performfaster/more efficiently

2%

5%

6%

11%

12%

12%

45%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Percent of Companies Responding

Increases profitablity andsales

Enables company to usefewer employees

Adds capabilities tocompany

Helps company performfaster/more efficiently

Impa

ct

Technology's Impact on Small Business


Developing a Technology Developing a Technology PlanPlan

Decide what you want your company to Decide what you want your company to be able to do for itself and for your be able to do for itself and for your customers. customers.

Determine the technology and the Determine the technology and the equipment you will need to perform those equipment you will need to perform those tasks.tasks.

Conduct a technology audit.Conduct a technology audit.


Developing a Technology Developing a Technology PlanPlan

Match goals and resources.Match goals and resources. Develop a technology budget.Develop a technology budget. Make the necessary purchases.Make the necessary purchases.


How to Computerize a How to Computerize a Small BusinessSmall Business

Step 1Step 1. Develop a list of current activities.. Develop a list of current activities.

Step 2Step 2. Decide how much and which areas . Decide how much and which areas of the business to computerize.of the business to computerize.

Step 3Step 3. Develop a computer budget.. Develop a computer budget.

Step 4Step 4. Define the informational needs of the . Define the informational needs of the functions to be computerized first.functions to be computerized first.


How to Computerize a How to Computerize a Small BusinessSmall Business

Step 5Step 5. Shop for software packages that will . Shop for software packages that will perform the required functions.perform the required functions.

Step 6Step 6. Choose the hardware.. Choose the hardware.

Step 7Step 7. Integrate the system into the . Integrate the system into the business.business.


Step 1: List Current ActivitiesStep 1: List Current Activities

Which activities should you consider Which activities should you consider computerizing?computerizing? Accounting, inventory control, training, customer Accounting, inventory control, training, customer

contact, sales, presentations, training, etc. contact, sales, presentations, training, etc. Prioritize: Prioritize:

High - Those driving the decision to computerize.High - Those driving the decision to computerize. Medium - desirable but not essentialMedium - desirable but not essential Low - Nice to have but not essential.Low - Nice to have but not essential.


Step 2: Decide Which Areas to Step 2: Decide Which Areas to ComputerizeComputerize

Do Do notnot choose a “problem area,” expecting the choose a “problem area,” expecting the computer to fix it.computer to fix it.

Start with a smooth, well-functioning system.Start with a smooth, well-functioning system. Review Step 1:Review Step 1:

Which activities are critical to success now? In the Which activities are critical to success now? In the future as the company grows?future as the company grows?

Which will be critical to maintaining our Which will be critical to maintaining our competitive advantage?competitive advantage?

Which will improve our customer service?Which will improve our customer service?


Step 3: Develop a Computer Step 3: Develop a Computer BudgetBudget

Budget must reflect not only the cost of the Budget must reflect not only the cost of the hardware and software but also the cost of hardware and software but also the cost of training, support, and maintenance.training, support, and maintenance.

Consider the Total Cost of Ownership (TCO).Consider the Total Cost of Ownership (TCO). Study: In small companies, TCO of a $5,000 Study: In small companies, TCO of a $5,000

personal computer is actually between $15,000 personal computer is actually between $15,000 and $20,000 per year!and $20,000 per year!


Step 4: Define the Informational Step 4: Define the Informational Needs of Each FunctionNeeds of Each Function

How does information flow through each How does information flow through each function to be computerized? Which function to be computerized? Which employees receive and generate information?employees receive and generate information?

Does the company need a network so that Does the company need a network so that employees can share information easily?employees can share information easily? Local Area Network (LAN)Local Area Network (LAN) Peer-to-peer LANPeer-to-peer LAN Client/Server LANClient/Server LAN


Step 5: Shop for Software to Step 5: Shop for Software to Perform the Required FunctionsPerform the Required Functions

A computer without the proper software is A computer without the proper software is like a car without an engine - useless!like a car without an engine - useless!

Shop for the right software package Shop for the right software package beforebefore purchasing any hardware.purchasing any hardware.

Software requirements determine hardware Software requirements determine hardware purchases. purchases.


Step 6: Choose the HardwareStep 6: Choose the Hardware

Once you select the right software, then you Once you select the right software, then you should focus on finding the right hardware to should focus on finding the right hardware to run it smoothly.run it smoothly.

Although price is an important issue, it Although price is an important issue, it should not be the driving factor.should not be the driving factor.

Other considerations include: processing Other considerations include: processing power, expandability, compatibility, and power, expandability, compatibility, and serviceability.serviceability.


Step 7: Integrate the System Step 7: Integrate the System into the Businessinto the Business

Converting from a manual system to a Converting from a manual system to a computerized takes time, hard work, computerized takes time, hard work, and patience.and patience.

Don’t forget training! Untrained Don’t forget training! Untrained workers will not be able to get the workers will not be able to get the most of a company’s computer most of a company’s computer investment.investment.

Gradual phase-ins usually are more Gradual phase-ins usually are more successful than overnight transitions. successful than overnight transitions.


Software ApplicationsSoftware Applications

Word processingWord processing AccountingAccounting Database managementDatabase management SpreadsheetsSpreadsheets Presentation graphicsPresentation graphics CommunicationsCommunications



World Wide Web browsersWorld Wide Web browsers World Wide Web page designWorld Wide Web page design


Who's Onlineby Generation

32%

27%29%

12%

0%

5%

10%

15%

20%

25%

30%

35%

GenerationY (born

after 1976)

GenerationX (born

1965-1976)

BabyBoomers

(born1946-1964)

Matures(bornbefore1945)Generation

Per

cent



Project managementProject management Software suitesSoftware suites Industry-specific softwareIndustry-specific software

World Wide Web browsersWorld Wide Web browsers World Wide Web page designWorld Wide Web page design


The Dark Side of ComputersThe Dark Side of Computers

Electronic disastersElectronic disasters Computer crimeComputer crime VirusesViruses


Ensuring Computer SecurityEnsuring Computer Security

Determine which data needs to be Determine which data needs to be protected.protected.

Decide how to secure the data.Decide how to secure the data. Recognize that the weak link in the Recognize that the weak link in the

chain of computer security is chain of computer security is peoplepeople.. Encourage employees to maintain Encourage employees to maintain

security standards on a daily basis.security standards on a daily basis.


Other Technology ChoicesOther Technology Choices

PrintersPrinters InjetInjet Monochrome laserMonochrome laser Color laserColor laser

Digital camerasDigital cameras Personal digital assistants (PDAs) and Personal digital assistants (PDAs) and

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