Technology for the best

BY STEVE EPNER

Software specialist

The Top 100. It is quite a list. The best of the best. What makes these companies so different? Management, marketing, operations and many other things.

While I have not had the opportunity to interview or survey the entire Wholesaling 100 list from the July issue, I do know from my experience some of the things that make these companies stand out. Great business practices from some of the best can be applied to the rest. Here are some things I have learned from top companies over the years.

The best companies all have a clear vision of who they are and what they are all about. It has nothing to do with technology but everything to do with success. Everyone in the organization understands the mission and is ready and willing to support it. Just like the difference between light from a standard lamp and light from a laser, one is unfocused and goes everywhere; the other is extremely focused and can cut steel.

Make sure you can clearly state your strategy. Ask your managers and staff whether they can explain the strategy to you. If they cannot tell you what the strategy is, how can they implement it? Take the time to make sure it is clear -- to you and to everyone else. Then live by it. Use it as a filter when making decisions of what to do. An unused strategy is worse than none at all. It will give you a false sense of security.

Use technology to your advantage

From a technology standpoint, there are a number of “best practices” that I see in my travels. Over the years, I have visited hundreds of companies in many different vertical markets. The best always seem to have a few things in common.

Top companies use technology to gain a competitive advantage. These companies are willing to treat technology as a strategic resource instead of a simple shared process. It is integrated into what they do, not just added on as a necessary evil. Their IT leaders are part of the company’s long range strategic planning.

It is active in assisting the company to reach its strategic goals. If something big is going to occur, it will affect computer systems and their use. Without input from it, a great deal of effort may be wasted or unplanned activities may be required at the last minute when they are most difficult to provide. When work done under pressure -- without long-range planning -- fails, the common view about how difficult it is to deal with it is reinforced and opportunities are lost. It doesn’t have to be that way.

The top it person or CIO should be invited to provide input to the planning process. No other executive will have the perspective or knowledge of the systems and procedures, which will be affected by any given scenario. No one else will know what is necessary for the systems to support any new initiative. The top it executive can tell you what new hardware, software, support or training will be needed. He or she can estimate what it will cost and when it can be available. The answers may slow down or speed up a project, but other executives will at least know the impact and can plan for (or around) it.

Given the opportunity to be part of the strategic process, the actual implementation of the plans will be much smoother. It will be seen as a cooperating member of the team, not some pain in the back end. In addition, many companies find that their it executives have a different view of the world that, if encouraged, will help them find new ways to attack old problems. By including people who have to keep systems operational, the team gets a valuable new viewpoint while deliberating the future. All of the major studies on decision making show that a diverse team makes better decisions than one with limited outside experience.

Advancing technology is ongoing process

Another key element in the best companies is an attitude that computer system implementations are a continuing process, not a one-time project. One of the often-repeated complaints about it departments is “They never get anything done!” Well, that is true. Your business never stops changing, evolving, even morphing into something new. If the systems don’t keep up, they will not support the organization in moving forward.

There are some departments that do seem to have a problem finishing projects. Often, they are the ones that are kept out of the important discussions until the last minute. Then, they are forced to drop everything to complete an emergency project. Of course, everyone only remembers the work that was not completed and forgets about the unplanned work that got done and kept the organization operational.

I do not even encourage my clients to consider automation as an “investment.” That suggests a one-time expenditure after which one can measure the return. Computers are more like employees. They require constant care, training (updating) and even succession planning (what will be next). We can measure effectiveness and productivity. Those are more important measures of the successful it operation.

Gain greater functionality

Successful companies are always looking for more ways to use the resources they have. In a general survey, it was reported that the average distributor used less than 25% of the functions and features of their computer systems. These are capabilities that have already been paid for and are just waiting to be used. Many of these unused functions were enhancements that some other company wanted to save them processing time, increase accuracy, or solve some other business problem. Each company should be in touch with their software vendor’s support people on a regular basis and ask, “What is the next best feature we could start to use?”

The answers should lead you to a gold mine of opportunities. Not all of the functionality will fit your needs but adding a single function or feature every month will improve your operations and, if you need to use the investment allegory, increase you return on the computer systems. If at least four departments do this, you average one new feature every week. If you can get at least a 1% improvement in any operation, then at the end of 18 months, you will have doubled whatever measure you use.

If you are not sure which new features and functions to try, go to the User Meeting sponsored by all major software vendors. Talk to other executives and find out what they are using. Ask what the breakthrough items that have made a difference in their operations are.

Another way to identify new capabilities is to get your staff people involved. They know a whole lot more than most executives are willing to admit. These people keep the company operating in spite of rules, policies, and procedures that were often designed to cover up or eliminate the possibility that some long forgotten mistake might happen a second time.

There are two questions that will bring out enough ideas to keep your it people busy for a long time. Before we look at the questions, it is important to understand one other aspect of the top 100. They are not afraid of making a mistake. It is OK to be wrong as long as you learn from it, quickly recognize the problem, and correct it.

This means that it is all right for your people to question what they do. Without the ability to safely ask, progress will not occur. People who are afraid will not take a chance because they are afraid of being wrong. No one was ever rewarded for being wrong in school; they were either punished (low grades) or made to feel foolish.

The only way the following questions work is if your team feels confident that their answers will be used to help the company and not to hurt them. In some companies, it takes months (or even years) to purge old feelings. Only when people feel free to be honest will the benefits be realized.

The first question -- which can be a lot of fun in the right atmosphere -- is: “What is the dumbest thing you have to do?” If you spend much time working with line people in any organization, they always talk about the dumb things they do every day. These are all opportunities for improvement.

The second question is: “What is the most difficult thing you have to do?” What is slow, time consuming, keeps you from getting your work done? Allow your people to play with the questions and answers. You will learn where the opportunities are for improvement.

There are many possibilities waiting for you. Not all will require changing or adding automation. If you find easy fixes by eliminating an operation that no one can remember why you started to do it, go for it. Every saving in processing time is an opportunity to do something else; something more important; something that can give you competitive advantage in your markets.

Go ahead, imitate the best. You can learn what they already know: There are many ways to improve operations. Many of them are easy to do and obvious, once you open your eyes to the possibilities. Then make change part of your culture -- and watch the returns.

Steve Epner makes technology understandable for mere mortals and busy executives. He uses his knowledge of business to help clients create competitive advantage through the use of technology. Epner can be reached in St. Louis at 314/983-1214 or by e-mail at sepner@bswc.com.