MISSION VIEJO, CA — Technology is breaking down the barriers that once hindered our ability to process and share information efficiently. As our industry taps into the power of new technologies, those businesses that adopt and embrace them sooner rather than later will realize new efficiencies and bottom-line improvements while simultaneously setting the revised standards of successful business operation. Those standards will be the benchmarks of competitive advantage that will steer the future of the industry.
As business owners and managers, the criteria you use for selecting a computerized business management system will have a direct impact on the results achieved.
In last week’s poll we provided the following seven choices that could influence your decision, as well as the opportunity to include your own. The choices were:
1. other industry users currently using the system
2. industry leaders currently using the system
3. name and reputation of vendor
4. vendor which specializes in your vertical market
5. ability to customize system to your own needs
6. service/support reputation
7. amount of capital investment
The results were very interesting and demonstrate that the selections were made with care. While 37 percent of our respondents chose all 7 reasons, among all respondents the factor receiving the majority of votes was number 5, the ability to customize the system to your own needs. Strong functionality and flexibility and the ability to interface with other suppliers and vendors were mentioned as well. Choices 1 and 2, regarding the use of the system by other companies, were selected the least. That tells us something very important – our readers are experienced enough in the use of computerized business management systems to recognize the significance of having a system flexible enough to meet their own specific needs.
As change in the highly competitive aftermarket continues to accelerate, economic Darwinism — the evolution and survival of the fittest — becomes ever more relevant. In the past, strength alone may have been the primary determinant for success. Today, the degree of adaptability to take advantage of emergent opportunities while combating competitive threats governs success…or dictates failure. As the market has evolved, so has technology. Some of the companies that supply solutions to the aftermarket have leveraged new technology to create the power and flexibility required by aftermarket distribution businesses as they adapt to their ever-changing environment.
Visionary e-commerce systems providers specializing in the needs of the aftermarket have recreated themselves to meet the challenges of doing business today. The transformation has completely changed the interaction process between technology suppliers and their clients. Whereas they may have previously sat across the desk from you as just another one of your vendors, they are now prepared to sit side-by-side with you on your side of the desk as stakeholders in the success of your operations. Similar to such trusted advisors as your CPA or attorney, they recognize that to be successful their customers must be successful not only today but well into the future, and that these results can only be obtained by a long-term partnership. They are prepared to partner with your business to initiate, facilitate, expedite, and help manage the processes that technology so beautifully enhance.
Toss aside the outdated perceptions that you have to live with the limitations of your former generation system or an unresponsive supplier. Systems are available now that provide solid ways to support competitive advantage in today’s market. The first question that should be asked when choosing a computer system is, “What will it do to improve my competitiveness?” Look for and recognize what savvy business owners have discovered — there are now new generation systems providers out there empowering the distributor to lower costs, improve customer service, and most importantly, to intimately connect with customers and trading partners. The second question is the next logical extension of the first: “How will the software that I buy today evolve and change to help me remain competitive and attain advantage as the market and my business evolves?
Selecting a systems provider first, one that demonstrates a solid track record in parts and service technological expertise, as well as the particular software applications and functionality needed by your business, is key if you want to develop a partnership rather than just hire yet another vendor. Here are some thoughts on choosing that partner:
1) Remember that your goal is to initiate and sustain a long-term business partnership with a company that has the attitude and technology conducive to facilitating and adapting to change within your business. A consultative approach to understanding your unique business challenges and opportunities is a good indication that a supplier is interested in a long-term partnership.
2) Look beyond the “features and functions” per dollar matrix comparison. If your business must adapt in a changing environment, then so must your software. As the respondents to our poll realize, flexibility is the key ingredient. Focus on technology that has built-in functionality with features that can be switched on and off as your needs dictate. Beyond the “canned” package with switchable features, ascertain what can be done to the software to meet specific requirements now and in the future. Can the software be modified and extended by your vendor for your specific requirements or must you choose between buying source code and hiring a programmer or abandoning a business opportunity because your software cannot support your needs and vision? When modified, can the software be maintained as part of the standard support package?
3) Know what tools your supplier has to work with and what tools it can supply for you “to do your own thing.” No company, despite culture, partnership attitude or current product functionality can deliver software that changes and adapts with your business unless its people have the proper tools. Software doesn’t wear out but it does age. Just like some people, old software becomes inflexible, creaky and cranky. Only software built with modern tools offers the flexibility to change with the market and your unique requirements.
Invest some time in understanding the technology underlying modern software. Learn what relational database technology is and what it can do for your business. Understand that object technology makes it possible to adapt software over time while not impacting support. Don’t be fooled by buzzwords. For example, know that the term “open systems” does not refer to the favorite flavor of the year in operating systems, but rather the ability of your business to interface to your trading partners, adding complementary best of breed hardware and software not necessarily supplied by your primary technology supplier.
4) Be keenly aware that a true calculation of cost versus benefit should extend to, at a minimum, five years. The missed opportunity cost of being unable to respond to change is higher than the cost of any computer system. Investing in software that your supplier does not continue to enhance is a costly mistake.
The real test of value is how the system will provide a competitive advantage not only today but as your business grows and changes over the next five to ten years. One good approach that will help you get beyond a buzzwords shootout and feature matrix comparison is to ask your potential supplier to show you what has been added or changed to the software over the past few years. A new generation solution is far more easily enhanced, so evaluating features added over the last year or so is a measure of how effective the underlying technology is, as well as how committed the supplier is to improving the clients’ competitive advantage.
The choice of a computer system is a strategic decision and the price paid today is only a small part of the total cost/benefit equation. Taking the time to make a fully informed decision now will determine whether your business will adapt to grow and prosper with inevitable change, or whether it will be subject to extinction. Only with technology can the independent distributor level the playing field with the emerging giants that invest heavily in their own proprietary technology.
We’d love to hear your thoughts on the topics we post, suggestions for additional questions and anything you’d like to share. Send us an email at: [email protected] .
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“DST Asks” is written and sponsored by DST Inc. The opinions expressed in “DST Asks” articles appearing on aftermarketNews.com do not necessarily reflect the opinions of AMN or Babcox Publications.
