My Library and Courses
Last Update: Monday September 20, 2021

Key Idea: Use Technology Aggressively

At his company, Ironbound Valve Actuation, Howard Kent uses technology to increase profits.

Key Question:

A: 

What comes to mind when you hear the word "technology"? For most of us, it's computers first, followed closely by the Internet. But technology's role in the small business is just as important as marketing and finance. Technology is the ultimate enabler. You can do more in your business and you can do it faster with less error if you incorporate technology in your everyday business operations.

Q: How does a small business use technology in the business?

A:
There's lots of ways and many of them were only available to big businesses up until a short time ago. But new products and plummeting costs have positioned all of us to be more competitive in our respective market places with a minimum investment. We can analyze our inventory and learn what sells and what doesn't, in what quantities, to whom, with what seasonality, at what margin, and just about anything else we might want to know. We can codify the intellectual capital of our organization, protect it, keep it organized and up-to-date, and easily search and retrieve what we need. It's all about the learning continuum, turning data into information and information into knowledge, then using that knowledge as the basis of the decisions we make in operating our businesses. Hence the term: knowledge management.

Our challenge as business owners is to figure out what data to store, in what vehicle (data warehousing) and how to access it in such a way that it provides meaningful information that is of real value to us in our business (data mining). We've used a lot of buzz words here; let's look at knowledge management, how it actually works, within a small business. There are a number of things that even the smallest business can do to capture, organize, and make available the intellectual capital of the organization.

We'll focus on three here.

Establishing a Common Operating Environment (COE) Before you had computers at your office you kept documents in folders in file cabinets. Different people had access to those documents because they needed them to do their work. Sometimes people forgot to return the documents when they were through, and you would scout around the office until you found them. Sometimes two people needed the document at the same time and they would work something out, or make another copy of the document. The point is that every business generates important information, has processes that includes forms and templates, and shares these among a number of employees.

Now that you have computers, you still generate documents, you still keep them in folders, folders are kept within folders, and various people have access to them. Electronic filing systems can be vastly superior to paper filing systems if we remember to follow the business practices we used in a paper environment. Do you have documents on your computer or network server that are not in folders? How many? How does that compare to the number of documents you would have tossed into a file cabinet without filing? The good news is that at least (a) the documents are listed alphabetically wherever they are stored and (b) we can always "search" for them if we remember the name, or the software application, or when they were last modified. Hmmm. There must be a better way. You're right! And it's called a common operating environment or COE. In a business with a network environment, where a number of employees have access to a central data depository, you:

1) Establish document naming conventions. As new documents are created, they are named in accordance with organizational policy. People looking for a document would have a good idea of the document name, even if someone else created it.

2) Determine the file structure. Folders within folders within folders. Organizing your information so that documents are easily located.

3) Grant access as appropriate. Security levels and edit rights, determining who can have access to what or not, when to permit "read-only" access, and who is authorized to make changes.

4) Safeguard information. Back-up systems, on and offsite, disaster recovery plans. If you do all of the above, provide training on the implementation, you will have established a COE. The benefits are enormous and immediate.

Use Databases to Work and Mine Data  Most of us couldn't imagine functioning without word processing software and spreadsheet software in our businesses. We all use e-mail and a lot of us can use presentation software, some more rudimentary than others. Yet, for some reason, the database software frequently goes unused in the small business. If you use Microsoft, you could pick up here.

Digitize, Digitize, Digitize Maintaining our information in electronic form is critical to both the establishment of a COE and mining our data on an ongoing basis. Virtually all software applications allow for exporting data and importing data. So as long as you maintain your data electronically, you can take advantage of new software development in your industry without having to re-enter the information. Electronic files are easier to navigate and cheaper to maintain. Additional computers and memory are just less expensive than rent, file cabinets, and storage facilities.

Think about it

How far has your business moved along the learning continuum? Are you taking advantage of the latest technologies to codify the intellectual capital of your business? If you arrived at your office, and all your information OR all your money was gone, what would be more devastating to you? Now, compare how you safeguard your money with the way you safeguard your information. As you digitize your workflow, be sure you have adequate back-up systems with offsite storage for all important information.

Clip from: Staying Power

Key Questions about business: What makes a business work?  Why do some make it while so many fail?  And, in the USA, why are there so many business start-ups every year?  How does a business make it beyond the first year? ...third year? ...and fifth year? These are benchmarks. Milestones. Most startups do not get past them.

So, when these veteran entrepreneurs answer the question, "How did you do it?," there is a lot to learn.

This television special outlines the common qualities found in companies that make profits for decades.

Go to all the key ideas and video of this episode...
Go to the homepage for this episode...

Ironbound Valve Actuation

Howard Kent, Chairman, CEO, founder

146 Jackson Street
Newark, NJ 07105
9735895209

Visit our web site: http://www.ironbound.com

Office: 9735895209

Business Classification:
Retail/Wholesale

Year Founded: 1966

Use Technology Aggressively

HATTIE: Number 6. Technology know-how. Most owners like Howard Kent, who has been running his company since the 60s work hard to apply technologies as they evolve. The goal is always to automate and streamline business processes.

HOWARD: ...we can now find out how much we have in stock instantly: How much did we sell of this item year to date? This year? Last year? Are we increasing our sales because of this? Decreasing our sales because of it? What's the cost? Keep track of it any way we want. We can tell when a customer last bought it: How much did they buy? How much did we make from them? When did they use this item? Is it as seasonal item? This has enabled us to cut our inventory by a third.

HATTIE: Today there are strong companies that only exist because of advanced technologies. eHarmony launched a web service to help the millions of singles in the world find the love of their lives. (Voiceover) This bride met this groom on eHarmony.com.

JOHN: (Voiceover) I, John, take you Cindy to be... Clergy: (Voiceover) I pronounced you husband and wife in the name of the Father and ... Photographer Taking A Group Wedding Picture: (Voiceover) Ready, one, two, three.

NEIL CLARK WARREN: If you could reduce the divorce rate from where it is now to single digits, 9 or fewer percent, it would be the greatest single social revolution in the history of the human race. And all of a sudden America would be such a different country. (Voiceover) Over 90 percent of all singles want to be married if they can find the right person. So they deeply want to get married, in fact for a lot of people it becomes a burning yearning. The choice you make of a marriage partner will have more to do with the eventual success of your marriage than everything else combined that you do after you get married.

HATTIE: (Voiceover) In 1993, Dr. Neil Clark Warren wrote the book, Finding the Love of Your Life. Then in 1995, Greg Forgatch joined him to launch their first company to offer seminars based upon the principles in the book.

NEIL, GREG, STEVE (meeting): If you compare this to what you were saying.

HATTIE: (Voiceover) In August of 2000, the two opened their second business, eHarmony.com. Today the service is being used by millions of paying customers.

HATTIE: (Voiceover) At eHarmony.com, anyone can take the free personality profile. Answer the 436 questions. And what is easy to use and seems like common sense today is the result of decades of work by Neil Clark Warren.

Not a member yet? Learn!  Be empowered! Join us!