Having spent the last 17 years in woodworking technology, I’ve seen all kinds of effects it has had on businesses. Wouldn’t it be nice if it were as simple as buying more technology to cure the struggle to make more profit. Well, it’s not.
The truth is, if you know how to run a business and make money, technology will accelerate that and boost your profits. The down side is that if you constantly struggle with turning a profit, adding technology might just accelerate the inevitable.
Scary? It can be.
If you’re just getting into business, technology won’t be the make or break it factor of your success. You’ll either succeed or fail. Technology will likely accelerate that either way. The reality is that most shops have been around for a while. If you’ve been capable of staying afloat through thick and thin, you’ll likely benefit from adding technology to your business. If you’ve been able to turn a profit, updating your manufacturing process will help you weather turmoil in the economy and market better. It will increase your ability to squeeze out profit and increase the amount of it you are left with.
Making money is a mindset and a skill. Technology is a fantastic enabler. For example, if you have scheduling problems, simply adding scheduling software will not make the problem go away. Many times, adding technology to a problem area does fix it, but the reason it get’s fixed is that the company focuses on setting up the new technology and this requires really thinking about how to best handle scheduling. So it’s not really the technology solving the problem, but more so the focus on the problem. In addition, if you have a good vendor with experience, the vendor can be part of solving the problem based on their experience in other shops.
The one thing technology does do well is record and automate the system that has been designed. In the example of scheduling, you can solve the scheduling issues with a human, but then the solution resides mostly in the persons’ brain. Spending the time to input the desired scheduling processes into software allows you to take the knowledge from multiple human sources and record it in software that will be there regardless of who the scheduling person is. This gives greater security for the company that doesn’t need to rely on a certain person to do a certain job. That person leaves or moves to a different position, a new person needs to be trained with a wealth of knowledge. Removing the shackles from that role allows that person to be promoted or moved to a different area of the business.
So in a sense, technology does put the odds in your favor when trying to fix problem areas. Even though it’s not the technology that is fixing the problem, it concentrates the focus of the bright people on your team to fine-tune the bottlenecks and makes sure you have it setup so that others can easily perform those tasks as anticipated.
As you can guess, people that make poor business decisions can realistically create poor repeatable processes that continue to hurt the business. If you estimate poorly by hand, there’s nothing stopping you from automating the poor estimating practices with technology. Thinking positively, when you have good people with strengths in your business, software allows you to capture that knowledge and enable those bright people to buy into something that they are a part of. These days, it’s not expected to have a single career or even a few. It’s quite common for people to move around over the course of their professional lives. So if you have the right people onboard for a certain time, capture all you can from them while you have the chance. It will give meaning to their jobs, keep them with you longer and in the end if you do part ways, their impact on your business is not lost.