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Advanced
How To Guide
Formulating an IT/eBusiness strategy for SMEs
3.03
Information Flows
Processes that are operationally critical and also
information intensive are most likely to benefit from
computerisation. Thus as part of your strategy formulation,
examine the types of information flows in the company.
Consider how much information of each type you handle,
how time critical it is, how easy it would be to computerise,
how important accuracy is, the extents to which computerisation
could save staff time, reduce mistakes, speed up the
generation of time critical information etc. These can
vary by company.
Consider, for example, a machinery manufacturer that
produces 10 expensive machines per week. There is little
point in such a company investing significantly in a
fully computerised system for recording orders for new
machines. The machines often involve an element of customisation,
which will add to the complexity and thus cost of computerising
the order entry system. With only 10 orders a week,
the small amount of staff time saved is unlikely to
justify the high cost of a computerisation project.
However, machines are generally made from different
parts purchased from a multiplicity of suppliers and
the parts used vary by model. Often hundreds of different
parts can be involved and the parts vary by machine
model. If even one small part is missing an entire expensive
machine can't be shipped. Our machinery manufacturer
may well find that computerising stock management and
component ordering would repay the investment involved.
If done correctly, it could simultaneously reduce stock
outs and stock holding levels. It could also help management
make better decisions about what delivery dates to promise
each customer. Thus such a company should probably examine
in reasonable detail the costs and benefits of a computerised
stock management system.
Ensuring that customers receive the right spare part
is also challenging given the large number of spares
and the fact that the mix of parts used changes as product
designs evolve over time. A later project might involve
IT based systems to help dealers check which spare parts
fit which machines and, if the dealer network had the
necessary IT capabilities, facilities to allow them
order the spares online.
On the other hand, a footwear manufacturer with a similar
turnover to our equipment manufacturer faces somewhat
different issues. They are likely to be selling a thousand
times as many individual pairs of footwear as the equipment
manufacturer sells machines. They will have many models
of footwear and each will come in a range of sizes and
sometimes colours. Making sure that each of the many
shops they supply gets the model, colour and size of
shoes they want and is subsequently invoiced at the
right time for the correct amount of money, is a vital
but information intensive task. Hence, for them, unlike
the machinery manufacturer, computerising billing and
order entry (ideally by having the shops place orders
online) is an area that might well be worth examining.
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