There’s a disease out there in the small business sector. And it’s costing billions of dollars in lost productivity.
That disease is the practice of manually handling and/or duplicating customer and related data.
It occurs when information flow is poorly designed so that a piece of information, in order of offensiveness, is either:
It also occurs when data processing procedures are not brought up to speed with recent methods of entering, storing and transferring data.
Now I’ll be the first to say that I’m no expert in data processing procedures; but what I do know is that the productivity lost to small business due to the problem is a major impediment to profitability and growth when it is needed most.
This is what’s happening in a business near you, and possibly nearer than you might like to imagine. Customer or stakeholder information is being re-created into so many disparate systems that it could take anywhere from three to eight times longer to process than if it had been first entered into your business.
All when a fundamental understanding of systems and a re-design of your data processes could reduce the malaise to an absolute minimum.
Let’s look at a handwritten invoice. This alone represents multiple productivity violations.
First, it takes several times longer to handwrite a document than have a fast typist key it in.
Second, you are double handling two separate but related sets of information – the information about the customer and the financial information.
Let’s face it; sooner or later the same information (providing you are a law abiding and tax paying business) will need to hit a financial system – the vast bulk of which are designed to provide invoices anyway.
So both the customer information and the transaction information will need to be keyed from the handwritten invoice into the financial system.
Chances are this same invoice was preceded by the provision of an estimate, representing yet another layer of customer and financial information – both of which are duplicated (providing the work goes as planned) to a later invoice.
But it doesn’t stop there.
Usually the customer is entered into a customer database that is usually separate and ‘unintegrated’ with the financial system. Often this database is not capable of email broadcasts, which you may want to use to promote or into a job or project management system, both of which will require, you guessed it, two more layers of data duplication.
And on it goes…
All when a well designed information flow will minimise any manual handling or duplication whatsoever.
The following diagram outlines a “holy grail” of information processing. The systems illustrated are reasonably typical of most organisations, though some will require many, many more.
At its hub is the depository of customer information – the database or Customer Relationship Management system.
Ideally all of the organisation’s data systems will source this central depository for information about the customer and, better still, record the transaction against this central customer record.
So if an email is sent to them, it’s appended to the customer record. If they are invoiced, it’s appended to the customer record, and so on.
Large businesses understand the cost of manual handling and duplication, so spend significant sums on establishing and maintaining systems to prevent it.
The great news for small business operators is that like all technology, systems like these decrease in price over time. Investment in the right technology, together with a concerted effort to eradicate time wastage, can drastically streamline your data processes.
It’s well worth the time and effort invested in getting it right.
In addition to being a leading eBusiness educator to the smaller business sector, Craig Reardon is the founder and director of independent web services firm The E Team which was established to address the special website and web marketing needs of SMEs in Melbourne and beyond. www.theeteam.com.au
