Technology is inexorably tied to business. Throughout history, technological innovation has allowed businesses to create better products, provide better services, and in turn, dominate their respective markets.
For example, ancient Egyptian weavers used looms to create fabrics in less amount of time than it took them to weave by hand. Centuries later, weavers in Europe, Asia, and Africa used vertical looms to produce textiles faster than ever before, leading to a boom in trade and the formation of the Silk Road.
During the industrial revolution, British factories used power-looms to automate the textile weaving process. From then on, fabric production went from being a trade to a full-blown industry. Samuel Slater, who is known as “The Father of the American Industrial Revolution”, brought power-looms from England to the United States and was responsible for conceiving the first American Factory Systems. These factories would go on to drive major economic growth in America, changing the landscape of business and serving as an example of a timeless principle of business technology:
The technology that gets the job done faster and more efficiently will establish a position at the top of the market.
Custom Software: The New Frontier of Technological Innovation in Business
Businesses today deal with technology far more advanced than looms (or even power-looms for that matter). Computers, software, and information systems of all kinds have supplanted mechanical innovation. It’s not only about who has the best means of production; it’s also about who has the most control over the data their business generates. Even in the textile space, companies that invest in eCommerce, supply-chain management, and other digital, data-driven technologies are outpacing the competition.
When compared to traditional mechanical innovation, modern technological innovation has evolved at an exponential rate. It took thousands of years for looms to become automated, whereas it only took three decades for computers to go from being used in business as basic word processors to inter-connected information systems. As a result, the gap in productivity between the top 5% of businesses in any industry and the other 95% is wider than ever before. Companies like Amazon and Google that invested in their own information technology systems early-on now dominate the market while many small-to-medium-sized businesses either get eaten up or are struggling to adapt.
Business owners and decision-makers know they need to invest in information technology, but don’t know how, or where to start. Because software directly relates to business operations, we advise many businesses to start there.
How to Invest in Custom Software for Your Business
New software usually drives larger margins than hiring employees or investing in new machines because it’s essentially just code. With a new employee, you have to pay them X amount of dollars as long as they work for the company. Even with a machine, you have to pay more than you would for new software because it takes up space and needs to be maintained. This isn’t to say software doesn’t need maintenance, but the cost of software maintenance is less because it doesn’t have to be replaced as often, and it can be hosted in the cloud or on the web.
But having software alone is not enough. In order to drive larger margins with your new software, you have to think carefully about what the software will accomplish and how you plan to keep innovating in the future.
When you look at the business landscape and see that your competitors have their own app, web-tool, supply-chain solution, etc., it’s easy to get overwhelmed and throw all of your money into a platform that does all that and more. The problem with trying to accomplish too much at once is that you don’t give yourself the time to see what works and what doesn’t. Yes, the world’s largest businesses have an inter-connected platform, but it took time and many small steps and iterations to get there.
Instead of biting off more information than your business can chew, think carefully about which of your business operations work and which ones don’t work. Don’t compare yourself to the top 5% just yet. Listen to your employees and figure out what your pain points are. Do you have trouble understanding your customers? Are there excessive hiccups in the bidding process? Are there processes that interrupt the daily flow of work? Can those processes be automated?
Even if there are multiple pain points, try to determine the one that is most important to solve first. Fixing that one process will give you a better idea of how to fix another process soon after. It’s okay to plan ahead, but when it comes to each individual business problem, it’s best to solve one at a time and allow convergence in solutions to occur naturally. After all, that’s how the biggest companies got where they are today.
Keep Testing and Adapting
Software is not a one-and-done solution. Typically, if your new software was developed with care, you will see improvements in the way your business functions that result in savings. However, remember that technology evolves faster now than ever before. It’s best to view every new technological investment as a research experiment to learn from. Now that one process is automated, or one pain-point has been resolved, how can you keep building on top of this new innovation?
If you’re careful in planning your first new piece of custom software, chances are your margins will grow. It’s worth considering how to reinvest those gains back into your company. More software might be a good choice if there are other processes that could be automated or pain-points that could be further resolved with a well-developed application.
Be observant and patient. As you become more comfortable with investing in software and information technology, you can begin to connect the dots and finally see how each solution can converge so that you can compete with the biggest names—or completely change your industry all-together.
Find a Software Development Team Who Will be Your Partner for the Long-haul
To plan and implement software that works, you need a team that not only understands software and IT systems, but also understands your business. While it’s tempting to save money and seek out a low-priced software developer overseas, your project will have a higher chance of success if you can communicate directly with your developers. Face-to-face planning is one of the best ways to ensure that your developers truly understand your processes and strategy. As your relationship with your developers grows, they can begin to function as an internal team, helping you strategize the way your business innovates with technology well into the future.
At Dovetail, we see ourselves as a technology partner. We work directly with businesses to develop and build custom software solutions that solve problems, automate processes, and give decision-makers more control over data. Over time, we help the businesses we work with identify new ways to leverage technological innovation in order to grow their business. Contact us to learn if we’re a good fit to help your business meet the demands of today, and influence the demands of tomorrow.