Introduction to Information Technology for Small Business

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Introduction to Information Technology forSmall
Business

• Marc Compeau and Mike Wasserman
• Wednesday, 7/21/04

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Welcome!Tonights Agenda

1. What is the web? Defining technology, defining
   information technology, defining the internet
   (600-610)
2. How can information technology help your
   business? (610-620)
3. What other technologies should we be thinking
   about? (620-630)
4. Break (630-640)
5. Implementing technology on a shoestring - asking
   the right questions (640-650)
6. IT as strategic investment (650-700)
7. Wrap-up and Program Evaluation (700-730)

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Two questions for you

• 1. Do you use technology in your business?
• 2a. If so
• What technologies do you use?
• How do these technologies translate into VALUE
  for customers, employees, suppliers, owners?
• 2b. If not
• Why not?
• What factors, if any, have influenced your
  decisions not to use technology as part of your
  business?

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A basic definition of technology

• Technology is any process that any company uses
  to convert inputs of labor, materials, capital,
  and information into outputs of greater value.
  (Christensen Raynor, The Innovators Solution,
  2004)
• Lets look at a specific type of technology
  Information technology

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What is Information Technology?

• Information Technology is hardware (computers,
  wires, printers, etc) and software (programs that
  run on and across hardware) that helps
• collect, store, analyze, and interpret data
• Help share that data.
• Convert data to information to knowledge.
• Data individual pieces of information (not
  necessary useful, timely, or relevant)
• Information multiple pieces of data organized
  in a way that makes the data useful (comparison
  over time or across cases)
• Knowledge multiple sets of information that are
  used to solve problems or make decisions

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How can information technology help your business?

• Building Revenues
• Better customer service (Customer data, tailored
  selection, responsiveness to questions)
• Access to different customers (not bound by
  geography, hours, parking, weather, etc.)
• Multiple ways for existing customers to access
  your products and services (in-person, phone,
  online)
• Examples Web eBay, Amazon, independent small
  business web sites (Penzeys, Zingermans, Whole
  Latte Love)

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How can information technology help your business?

• Managing/Controlling Expenses
• Controlling costs (expense mgmt, inventory mgmt,
  purchasing, CASH FLOW!)
• Improved quality (reduced errors)
• Better measurement and strategic decision making
  (faster access, pattern recognition)
• More accessible learning (employee training)
• Examples Software (e.g. Quickbooks) and online
  resources (e.g. Skillsoft)

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Information TechnologyWhat are the costs?

• Initial Hardware, Software, and Training Expenses
• Ongoing Support Expenses
• Setup
• Maintenance/Upgrades
• User Training
• Two critical issues with long-run cost potential
• Privacy
• Security

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Software Decisions

• Software
• Operating System
• Windows, Mac, Linux
• Applications
• Accounting QuickBooks, Excel
• Database As simple as Microsoft Excel, or
  Microsoft Access, or MySQL (Linux)
• Desktop publishing
• Webpage creation

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Other technologies

• What other technologies should we be thinking
  about?
• Can you think of any technologies that would help
  you sell or distribute your product? Build your
  customer base? Manage your expenses? Help your
  employees do a great job?

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Implementing technology on a shoestring

• Dont do it yourself unless you are good at it!
  (Outsourcing core competencies)
• Asking the right questions. Learn enough to
  understand rough costs, key stumbling blocks,
  make sure you know exactly WHAT you want the
  technology to do and be able to measure it!
  (Networking with other business owners is key)
• Get multiple opinions - there is no one right
  solution - only tradeoffs.
• Dont rush - be strategic! Think about it, learn
  about it, then make a decision with a long-term
  implementation plan.

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IT as strategic investment

• Should you invest money now in IT in order to
  improve the long run performance of your firm?
• Total cost of ownership
• purchase plus maintenance, training, and upgrades
• 2. Tradeoffs of tying up valuable capital for
  long-run IT investments
• Options lease vs. buy, Linux vs. Microsoft
• 3. Look at cash flow impact cost reduction,
  revenue enhancement

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Sources for More Information

• Free web-based sources
• Infoworld http//www.infoworld.com/
• Context http//www.contextmag.com
• Darwin http//www.darwin.com
• An article or two
• Intel. Business Week. 3/8/04 http//www.businessw
  eek.com/magazine/content/04_10/b3873001_mz001.htm
• The Future of Technology. Business Week. 8/23/30
  http//www.businessweek.com/magazine/toc/03_34/B38
  460333futuretech.htm

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Wrap-up

• Todays Key Points
• 1.
• 2.
• 3.
• 4.
• 5.