|Adding Value with IT|
IT can change the way you do business, much in the same way that the Internet allowed Apple to invent iTunes to sell music online. But to make IT a business tool, it needs to add value. To learn how it can do so for your business, you’ll want to look at all the activities your business performs that earn profits.
Differentiate your company and increase your profits—with IT
It’s easy to think of IT as a tool that comes with a cost—but doing so is a big mistake. That’s because IT, when used properly, can be a strategic asset. It can make your information more accurate, improve your employees’ response time, and even differentiate your company in the marketplace.
To make IT a strategic asset as opposed to a tool, it needs to add value. To determine where to make improvement, you’ll want to look at your value chain, which includes all the activities your business performs, and ask which ones earn profits. For example, if you’re a manufacturer, better IT could result in more efficient supply purchasing. If you’re a retailer, better IT could result in fewer units needing after-sales service and repair. Focus on improving IT in those areas and you’ll likely improve profits.
An added benefit of this exercise: The use of IT in a new way may create even more opportunities for your company. For example, the Internet allowed Apple to invent iTunes, and now mp3 downloads have overtaken CD sales. Even small businesses can experience this. Case in point: The invention of iTunes has given many startup software companies a distribution channel for apps that otherwise may not have been invented. But the idea doesn’t have to be visionary in this way: YourLittleFilm.com, a small business that creates custom short films, used customer relationship management (CRM) software to help follow up on business leads, and got a 10 percent response rate.
How and where you add value with IT developments will depend on your business model. There is little point, for example, in automating production if your customers cherish hand-made products. However, you might find that investing in a CRM system might give you a more efficient way to track your customers’ preferences and provide them with a more personalized service.
Using your IT as a strategic asset gives you tools to manage clients worldwide, increases your visibility, and lets you compete with much larger players. Contact us to find out how you can use technology to gain an edge.
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