Once, the only thing a business needed to worry about was how well it performed its primary purpose. Whether selling fish, carving tables or drawing up plans, the company that could provide a fresher product, greater detail or faster service would fare better than a less competent competitor.
But these days the systems behind a business matter almost as much as the end product. A carpenter with a good knowledge of search engine optimisation can sell more tables than a carpenter who makes better furniture.
A draftsman in regional Australia using online collaboration tools such as Skype, Dropbox and Google Apps can provide a better quality service, and for less, than a metropolitan rival.
A revolution in business technology, driven by cloud computing and mobile devices, is tearing up business models and with it the established ways of doing business.
But the good news is that professions and trades have the opportunity to reinvent themselves in the digital economy. A business can easily experiment with cloud computing to see whether the benefits stack up. A common first step is to replace the file server with a cloud file storage service such as Dropbox or Box.
SEQ Electrical, a Brisbane-based commercial electrical services company with 35 staff working across northern NSW, the Gold Coast and Darwin, was looking at buying a file server and building a server room.
Staff used a VPN (virtual private network connection) to access files on the server when they were in the field, however there were frequent dropouts, issues with the firewall and slow load times.
SEQ decided to go with cloud service Dropbox which gave staff access to all files from their smartphones, tablets and laptop computers anywhere in Australia (or the world).
Improved access to information helps the company work faster – internally and externally. A switchboard supplier now uploads high-resolution drawings to SEQ’s Dropbox folder rather than sending the files by courier.
And at US$99 a year for 100 gigabytes of storage, Dropbox was a fraction of the $5,000 to $8,000 quote for the server setup.
Mobile technology is a huge part of the cloud revolution, with many examples already evident. The residential tradesman’s trusty pen-and-paper invoice is being replaced by an iPhone that displays the invoice, records the customer’s signature and takes a credit card payment on the spot.
Field management cloud programs direct tradesmen to the next job, sending the customer’s contact details and job information by instant message. The head office can see where its contractors are when they clock on and clock off every day with a push of a button on their smartphones.
The revolution has hit some industries harder – and earlier – than others. Accountants are watching hours of work spent reconciling clients’ books disappear as cloud accounting programs automatically import bank transactions.
A recent speech by the CEO of the Australian Institute of Chartered Accountants gave some salient advice to accountants, but it applies more broadly to professional services.
Every business needs to ask themselves two key questions that will ensure they survive and prosper from this rebellion.
How will digital disruption affect them, and how will it affect their clients? And how can they respond to minimise threats and maximise opportunities emerging from this disruption?
One of the greatest necessities in this revolution is to reduce costs – making changes in terms of people, supply chain and overheads to better control costs and compete with digitally powered, low-cost newcomers.
Combinations of cloud programs that automatically swap information as required can help slash administrative overheads in all professional services businesses. Data entry is one of the low hanging fruit that can usually be replaced with cloud programs.
One example: A builder from Sydney’s northern beaches and self-described technophobe collects business information from new contractors with a web form he made with Google Apps. The contractor enters his bank details, trade tickets and phone numbers in the form and it automatically appears in a spreadsheet in Google Apps.
Insourcing has replaced outsourcing as the use of foreign labour services matures into an inevitable addition to many Australian companies.
Another given is the ability to access any information your business owns from anywhere. By using the relatively cheap and easy to implement internal collaboration and communications tools now available, companies can increase the exchange of knowledge among staff, foster internal networks and unlock the huge reserves of tacit knowledge residing with the business.
We are at the beginning of this journey through digital disruption. Few companies realise the pace at which their industries are changing, and how the idea of “business as usual” is quickly becoming a dangerous rule to follow.
Clients will stick to what they know only for as long as credible alternatives remain scarce. As the next generation of entrepreneurs breaks through the ranks, a good understanding of technology will become an expectation of success in business.