PERSPECTIVE: Owner Focus Key to Software Success

John Wolz

How important is good software to a distributor?
According to consultant Bill Muehlbauer of Distribution Strategies, good software is essential to success.
“With the pace of business, you can”t get away without it,” Muehlbauer told FIN. “You”ll be hobbled without good software.”
Yet only about 30% of distributors use their business software effectively, he explained.
At a recent seminar sponsored by the Western Association of Fastener Distributors, Muehlbauer offered some guidelines to selecting good software.
First, you should examine why you think you need new software. Is your current vendor going out of business or failing to provide upgrades? Those are solid reasons to look at new software. Likewise, duplicate document handling, including “work-a-rounds,” keeping logs in spreadsheets, copying data from reports into spreadsheets for reporting, graphing or tracking could signal that you need new software.
As Muehlbauer explained, multiple data entry points can greatly increase the chance for error.
And if your business has seen dramatic growth, or is branching off into new areas that your current software can”t handle, you might need to incorporate new software to continue your business success.
However, if your computers need to be replaced to handle your current software, replacing the computers might be a simple economic decision. Software won”t boost computer speed or memory capacity.
Another misguided reason to buy software is a high rate of errors, returns and complaints. Muehlbauer said those issues have more to do with work processes and training than software. It”s a mistake to think simpler software will fix those problems.
Muehlbauer also warned against assuming that most new software can handle 95% of business processes equally well.
If there”s one thing his 30 years in the business has taught Muehlbauer, it”s that newer isn”t always better. Some of the best success comes from older software that”s well utilized and is a good fit for the company using it.
He suggested looking at the capabilities available with your current software before dismissing it. Taking advantage of unused capabilities could extend software life for a year or two and provide the savings to fund the new software project.
If you still think you need new software, look for a profitable vendor who services other customers like you and keeps up with technology. A good software package should also meet your company”s top five needs.
Muehlbauer advised involving a reliable consultant someone who knows distribution and software early on in the decision.
“The vast majority (buy new software) on their own. It should be the other way around,” he stated.
Muehlbauer said the intangible quality of software often compounds the “mystery” surrounding the selection process.
“It”s not like buying a sorting machine or delivery truck” that you can get your hands on, he explained.
The risks of integrating new software are considerable. The wrong software could shut your operation down or force you to waste a lot of money trying to fix the problem. The transition could also take considerable time and burn out key personnel.
“If things go well, it will be a major disruption for six to nine months.”
Reasonable expectations are another important part of software success, Muehlbauer said.
“There is no perfect software or vendor out there,” he cautioned.
Surprisingly, it”s not software or even a reliable vendor that determines the success of a transition to a new system. Muehlbauer said owner commitment is key to software success. The owner has to believe the new software is essential to the company”s survival in order to get employees to help make a successful transition.
“Otherwise, don”t even bother,” Muehlbauer advised.
Bill Muehlbauer can be reached at 1592 Bellevue Blvd., Fond de Lac, WI 54935. Tel: 920 922-7499 E-mail: Bill@distributionstrategies.net \ �2006 FastenerNews.com