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Computerised The Back Office System in Your Small Business: Is It Really Necessary?
August 3rd, 2008 | Author: Ahhh – Technology. It really simplifies our life.
Or does it? Well, not always, really. Especially in running your small business.
Having an exceptional system for your business is important, but the question is, do you REALLY need the system at the moment?
People always seek efficiency, but often your business back office system is actually slowing you down.
Consider this scenario
Consider the following scenario, to make my point.
Do Mom and Pop Pastry Shop down the road in your neighbourhood really needs to have a computerised system that manage shop book-keeping and stock control?
In my humble opinion – not really.
The old ways of doing business – pen and paper (and a calculator) are sometimes better than computerised system, not mentioning the unknown return on investment.
A system of PC + cash register + networking + software + fixtures can easily cost you more than $2500, excluding training on how to use it.
Where’s the return, if what you are actually need to do is to count how many pastries you made and sell today? I think the system even slow you down.
Focusing you not on the business, but on the back office system.
Not a good business solution.
What’s more, even big companies are investing millions of dollar on integrated system, that is highly questionable in term of return.
There always are pros and cons on this, but, again, in my opinion, integrated back office system is over-hyped.
When you actually need computerised back office system
If there’s only one thing to do here, is to asses your business back office management need. Use a system if and only if you feel it will INCREASE your productivity – i.e. serving customers faster and better.
When you feel that a back office system is eventually needed, please consider the maintenance and depreciation costs of it, because from my experience, such integrated and computerised back office system is high in maintenance, except you yourself is an IT guy that can fix the system well.
Please share your opinion by commenting in this post :)
Ivan Widjaya
Pen and paper back office system
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About the Author
Ivan Widjaya is the Owner/Editor of Noobpreneur.com. He is a web property investor, blogger and web property maker, and currently manages and writes for My Web Estate. He also runs a web design business, Chalcedony Design, specialising in Wordpress theme creation, and plenty other web business.
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I fully agree. A computer is generally a ticking timebomb that will cost you money to buy and maintain. Unless you have a good reason for it, keep it out of the loop of your day-to-day operations.
We have a gift, invitation and embroidery business and for us a computer is essential for inventory tracking, embroidery and printing. But to mitigate the risk, we have a web-based backup system which backs up our entire database every night. With that a hard computer crash will cost us a day or two of time. Without it it would cost us man-months to replace.
Many small businesses near us only have an old fashioned cash drawer, and that is all they need.
posylane,
People do think that if they had computerised system ready, they could work less – they coudn’t !
Computerised system helps with the business’ effectiveness and efficiency, but doesn’t always mean less work for the biz owner.
You are right – backup is very, very important. Web based backup is the right way to go!
Thanks for leaving a comment – good luck on your gift, invitation and embroidery biz :)