In the last issue of Xylon we began introducing the topic of software. We tried bringing some clarity on this tool, which is becoming more and more essential in the modern way of doing business, but unfortunately not simple and easy enough for everyone to understand…
Some may think that the biggest problems with software are related to users of a certain age, but based on my experience in the field, I can easily say that that’s not the case. The real issue is the closed-mindedness of people and companies towards the current process of technological transformation and the predisposition to passively undergo change instead of understanding it and taking control of it.
With these articles I’d like to help identify the concepts and parameters that need to be analysed and understood in order to make informed decisions, to make long-term planning and to make investments with the potential of turning into solutions that will help the growth of our companies.
In these articles we have understood that our companies – from an Industry 4.0 perspective – must aim to standardise, merge and interconnect each department (commercial, administration, design, production, etc) according to a logical flow and a single philosophy. We’ve also seen that the brain of every company today is identified as the software, which acts as the glue in the management of various daily activities of the company.
It is precisely for this reason that, when choosing a software, it’s important to truly think about the concept of scalability.
The word “scalability” itself – uncommon in our daily use – makes us to think of going up a ladder or increasing/decreasing the size of an object.
This term in fact, mostly used in the IT field, indicates the ability of a computer system or software to increase (but also decrease) its functions depending on the needs that may change over time. When evaluating software, we tend to focus on the most contingent and frequent problems that we encounter, that annoy us, slow us down or that damage our daily activities and that we therefore feel most eager to solve.
For example, if we feel that we’re taking a ridiculous amount of time to make price quotes, that the calculations we’re making are too rough, or even worse, that all information regarding customers, price lists and materials are stored exclusively in our heads, it’s easy to understand how our attention will focus first on trying to satisfy one or more specific aspects that are making us feel a sense of inadequacy or anger.
Something similar could happen after purchasing a brand new CNC machine worth hundreds of thousands of euros.
My main concern will be making the most out of it by optimising the processing, reducing downtime, making operations simple and automatic, and finally making sure that everything is optimised and efficient, meanwhile rewarding me with pride and satisfaction. Almost like having a Ferrari and being able to drive it at 300 Km/h.
But when it comes to software, focusing only on the present is not enough. In fact, it could be a serious mistake that in the following years may cause large limitations, or even unpleasant and unexpected expenses. Bringing a software into the company, in fact, doesn’t only mean making an investment at the time of purchase, but also means investing time to train your own employees, investing time to load the program with all the company’s data, price lists, processing or production times — activities that translate into further
fees.
This is the main reason why we should pay a little more attention on the topic of software: to understand how we want the future of our company to be like.
What do we want to do when we grow up? Maybe in two or five years…
In which areas or skills are we lacking today? What field haven’t we nurtured enough and risk lagging behind in, compared to our competitors?
Once we have satisfied our current “itch”, what should we do next to allow the company to grow in a balanced and homogeneous way?
Let me make it more practical and show you an example to understand what the reasoning patterns of a company should be like today, because as we all know every company has their own budget, their own ability to make investments, some more than others, but still limited in every case. So it’s absolutely necessary to plan, with long-term prospects, how to invest that money.
If, for instance, nudged by an emotional/psychological component, I were to invest 98 percent of my budget in the best machine on the market (just to feel cool and show off to my competitors), invest it in producing 50 different types of products (some of which might have little market presence and low profitability), or even invest it in a huge warehouse (still due to purely emotional reasons related to the comparison of “big warehouse, big businessman”), despite being aware of my problems with delivery or having nothing to invest in marketing, trades or otherwise, it would be the classic example of a company that doesn’t grow in a balanced, homogeneous way and with one clear vision for the future.
Basically, it’s like being one of those gym rats that clearly skipped leg day and show up at the pool in summer, with shoulders as broad as an 8-door wardrobe and chicken legs. These are the ones you see by the pool, because championships and competitions worth winning are done by those who have invested time and long-term effort to develop their bodies in a balanced and harmonious way.
So assuming we all want our companies to grow and to develop in every aspect/function in a balanced way, we have to take software into consideration.
If it is true that software is the brain of every company, in case the company grows, will the software keep up the pace? In other words, is the software scalable?
Having a non-scalable software means that at the first change in demand, the software will become a limitation, and when the software fails to keep up with the growth of a company it means that the software needs to be replaced with something more scalable.
What does it mean to replace a software in terms of money? It means that the investment you made, with all the hours of training for your employees to understand the old non-scalable software, are magically transformed into losses or, to put it in a different way, they end up falling into the category of ‘worst-spent money ever’, right there with parking tickets. Obviously, more often than not, bad choices don’t come cheap, and the damage doesn’t end here, because now you will have to invest in more time (money) to train your employees on the new scalable software.
It also means that all the data that was inputted within the old non-scalable system over time, is now lost, it can’t be recovered and therefore it takes time (money) to input them again within the new scalable software.
To be honest, having to input data all over again is not always a terrible thing, because it often helps us realise how the company has changed in regards to internal procedures, processing and products, so getting rid of all the data that had been inputted over time (sometimes even with a trick for dealing with unforeseen situations/conditions) can also be a breath of fresh air and it can give the chance to re-enter information according to the current, leaner and probably more efficient vision than past ways and customs.
That said, it doesn’t mean that if today, for example, I were to want to improve my business department using software to manage price quotes, price lists and so on, I should immediately start worrying about every the other aspect (e.g. CNC machines, the warehouse, production tracking, etc.) in order to manage my company in balanced way. However, I should at least ask myself, “once my demands change, will the software that I choose today be able to deliver more and help me grow my company?”, which I highly recommend doing to prevent ourselves from having to pay out of pocket for this lack of foresight.
Then once we have the guarantee that the product that we are going to choose is scalable, we could even decide that a limited set of functions (referred to as “modules” in programming language) is enough for the time being, just to properly manage our current “itch”, until we decide to apply new functions into the departments that require improvement to make the company grow homogeneously.
Software is such a transversal tool in companies of all kinds, that I often allow myself to make some more entrepreneurial considerations in these articles.
So I hope that the concept of balanced company that we touched on today will also help us in making future decisions for our companies, lest we risk what happened 20 years ago, when Fiat Uno Turbo’s were still around. The engines were toned and made very powerful for a Fiat Uno, but nobody ever touched the brakes, so when they were fired up at high speeds, well, we all know how that went…
See you next time!