Magazine article Management Today

The Power Behind the Button

Magazine article Management Today

The Power Behind the Button

Article excerpt

Information is the killer weapon of the 1990s. Companies that can press a button and produce the answers first are the ones that will win. The power behind the button is a computer network.

By providing instant access to information, computer networks enable a company to improve productivity, cut inventory, respond faster to changes in the marketplace, and exert strategic control from the centre based on a clearer picture of the business position. 'Trying to run a business without a computer network will soon be like attempting to operate without a telephone,' says Tony Linsell, strategic communications manager at British Telecom.

Market analysts expect computer networks to be one of the biggest growth areas of the information technology industry in the next few years. According to Dataquest, the market research company, 41% of all PCs sold in the UK will be linked to networks by 1995 -- more than anywhere else in Europe. 'In its simplest form, a network consists of two computers joined together. This could mean an office sending orders to a factory down the road rather than someone having to leg it with a piece of paper,' Linsell says.

But implementing a network can be a complex and expensive task which requires careful planning. Linsell advises taking a long cool look at your business, and deciding where you want to be in five years time. This is also the ideal opportunity to move in a new direction. The goal is not to automate existing structures, but to make your company flexible and well-equipped to cope with change. For example, you could cut overheads by having staff work at home with a phone, fax and personal computer.

Don't allow yourself to be carried away by the wonders of new technology. One of the most common mistakes is overestimating equipment needs. Many users do not require the latest technology and but too much powerful equipment. However, be sure to plan a system that can grow as your business expands.

To justify a network, information created in one place should be needed somewhere else, says Linsell. Part of your business assessment should be a 'communications audit', he suggests. This includes examining your use of electronic media such as fax, telex and existing networks. But it should also involve aspects of the business that may not normally be viewed as telecoms. 'For example, how much time do you waste in meeting? A better communications system could make then unnecessary. How much paper floating around your in-tray could be delivered directly to your screen via electronic mail? One recent survey found that companies spend on average more than one third of their budget on communications, less than half of which is handled by computer.

The next step would be to examine detailed questions such as how far the network should extend, how users should be billed and how much intelligence should be provided so that, for instance, users could be recognised wherever they log on. A small company might choose to transmit the day's business from each of its sales outlets to head office overnight, so as to take advantage of cheap rate calls on the public network. On the other hand, a company with lots of calls abroad might achieve substantial cost-savings by going to an independent service such as Value Added Network (VAN).

However, VAN's offer relatively low transmission speeds for data, and tend to be targeted at specific users such as retailing or banking. A multi-national corporation with constant need to be in touch with overseas business contacts for voice and data communications might find it more appropriate to use leased lines. The more crucial the line to a company's core business, the more back-up and contingency measures are needed.

The simplest network connects several personal computers in one office -- a Local Area Network (LAN). It offers considerable cost and space savings by allowing users to share expensive peripherals, computer power, software and information files. …

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