SPECIAL REPORT ENTERPRISE: Technology: SOFTWARE
PROGRAMMER? WHO NEEDS A PROGRAMMER?
Over the years, Derek Roe's quest for the perfect small-business software package was a cheerless one. He tried buying off-the-shelf packages but found them inflexible and difficult for employees to grasp. Later, Roe doled out $5,000 for a custom-made program. It, too, failed to deliver the features he wanted to run his San Rafael (Calif.) hair salon. "I never quite got the package I wanted," he says.
So last year, Roe decided that the best way to get the job done was to do it himself. Although a self-described PC aficionado, the 56-year-old businessman has no formal computer training. But starting with off-the-shelf database, word processing, and desktop-publishing packages, he plugged away in his off hours, poring over manuals at the kitchen table. A year later, he had just what he wanted: a system that balances his books, calculates taxes, schedules employees, and orders supplies. He even generates custom postcards that remind customers when their regular stylists will be on vacation. "This package can do nearly everything on its own," boasts Roe.
A growing number of small-business owners such as Roe are finding that the best way to get the software they need is to roll up their sleeves--and roll their own. What's making this possible are twin trends in PC software: the emergence of office "suites" that include all the basic business packages--spreadsheet, database, and word processing programs--and relatively simple programming features for tailoring suites to particular needs. Starting with the spreadsheet, which has a variety of sophisticated math capabilities, a company might create a custom sales reporting and forecasting system--without ever hiring a professional programmer.
"The movement toward customization isn't because there are more programmers around," says Tim Landgrave, a small-business consultant based in Louisville. "It's because there are more products that are modifiable." The resulting semicustom programs hold the greatest promise for small companies since the PC made computing affordable. "By combining your expertise with an office suite," says Donald DePalma, an analyst with Forrester Research Inc., "you get 95% of what your law or retail office would want."
HIRE LEARNING. Consider Communication Resources Inc., a $6 million paging services company. After reviewing alternatives, the company hired a consultant to replace its off-the-shelf operations management package with a customized system it built around Microsoft Corp.'s Office suite and its FoxPro database. "We've customized software that meets the needs of our business," says Carlton W. Roach, controller at the Arlington (Tex.) company. For example, Roach modified a database program to track inventory for the first time. Now he can better predict when to reorder pagers, and keep tabs on repairs. And financial reports that used to take hours to produce crank out in seconds.
Using packaged software as a cornerstone can make hiring and training easier, too. There are tens of millions of workers who are familiar with these popular programs and millions who are skilled enough to customize them. When Communication Resources' sole programmer left in the midst of producing a new online training manual, Roach phoned a professor at the local University of Texas branch for a referral. Within days, he had a new employee finishing the project.
Now, the companies that sell suites are paying attention to how they are being used by small business. Microsoft estimates that 40% of its $4 billion in annual sales comes from small to medium-size companies. In the last three years, the software maker has assembled an army of 10,000 technical support companies in its network of "solution providers." These companies--the vast majority of them small, local consultants--apply technology to small- and medium-size business needs the way that systems integrators do for corporate behemoths. Lotus Development Corp. claims 9,000 such companies. Novell Inc., meanwhile, is targeting small businesses with a mix-and-match package called Perfect Office Select. It will let customers choose from dozens of packages by Novell and others--from accounting and project management to specialized legal and financial programs--to create a custom suite.
SUITE FREEDOM. Another trend that favors small business: The mostly small software makers that cater to them are adapting their products to work with the suite programs. Companies that make small-business accounting packages, such as Macola Inc. in Marion, Ohio, have created links to spreadsheets from Microsoft and Lotus. Now, the spreadsheets can generate financial reports from Macola's General Ledger program. That frees Macola from having to build its own report software and lets it concentrate on its area of expertise, accounting.
Suites aren't the only option. Software makers are beginning to offer "templates," bare-bones programs that can be used as a framework for creating custom applications. Vivid Business Systems Inc., a Mountain View (Calif.) startup, is creating business-specific templates that give a small company the chance to do its own systems integration project. Vivid's first product, due next year, is aimed at retailers and distributors. It walks nonprogrammers through the design process to create custom order-processing software. For instance, the program ticks off a checklist of features, such as the type of credit check required or whether partial orders can be shipped, and then automatically builds in the desired features. "We've cracked the code on how to customize things," says CEO Barry James Folsom.
Longer-term, software "objects" could provide the next big leap for small business. The concept involves organizing software code into small, reusable building blocks that tackle specific tasks. A company could plug in a sales tracking module, for example, rather than writing its own. Ultimately, objects could enable nontechies to assemble programs from prefabricated components--without any programming at all.
For now, template and semicustom programs still require some programming skills. But acquiring them is worth the effort, says Bill DeLisi, vice-president of GroupWare Solutions Inc., a Boca Raton (Fla.) software boutique that creates applications based on Lotus Notes. He encourages clients to tap their own employees to create simplified programs, such as customer order forms. That, says DeLisi, gets the people who know the business best involved in designing the system.
That expertise can also pay off in unexpected ways. Two years ago, Goodwins' Market of Quality, a Crestline (Calif.) grocer, hired a consultant to help design a retail operations system. The company decided on a customized program based on Microsoft's Access database and Excel spreadsheet. Now, Goodwins' has four in-house programmers, compared with none two years ago. Why? It needs them for a new sideline--selling its software to other retailers.
Even the most intrepid small-business owners will find it can be tough going it alone--as hair-salon owner Roe attests. When he ran into tricky problems, including how to store common data such as customer names, Roe got help by logging onto a forum on CompuServe. Ken Getz, a Los Angeles programmer Roe met online, says novices are notorious for failing to grasp the importance of good database design. "They dump everything into one table," he groans. Now, as small-business owners like Roe tackle the task of designing their own programs, there's another table many are using to get started--the kitchen table.By Gary McWilliams in Houston