Electronic commerce is a distant dream if a company isn’t internally computerized, says Michael Gemmer, president of The Gemmer Group Inc. in Akron.
He’s been called in more than once to help pick up the pieces after an anxious CEO has authorized purchase of expensive new computers and software, watched it piled in the middle of the room, then wondered, “What are we going to do with all this stuff?”
“The essence of e-commerce is replacing manual systems with electronic ones and integrating everything,” Gemmer says. Before buying anything, he advises businesses to struggle with precisely the process Yesterday Corp. followed: Figure out what you need and want to do, weigh cost and benefits, settle on a time frame for meeting goals, then buy the appropriate hardware and software to do it.
Even after that, Yesterday Corp.’s president, Tom Sincharge, wasn’t clear about exactly what kind of equipment his company would need. Though the consulting firm that won the job of moving Yesterday Corp. into the computer era promised to make all the appropriate selections, Sincharge wanted a gut check; he wanted to see some kind of hardware and software shopping list.
He solicited the advice of A.J. Vasaris, president of The Anderson Group in Akron, which specializes in systems integration, computer network design and consultation.
Vasaris emphasized there are plenty of options and prices and capabilities are constantly shifting. However, here are some basics Vasaris told him would be needed to get Yesterday Corp.’s e-commerce project moving.
Server
The central computer of a company’s network. Because Sincharge had already been sold on a system utilizing the Microsoft Windows NT operating system (as opposed to Unix or Linux operating systems), Vasaris specified the following:
- Intel-based server, with 256Mb RAM, hard drives, tape backup, monitor, etc.;
- NT Server V4 software with licenses allowing access by up to 20 users (industry jargon: client access license);
- Expansion could be provided with additional hard drives and memory, additional processors, redundant power supplies and network interface cards.
Rough estimated cost: $15,000
Database application
The software starting point for maintaining customer, prospect and sales information; inventory; online catalog, etc. Though there are many database applications, Microsoft SQL is a solid benchmark. Vasaris priced the server version, with a 25-client access license.
Estimated cost: $4,000
Accounting system
Again, there are many options. Vasaris recommends a modular system, including general ledger, accounts payable and accounts receivable. Short-term add-ons needed for Yesterday Corp.’s project would include: sales order processing, purchase orders, inventory, bank reconciliation, reporting applications.
Estimated cost: $18,500
Electronic Data Interchange and e-commerce
To computerize financial transactions, Yesterday Corp. would have to buy EDI and e-commerce modules to interface with the accounting system. Ballpark estimates depend on technical specifics not defined in this project.
Estimated cost for EDI module: $10,000
Estimated cost for e-commerce module connecting the accounting system to the Internet: $2,000
Estimated cost for e-commerce module for processing requisitions over the Internet: $2,000
Estimated cost for e-commerce module for processing orders over the Internet: $2,000
Messaging system
Internal voicemail and communications within the company’s local area network. Vasaris priced another benchmark, Microsoft Exchange Server V5.5, with a 25-client access license.
Estimated cost: $2,500
World Wide Web-building software
Yesterday Corp. would need software to create and modify its Web site. Dozens of packages are available, offering a wide range of capabilities and variables for an equally wide range of prices. Name brands include Microsoft Front Page, Adobe Page Mill. Basic software costs as little as $79. For flexible programs for commercial use, Vasaris says you’ll probably spend more.
Estimated cost: $500
Infrastructure
Devices to interconnect all the equipment in the office and to connect the office network to an Internet Service Provider. Equipment includes stuff with names like “router,” “CSU/DSU” and “hub.” (That’s why you have an IS director.)
Estimated cost, excluding cable: $4,000
Work stations
With all of this technology, Yesterday Corp. needs to put new computers on a lot of people’s desks to let them access all the information. The job doesn’t require high-end computers. Run-of-the-mill PCs, with 266 mHz chips, standard 15-inch screens, keyboards, Ethernet cards (to access the network), CD-ROM drives and basic office-suite software (word processing, spreadsheet, etc.) should do the job.
Estimated cost for 20 such PCs: $20,000
Laptops
If the goal is to get vital information into the hands of employees, the sales force and other staff who travel should have laptop computers. Vasaris says the equipment doesn’t need to be high-end. It just needs to be up to date.
Estimated cost for 10 such laptops: $17,000
Vasaris emphasized to Sincharge that this product list represents just a small selection of available solutions. Costs, he noted, are based on providing products for a 20-user enterprise. Design, configuration, training and support costs are not included and will need to be added to the noted figures. Same for monthly communications charges and Internet access fees.
“If we take away the proprietary names, such as NT and Microsoft, these costs would be about the same for a Unix system and/or an [IBM]AS/400 for 20 users,” Vasaris said. “The differences come about for ‘soft costs’ such as support, installation and maintenance. “
How to reach: The Gemmer Group (800) 831-3977; The Anderson Group (330) 945-6408
Action points
- Spec out all equipment needs at once to assure expandability and compatibility.
- Buy in stages. Even if you can afford to pay for all the toys, a wholesale makeover can strain operations.
- When comparing hardware, speed and memory are most important. Buy as much of both as you can afford.
- Move quickly, before the array of options becomes immobilizing. No solution is perfect, but many are probably suitable-and all are changing daily. Once you have good information, make a decision and stick with it.