Restructuring to Accommodate the Technology
The computer system was basically implemented overnight and caused very little disruption to the normal running of the business. Sue received two hours of training from the supplier, and she then trained her staff to use it. Despite the fact that many of the staff had no previous computer experience, most of them have been enthusiastic and excited about using the computer system, and Sue says that they usually "take the ball and run with it". Since implementation, there have been no problems with the software, and there has been no need for IT support staff. The only technical problem faced so far has been a hard drive crash - here the PC was sent to Auckland for a reinstall.
Although Sue could see the benefits of implementing the new system, Planet Skin was pushed to the limit to purchase Hair Ware 2000 initially. Especially given the original size of the business, it was an expensive system, but it was seen as necessary to grow the business and to get ahead in the industry. The capital cost of the system was $15,000, plus the cost of the two new computers. Other expenses associated with the technology are the $350 annual licence fee and the power costs of running the computers. Although the power costs for the computers are not separated out from other power costs of the business, Sue suggests that the power costs of the computers are not very high, especially when compared to the high power usage of the rest of their equipment.
As far as the information process of the business goes, there has not been a drastic change following the implementation of the technology. Table 1 outlines the information process for a typical client:
Table 1: Typical Process for a Client at Planet Skin| Client books appointment (usually by phone) and receptionist enters the appointment into the system. |
| Client is phoned a day prior to their appointment to be reminded about appointment. |
| Client arrives at salon and receptionist registers the client in the system - here client details can also be viewed (such as previous appointments, treatments, products, any prescriptions, and previous payment details, as well as personal details). |
| Client has a consultation with their technician. |
| Technician goes to reception desk and enters details into the system (such as treatment performed, prescriptions and products, any advice given to the client). |
| Client goes to reception for billing. Receptionist looks at the details entered by the technician, gives the client any prescriptions and products they require, and bills the client accordingly. Payment details are recorded into the system, as are any rebookings. |
| Management can view all of the details about the client's appointment and check to see if the client was rebooked after the appointment. |
The current core business process is not very different to that under the old system, most of the functions have simply been automated. The main differences under the computer system are that the technology has centralised activities at the computers, and tracking, checks and analysis have been made possible, adding to the integrity of the data in the system. Currently, Ian believes that only 25 percent of the system's capacity is being utilised. This is not seen as a problem; rather it is part of a very structured approach to implementation of the technology. Sue has been very judicious in adoption of the software, prioritising gaining competency and confidence in use of those features that are important to her particular firm, and gradually phasing in the use of other features according to how useful they will be to Planet Skin. This prioritisation is consistent with the reasoning behind implementing the system right back at the planning stage - specifically, using technology to better market the business and manage client relationships. It is also consistent with the argument that the ability to learn and experiment, which leads to development of complementary investments, affects the ability to obtain productivity gains from technologies. 1
Quite significant changes to the marketing side of the business have occurred with the technology, with customised marketing being made possible on the computer system. At present, expenditure on different marketing approaches is approximately as follows:
- Advertising in the yellow pages: $3,000
- Newspaper advertising: $2,000
- Direct mailing (using the software): $6,000
Without the computer system, these figures would be reversed with priority being placed on yellow pages and newspaper advertising. The willingness of management to make these changes to the mix of the marketing function and expenditure may have been a vital contributor to the successful uptake of the technology. The marketing function of the software is particularly strong, but according to Ian, many firms do not use this feature of the system. He suggests there is perhaps a mindset within the industry that "if you're spending money, then you're doing okay", but often not enough assessment is carried out of whether particular marketing techniques are actually adding value to the particular firm. The "test and measure" technique employed at Planet Skin to analyse advertising and technology investment ensures that any investment in these areas is well planned, preventing spending for the sake of spending.
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