Wired for success: increasing the technology in your business could also increase its efficiency and profitability.

IN 1993, DA STREETZ INC., AN URBAN MARKETING and advertising firm, was a typical small business, using two stand-alone IBM-compatible PCs to handle all aspects of the operation, from accounting to contract management. That worked just fine for a two@person operation but as the company added more employees and computers, the need to develop a local area network (LAN) became inevitable.

"If someone needed to print a document, they had to save it on a disk and take it to the only computer that was connected to the printer," says Da Streetz's 29-year-old president Chris Latimer. "There would always be a line at the computer with the printer and we were losing a lot of productivity." Today, the business has seven employees and eight computers, including two laptops, multimedia PCs, communications and mail servers and a router with ISDN access to the Internet.

Despite its state-of-the-art technology, the glitz and glamour of a high-tech office isn't what strikes you when you enter Da Streetz headquarters In New York City's SoHo district. In fact, the only tangible difference between this company and many other small businesses is that by aggressively incorporating technology into its operating procedures, Da Streetz is now wired for success.

Started in 1992, Da Streetz, which grosses about $700,000 per year, provides product placement, event planning, promotions, advertising and points-of-sale ads for Da Da sportswear and Tanqueray Gin. The company has also worked with Reebok." Helly Hansen sportswear, CCM sportswear and Merrill footwear.

Despite a healthy bottom line, Latimer realized by late '93, tightening up the company's record-keeping procedures could yield additional savings. He had been having trouble accurately tracking expenses Da Streetz had incurred from its accounts. The solution: Adapt the computer system to track expenses that could be billed back to the client. "I didn't just want to get technology for technology's sake, but I needed to solve a business problem", Latimer explains.

"We plan events for our clients that often require heavy mailings, phone calls, and overnight deliveries, and I needed to be able to forward those costs to the client -- or, at least, account for it in my rates."

Early in 1994, Latimer enlisted the help of Darryl James, CEO of KBL. James and Co., a computer systems consulting firm based in Manhattan. KBL James has helped such companies as Black Expo, Smith Barney and AT&T solve computing problems. Notes James: "Chris, problem concerning billing clients effectively is common among small businesses."

The first step was for James to interview each member of the Da Streetz staff to find out what their job entailed and their computer requirements. "I have to understand the workflow procedures and priorities of a company before I present a total solution," he explains.

He then presented Latimer with a detailed report recommending and explaining the type of system that would be best for Da Streetz, including operating system and applications to be stored on the server for centralized access. "He's [Latimer] the best kind of client," says James, "because he automatically wants to see the cost justification behind the upgrade I propose."

On his side, Latimer asserts, "as long as I can see where and why the money is being spent, and how it's saving me money, I'm all for it. But I'm not the type to just throw money at technology."

PRIORITIZE THEN IMPLEMENT

When adding technology to your operations, be sure that it's based on business priorities. Since Latimer's most pressing concern was the ability to get a handle, on the calls being made on his clients, behalf, the first thing to be implemented was not a computer system but a fairly low-tech, telephone code system so that client calls can be tracked and recorded. "Before anyone makes a long-distance call for a client, they have to dial that client's code," explains Latimer. "It allows me to obtain an accurate, detailed report of all calls that were made and bill clients accordingly." The same system was also implemented for faxes.

Now, he can charge his clients to the exact cent rather than manually compute phone billings for a particular client by adding each call on the phone bill or "guess-timating" their total phone costs. Some of Da Streetz's clients are billed on a flat-rate basis. In the past, a low estimate, or unexpected volume of phone calls, would often mean that Latimer's firm would have to assume those costs as part of its overhead rather than bill the client. The client code system helps him to make better projections for calls in his flat-rate fees.

James is currently working on a system that will aggregate all of Da Streetz billable expenses, including phone and fax bills, American Express charges and next-day air charges on a per-client basis. The reports will then be imported directly into an accounting system that will allow Latimer to run a profit/loss program to see if any expenses were incurred that weren't billed to the client.

BUILDING A NETWORK

The next step of adding more computers and creating an effective LAN was a high priority. His computers needed to be upgraded or replaced since Latimer wanted to have access from his terminal to files stored on any PC in the office. He also wanted to be able to allow or deny access to certain centralized files and applications based on employees, needs. However, when it came time to invest in new hardware, Latimer was somewhat reluctant to let go of the four 486 PCs he had amassed by the time he called KBL James.

He relented, however, once he realized the cost of upgrading to suitable performance would be nearly as costly as buying new Pentium-equipped fully loaded multimedia PCs. Latimer did manage to hold on to one of the 486s to which he added four Dell PCs for about $1,600 each, including monitor, CD-ROM drive and 16 megs of RAM. James then installed a network for interoffice e-mail, security, and file, application and printer sharing.

TELECOMMUNICATIONS

Even though Latimer is more technosavvy than many small business owners, he still has to be convinced that he needs certain things. James tried to persuade him to invest in a router, a device that forwards data from one LAN site to another. Each of his employees could then receive Internet e-mail on his or her desktop rather than having to go to a central computer to retrieve it. This would avoid problems similar to those that resulted from having one computer connected to a printer. It wasn't until Latimer realized its potential that he conceded the $1,500 to purchase a router.

The company recently installed an ISDN line to facilitate faster transfer of electronic data at a lower cost. Da Streetz creates advertising layouts, designs for Web pages and invitations for events that it gives to clients roughly three times a month. All creative graphics, executed inhouse by Anthony Rahsaan, Da Streetz's desktop publishing specialist and inhouse computer guru, must be sent to the printer electronically via telephone lines. The printing company Da Streetz uses is located on Long Island, but has an office in Manhattan where its customers can send their files -- for a fee, of course.

"It cost $130 plus printing costs for each layout we produced because I was using their facility to send the files," Latimer explains. The ISDN line cost $250 to install and $69 per month. "On printing alone, I save at least $4,000 a year by having our own ISDN line." The company also uses the line to transmit graphics to and from its Canadian partner Nu Net Media, which Da Streetz allied with to create Web sites for its clients.

AN ONGOING PROCESS...

KBL James has been working with Da Streetz for nearly two years, implementing different advancements as the need arose -- and when James could convince Latimer that it justified the cost. All told, Latimer has spent nearly $30,000 upgrading his system over the past two years, and still isn't finished. "It's an ongoing process," admits James, "but it pays off in the long run because it will save both time and money." Latimer estimates his company saves $2,500 - $3,000 per month, not including savings from the installation of the ISDN line.

James has also implemented Net Meeting, a Microsoft product that now allows Da Streetz to collaborate and conduct phone conversations via the Internet. Latimer has a laptop equipped with the software and hardware necessary (microphone, speakers, modem) to call the office from his laptop during his frequent out-of-town business trips. Other account managers and Da Streetz clients are also equipped with the Net Meeting software so that they can conduct business via the Internet without incurring high long-distance charges.

Companies that are thinking about automating some of their business processes should make sure they have a thorough understanding of what they want to accomplish. As James says: "A lot of companies think they should have a network but aren't sharing any files or resources, so they end up wasting their money." Technology offers many advantages to small businesses but the technology itself should never be the focus. Remember: Technology should be used as a tool to solve a business problem.