How Small Businesses Invest in Technology Part 1: Production-centric Companies

We fear change!

Have you ever come home to find that someone has moved your favorite recliner? (Shouldn’t be a big deal, right?) But your first slightly irritated reaction may have been: “Why did this move?”

Humans are creatures of habit.

The truth is that we’d like some things in life to be concrete and not to move or change. According to popular personality testing, there are 4 personality types and three of them fear change—that means the majority of humanity fears change!

Over the years, I’ve had the opportunity to observe how companies of different sizes tend to adopt new technologies. From my perspective, engineering and manufacturing companies can be grouped into three general types: production-centric, engineering-centric, and business-centric.

I will explore each of these types in this 3-part blog series, starting this week with production-centric companies.

Technology Perceptions

How a company perceives new technologies depends greatly on its primary figure. If the leader of a company comes from the production side of the business, then technology advancement and improvement activities will be primarily focused on the needs of production.

And that makes sense.

These companies build physical products. They typically do not see a need for design technologies, because they build products from existing designs, which are provided to them by their clients. Most production-centric businesses can get by without much technology investment, at least in the initial stages of the business.

But as their client base diversifies, so do the needs. Oftentimes, these newer clients will become the driving force to adopt Computer-Aided Design (CAD) or Computer-Aided Engineering (CAE) tools.

Unfortunately, this “technology adoption” usually begins in a panic.

A client sends digital design files or other specifications that need to be directly imported, and the production-centric group doesn’t know how to handle these files. If this customer uses a specific CAD tool, then that is what the vendor company will typically adopt. It may not be the best technology choice for them as an independent company, but there is too much pressure and too much on the line to make a rational, well-formed decision.

To avoid knee-jerk investments in new technology, I try to encourage companies to consider adopting the right technologies BEFORE they need them. Without this unnecessary pressure, decision-makers can select the products that are not only the most cost effective, but also have the power and capabilities they need to grow with their increasingly diverse customer base.

The Right Technology Leads to Improved Global Competition

While production-centric companies obviously see great value in machine tool technologies, they have a harder time seeing the benefit of other technologies. Once they take a chance and invest in the appropriate technology tools, they can then witness the capabilities and efficiency it provides. These gains lead to better products, in less time with less effort.

Watch for the next post where I will explore the technology adoption tendencies of engineering-centric companies.

This entry was posted on Tuesday, April 22nd, 2014 at 12:34 pm. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.