Small Businesses Benefit From Logistics Tools
Small business owners tend to dislike the executives of the major conglomerates they compete with
, but in one way small businesses benefit from those much larger rivals. Certain software systems, such as CMMS software, that have been developed to solve the logistical problems of large companies, are now increasing efficiency and saving money for smaller business owners as well.
CMMS stands for Computerized Maintenance Management System, and CMMS solutions cover the maintenance needs of an operation. For example, a moderately sized farm has to manage and maintain its facilities - such as a barn, pasture fencing, grain or milk storage, etc. It also has to maintain its machinery - such as a milking machine, tractors, machinery for harvesting, etc. Using CMMS software allows the farmer to automate this management.
Other solutions, such as fleet management software programs, are cousins of CMMS software and fulfill some of the same needs. Importantly, all of these software solutions were originally developed for large enterprises that can achieve substantial cost savings by automating the management of their moving parts. In those substantial cost savings, the software developers found a way to make a good profit by building a good solution.
During the 1990s, there was a lot of invested money at play at the top levels of business, and acquisition-based growth became extremely popular. Acquisition-oriented companies bought new units in their core business, but they also diversified in an unprecedented way, creating incredibly complex conglomerates. By the end of the 1990s, software companies owned gold mines, and one of the most iconic movie studios in the US was owned by a French sewage treatment company.
At any time, acquisition creates an easy and direct way for companies with access to capital to expand their market presence. Rather than building a better mousetrap, an acquisition-oriented company just goes out and buys the company that already has the best mousetrap, grabbing their market share along with their product.
One of the problems with acquisitions, however, is management. Before being acquired, the company has a complete management structure, and a new parent company often wants most of the management team to come along with the deal. The parent, then, ends up adding a new layer of management over the top, a setup that is rife with potential problems.
The root of these problems is usually the fact that any time a layer of management is added, the distance between the highest-level executives (with ultimate decision-making power) and the places where business gets done expands. Developers saw correctly that software had the potential to shorten this distance by communicating critical information up the chain of command more efficiently, and the deep pockets of large, diverse companies gave them a good reason to develop that software.
But huge businesses aren't the only ones that can benefit from a fleet management solution or CMMS software. The same principles apply to small businesses, such as the farm, only on a scale that makes them unattractive to software developers. Now these small businesses have the opportunity to benefit from a hand-me-down effect, using software that wouldn't exist if it weren't for the big conglomerates we all complain about.
For more helpful information, I recommend
Connect CMMS.
by: sambolick119
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