Wired For Success

Barriers Come Tumbling Down

Anyone who has invested time or money in technology has a horror story or two to tell. Software wouldn't load correctly, costly equipment had to be replaced six months later because it was already outdated, employees couldn't get a grip on the newfangled system--these are all frustrating side effects of the growing presence of technology in business.

For cost-conscious entrepreneurs, the biggest downside associated with technology is the high price tag. According to KeyCorp's survey, 38 percent of the respondents said cost is a barrier to technological advancement.

"The investment was much heavier than we anticipated," admits Pink Jeep's Wendell, who spent $200,000 in hardware and software upgrades alone over the past two years. "We had to rebudget our long-term expenses and really tighten our belts."

Even so, Wendell, like a growing number of entrepreneurs, understands the value technology brings to a business. "While [small businesses] view cost as a barrier, many are realizing the benefits they can get, and, in certain instances, they're able to [bite the bullet] and pay for it," says Robert Straus, a small-business analyst at IDC/Link, a technology research firm in New York City.

Meanwhile, industry forces have made it easier for entrepreneurs to open their wallets. Prices, particularly for personal computers, have dropped dramatically, while performance has continued to improve. As a result, says Straus, the payoffs have become much more attractive for entrepreneurs than in years past.

Another common complaint is difficulty in learning to use the high-tech equipment that's supposed to make life easier. About 23 percent of small-business owners surveyed by KeyCorp said learning to use technology was a major problem. The trend toward "plug and play" features, which promise to considerably reduce setup time and offer more friendly interfaces, has quieted some complaints. However, many say what's really making a difference is the recent wave of small-business computers, servers and software boasting few setup requirements, customized software, and fewer bells and whistles than their corporate counterparts. "Because products are being specifically designed for the [small-business] segment, use is much greater than in the past," says Straus.

The movement toward small-business technology has also aided entrepreneurs in finding the exact technology they need--something that was difficult for about 8 percent of KeyCorp's survey respondents. Also easing the pain is the fact that, for many high-tech buyers, it's not their first time around the technological block. Says Straus, "Because [small businesses] are going through the purchasing cycle for the second or third time, they've gotten a lot smarter in acquiring [technology]."

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This article was originally published in the May 1997 print edition of Entrepreneur with the headline: Wired For Success.

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