Building Opportunities As Imaging Comes Of Age
Hershey Technologies continues to increase revenue in a mature market by creating customer-centric solutions that bridge efficiency gaps in existing imaging applications.
Those of us who can be referred to as mature know that life is very different from what it was when we were young. We learn that late nights and reckless behavior don't promote personal or professional success, so we've changed our lifestyles to meet those goals. This change isn't a bad thing; it just means that our priorities are different than they once were. Similarly, a maturing imaging market means that VARs have to change the way they approach solutions. Some have opted to verticalize, adopting a cookie-cutter approach that allows them to install a variation of the same solution at a number of different customer sites. That's a valid business model for many, but it isn't always practical in a market where most prospects already have an existing electronic content management solution. Forward-thinking VARs have to find ways to develop solutions that fit the realities of a mature market. Neal Fischer and Sandy LeVine, principals of Hershey Technologies (San Diego), have found that the best way to react to this market is to provide solutions that optimize client IT infrastructure or standards already in place. Fischer estimates that 80% of Hershey's deals have no impact on the back end. His company's specialty has become making existing document management systems and line of business applications even better.
By doing a gap analysis, Fischer determines where there are inefficiencies in an existing business process or system and proves how he can save labor, decrease cycle time, cut costs, and simplify the user experience. "Our strength is to know how to write interfaces," comments Fischer. "The difference between Hershey and other integrators is that we are positioned to make bridges and rapidly establish partnerships with clients. Our position is that we're going to make your system better, not necessarily replace it. We can extend the life of that system, thus increasing the client's return on investment. CFOs and CIOs like that message."
Enhance Your Career By Enhancing Your Customer's Career
It's easier for a VAR to say that they process healthcare claims, for instance, than it is for them to say they build bridges, so Fischer looks for ways to generate business in both commercial and government sectors rather than solely relying on RFPs (requests for proposals) and RFQs (requests for quotes). "We have to get in there before formal requests are generated," states Fischer. "Otherwise, it's reactionary and not implemented to a client's satisfaction because the key criteria often becomes price. When we expose gaps and inefficiencies, we have a key solution in mind and look for the person who makes decisions about quality and service deliveries and show him how he can enhance his department's effectiveness, which ultimately reflects favorably on his career." When Hershey delivers on the promise, that individual becomes an ally who helps spread the word to other departments.
Fischer says that looking at a potential customer's mission statement is a great indicator of how to pitch an idea and is usually readily available on the Web site. In California, for instance, pollution and traffic congestion are important topics for government entities. By showing that an e-forms solution or remote capture addresses these issues, Fischer matches the message to the audience.
"For example, we reviewed a large city's Web site to see what services were offered," says Fischer. "Most programs are overseen by departments which pay their own way. By querying existing services, applications, and online forms, we could see what they had to offer and whether they were under pressure by programs like GPEA [Government Paperwork Elimination Act], HUD [Housing and Urban Development], or the Bureau of Indian Affairs. Departments qualify for additional funding and executive level endorsements to support automation of electronic access to those services."
Often the solution helps a customer save money while increasing efficiencies. If an organization offers an employment application on a non-interactive, image-only PDF (portable document format), for instance, an applicant must still print the form and send it back for scanning or manual data entry. Realizing such an opportunity, Fischer might propose an e-form version of the same application that would be processed similarly if received on paper or via the Web. If a job application takes 6 to 10 minutes to process and dozens are received each day, removing that data entry is a huge savings. Real-time validation of e-forms also prevents errors such as an applicant putting text in a numeric field, further increasing efficiency.
Such a solution might address other, less obvious concerns. In California where traffic and fuel consumption are major issues, reducing the need for citizens to visit a government office appeals to politicians and department heads. Fischer says that in some cases a single e-form can save as many as 500 trips, and the number of forms in most departments represents an ongoing opportunity.
Get Your Developers Out Of The Lab
Once the customer's goals have been defined in terms of time, labor, and resources, Fischer matches them to the skills of his developers. "I'm not formally trained as a software developer, but I understand where the gaps are in an organization," he says. "If I can envision a way to form a bridge, I bring it back to people who are smarter than me and ask 'What if ... ?'"
Nearly half of Fischer's staff is technical, and they spend more time at customer sites than the average programmer does. Because of the kinds of solutions they offer, it's important that the developers be able to visualize real-world applications and recognize customer pain points. Fischer says interaction with customers helps them transfer knowledge to new situations and increases productivity. With just two outside sales reps, Hershey Technologies generates enough business to operate at about 90% capacity with revenues at 15% above last year.
Combat The Myths Of Custom Solutions
In addition to reducing data entry and associated costs, Hershey also focuses on creating applications that simplify the end user experience. "In many agencies, IT training is desirable but costly, and turnover is a real problem. Most interfaces have more features than users need. We minimize options to decrease training time and minimize errors," Fischer adds. Solutions that address efficiency gaps or simplify the end user experience often require custom applications, designed either from the ground up or using SDKs (software developer kits). Overcoming user resistance to "custom" applications is becoming easier, but it is still an issue, according to Fischer. He reviews the trade-offs involved and is flexible enough to recommend and install an off-the-shelf product when necessary.
"Bottom line, a custom application is not that expensive," says Fischer. "And for that relatively low price, I can give a customer exactly what they want and reduce training time." Fischer points to one customer who was using an Oracle financial application. The users could use commercial scanning software and navigate through files and attach them, but the application was prone to human error. "While the volume wasn't overwhelming, I asked them what the cost would be if the wrong file were attached. The application is slated to be distributed to 59 departments at as many as 119 sites," Fischer explains. By developing an auto-attach application, Fischer reduced the labor associated with double-checking attachments while cutting potentially costly mistakes, and he did it at a price that could easily be justified. "If a $9,000 application like that could be used over the course of five years, it might cost the end user as little as 13 cents a day per department," calculates Fischer.
Reduce Dependence On Vendors
Being able to create solutions in-house has helped Hershey maintain a level of independence from vendors. For instance, Hershey used an SDK to create ImageNet, a browser-based, distributed scanning application for the United States Navy, long before any single vendor could complete the necessary research and development. Not only would waiting for a vendor to provide a solution have possibly cost Fischer a very lucrative contract, as an early adopter, he may not have had the fully functional version of the software. "The last thing I want is to be a beta or test site for a vendor," says Fischer.
Fischer is also no stranger to channel conflict with big vendors. He believes the reason his company has fared well against vendors with a dual channel, as well as other integrators, is because it can handle unique and unusual installations. "Some of our competitors are focused purely on applications," says Fischer. "If the job is challenging or creative and requires our core competencies, we'll bury them." Fischer estimates Hershey is "batting about .500" against big companies engaging in direct sales, but Hershey also partners with these companies when the customer opportunity calls for it.
Though some of us dread the changes that come with age, Fischer strives to implement solutions that revitalize mature imaging solutions. "The worst thing I can hear after an installation is 'Things really haven't changed that much,'" he admits. That's because Fischer knows that growing up often requires significant change, and, if you do it right, the rewards are well worth it.