In this interview, we delve into the expertise of Lynda Roth, a professional known for assisting mid-market companies in leveraging technology to thrive in the 21st-century economy. Lynda sheds light on the challenges these companies face when determining their information technology needs and integrating suitable systems. She emphasizes the importance of streamlining operations through technology, fostering interconnectivity with customers and suppliers, and dispels common myths surrounding the availability and affordability of technology solutions. With her extensive background in small and mid-sized businesses, she brings a unique perspective to the table, offering insights into the key criteria for evaluating back-office systems and highlighting the pitfalls to avoid during implementation. Through her guidance, Lynda empowers mid-market companies to become digitally driven, interconnected businesses poised for success in the modern era.
What types of companies do you work with, and how do you assist them?
I primarily work with mid-market companies, typically ranging from 50 million to a billion in revenue. Some of these businesses have even surpassed the billion-dollar mark, while others are smaller, such as the marketing company I’m currently assisting with revenue of just under 40 million. Despite the range, these companies often struggle with determining their information technology needs and integrating them effectively.
In a recent client engagement, the owner expressed the desire for new systems but had budget constraints that limited their options. However, I assured them that suitable solutions were available. My role was to help them identify the right technologies and guide them through the implementation process.
My main objective is to assist these companies in transforming into 21st-century businesses by leveraging technology. Regardless of the industry they belong to, embracing digital operations is essential for their profitability and growth. I often refer to it as “surviving and thriving in the 21st-century economy.” To illustrate this, I draw parallels with the transformative technological advancements of the late 19th and 20th centuries, such as the telephone, electricity, and the light bulb, which revolutionized industries. During that time, small shops and craftsmen gave way to large companies that eventually became industry giants.
Similarly, in the 21st century, digital technologies emerged in the 1990s. Initially, businesses primarily used them internally for tasks like accounting. The Internet has revolutionized the landscape of business operations, enabling businesses to connect and interact in unprecedented ways, and it is surprising how many businesses are still operating with outdated technology and not taking advantage of cloud-based systems to operate more efficiently.
Returning to the example of my client in the food and nutraceutical chemicals industry, their core production remains the same. However, instead of relying on spreadsheets and manual processes to manage production schedules and customer interactions, they can now leverage advanced technology to become an interconnected and streamlined enterprise.
How do you assist them in streamlining their operations using technology?
My role involves helping businesses streamline their operations by utilizing technology to enhance communication with suppliers and customers. Take the procurement process, for instance. Traditionally, businesses have dedicated procurement departments that handle tasks like purchase orders and supplier selection using manual processes. However, these tasks can now be streamlined through digital means.
I recall a case where a potential client, who manufactured small dishes for frozen food dinners, initially dismissed my suggestions as impractical. He expressed frustration with receiving frequent rush orders from the food companies he supplied. I explained to him that his inventory, which consisted of the products provided to the food manufacturers, was considered a “sea level” inventory. This meant that it wasn’t regularly monitored by the manufacturers, leading to last-minute rush orders when they realized they lacked specific dishes needed for their food products.
To address this challenge, I proposed integrating his business with the food manufacturers’ enterprise resource planning (ERP) systems. By connecting with their ERP systems, he would gain visibility into their manufacturing schedules, enabling him to anticipate their needs and proactively produce the required dishes aligned with their production plans.
What are the main challenges companies face when researching new systems?
When it comes to researching new systems, many mid-market companies encounter significant challenges. The executives and owners of these companies understand the importance of upgrading their systems, but they often struggle with the high costs associated with well-known brands like Oracle, SAP, or Microsoft Dynamics, which dominate the market. This creates a dilemma because software companies targeting the mid-market segment face difficulties in gaining visibility and recognition compared to larger vendors.
One of my key roles is to present alternative options that can help these companies save money on software systems. This involves not only reducing immediate costs but also considering the long-term expenses associated with system upgrades and digital transformation.
I remember working with a metal distributor in California that faced a similar situation. Despite generating significant revenue, they were still using an outdated 1980s system. Their small IT department focused primarily on day-to-day operations and lacked the knowledge of the company’s true system needs and where to find appropriate solutions. When CEOs and decision-makers in such situations start researching new systems, they often encounter an overwhelming amount of information about expensive options like Oracle, SAP, and Microsoft Dynamics. The price tags associated with these systems often reach tens of millions, leading companies to believe that there are no other viable alternatives available.
However, there is a market segment of mid-market systems that offer suitable solutions. It surprises me that these mid-market systems have not invested more in promoting their offerings to increase awareness. Nevertheless, my career revolves around familiarizing myself with these systems, building relationships with reliable vendors, and connecting them with companies that express the need for systems but have concerns about affordability. Unlike large consulting firms, I offer a distinct advantage by presenting alternatives beyond the big-name software systems often recommended by major accounting or consulting firms.
How do you assist companies in overcoming challenges during the implementation of more efficient systems?
To help companies implement more efficient systems, one crucial aspect is emphasizing the significance of interconnectivity with their customers and suppliers. I explain the value of integrating with their customers’ ERP systems, which grants visibility into manufacturing schedules. This enables proactive preparation and readiness for orders, eliminating the need for last-minute rush orders. However, smaller manufacturers often face challenges when their products constitute only a small part of a larger organization’s production needs. The larger organization may not always consider the manufacturing and shipping requirements of the smaller manufacturer.
In today’s digital age, manual processes like clerks filling out online forms, printing them, or sending them via email are unnecessary. Instead, we focus on implementing systems that facilitate seamless information flow. For example, in the case of the food manufacturer and the company producing small dishes, integration plays a vital role. The smaller dish-making company can establish integration with the food manufacturer’s ERP system, receiving notifications when orders are placed. This integration process requires careful planning and assistance, which is where I step in to help identify suitable solutions and integration providers.
It’s important to clarify that when I mention “manual” processes, I refer to the fact that individuals still have to input information by typing on a computer. While physical paper usage may be eliminated, the essence of manual processes remains. Therefore, transitioning from physical mail to email represents a significant step towards digitization and streamlining operations.
What are some common myths and misconceptions about your work?
There are a couple of prevalent myths and misconceptions surrounding my work with mid-market companies. Firstly, many executives and owners of these companies are often unaware of the available technology solutions and how to find them. They may believe that only large, well-known software brands are viable options, unaware of the mid-market systems that can effectively meet their needs at a more affordable cost.
Secondly, there is a misconception related to the partnership between mid-market companies and larger corporations like Walmart and Amazon. These retail giants collaborate with numerous small manufacturers that supply products for their shelves. However, these companies have strict processes and requirements that must be followed for inventory to be stocked in their stores. Walmart, for example, has implemented automated processes to manage its supply chain. If a smaller business is not integrated into Walmart’s automated process, its inventory will not make it onto Walmart’s shelves.
In my perspective, being a 21st-century business means being an interconnected business, establishing seamless communication and collaboration with both customers and suppliers. This interconnectedness is crucial for companies to thrive in the digital age and remain competitive.
What are some common mistakes made by mid-market companies when integrating their business systems?
There are several common mistakes that mid-market companies often make when integrating their business systems. Firstly, some companies tend to give up too easily, assuming that there are no suitable solutions available for their needs. This misconception can hinder their progress in finding the right system that can effectively streamline their operations.
Secondly, some companies make the mistake of choosing larger, complex systems that are not a good fit for their organization. These systems often come with high costs, not only in terms of the initial investment but also in ongoing expenses. Working with big consulting firms can further escalate costs, as they often charge high hourly rates for consultants who may not fully grasp the intricacies and specific requirements of mid-market businesses.
Additionally, when larger consulting firms send junior staff to mid-market companies, there can be a disconnect between their theoretical knowledge and the practical realities of running a business. These junior consultants may approach the integration process with a one-size-fits-all mentality, relying solely on frameworks learned in their MBA programs. However, this approach may not align with the unique needs and operations of mid-market companies.
In my case, I bring a valuable perspective to the table as someone with a small business background. Growing up, my father owned an HVAC system company, and I gained hands-on experience working in the office from a young age. This firsthand experience has given me insights into the workings of small and mid-sized businesses. Although I have also worked in larger corporations such as Ralston Purina and Levi Strauss, I understand the specific needs and challenges faced by mid-market companies.
What are the key criteria for corporations to evaluate back-office systems in order to improve operations?
When evaluating back-office systems to improve operations, there are several important criteria that corporations should consider. First and foremost, the system should be built on an open architecture platform, allowing for easy integration with other systems within the company. This means it should not be a closed platform that restricts connectivity and interoperability.
An effective back-office system should be browser-based, utilizing internet capabilities and programming languages that enable seamless integration. This facilitates efficient communication and data sharing between systems, promoting connectivity with customers and suppliers. The focus should be on being an interconnected business, where systems can communicate without manual interventions such as sending emails or relying on spreadsheets.
Moreover, it is crucial to assess the system’s ability to streamline processes, automate tasks, and enhance overall operational efficiency. The system should support essential functionalities such as financial management, procurement, inventory management, reporting, and analytics. It should also offer scalability to accommodate business growth and adapt to changing needs over time.
During the evaluation process, integration capabilities, user-friendly interfaces, data security measures, and robust support and maintenance services should be considered. The system should align with the specific requirements and objectives of the corporation, providing a comprehensive and flexible solution that enhances operational effectiveness.
How can we find more information about you?
To find more information about me and my work, you can visit my website at ljrcs.com. The website provides comprehensive details about my background and the services offered by LJR Consulting Services.
If you prefer direct communication, you can reach me by phone at 818-216-7264. I’m always available to answer calls and provide assistance. Alternatively, you can send me an email at firstname.lastname@example.org for any inquiries or further communication.
Please feel free to explore my website or contact me directly for more information or if you have any specific questions.
Jeremy Baker is an Author and contributor to Small Business Trendsetters and Business Innovators Magazine, covering Influencers, Innovators and Trendsetters in Business, Health, Finance and Personal Development.