What is a technological dead end, and what enterprises does it face? In this article, we will talk about this using the example of technologies that are being applied now. For example, sales technology.
About 10 years ago, a "group of comrades" tried to place an order at one of the woodworking enterprises for the manufacture of wooden Euro pallets in the amount of 20, 000 pieces. The term for which they had to be “knocked together" is 1 month. However ... it was not possible to agree with the enterprise for the most commonplace reason. Their production facilities were not able to “put together” so many Euro pallets from boards in a short time. This happens.
Everyone knows that this or that production is counting on a certain volume ... The volume of production or "output". However, due to the general decline in the level of education, terminological confusion is often observed. For some comrades, the concepts of “production capacity” and “level of technology” are roughly equivalent. Equivalent, as for students of economic universities, the concepts of "derivatives" and "condoms". And such a term as “technological dead end” sounds not only defiant, but also frightening.
What is technology? Technology is a combination of certain knowledge about the methods and means of conducting production processes, for example, metal casting or construction work. As for production, if a lathe is able to process a workpiece with a tolerance of ± 0.2 mm., And it is necessary with a tolerance of ± 0.05 mm, then we can say that this machine is technologically imperfect.
About the technological dead end or “the limit in technology” can be found in R. Foster’s remarkable book, “Upgrading Production: Attackers Win” (Progress Publishing House, 1987). I will give only one quote:
"in order to maintain a competitive position, even leaders will need to improve the technology management process. At the heart of these changes is the need to recognize the limits that their current technological approaches are facing."
In general, we are used to the fact that the word "technology" is more applicable to technology. That was until recently, until the ruling elites realized that social technologies were more marginal, and technical ones seemed to have moved, if not to the third or fourth plan. It's a pity! The USSR was something to be proud of. Take the same Shkas aviation machine gun developed in the mid-thirties with a rate of 1, 800 rounds per minute. This machine gun with a fantastic rate of fire hit Germany in the early days of the war. But despite this, the Germans, the world technological leaders of that time, did not manage to make an analogue, and this machine gun lay until the end of the war in one of Hitler’s offices. Failed to make an analog, because the Germans did not have the technology to produce this formidable and powerful product. Like this!Technological deadlock on the example of sales technology
But we were a little distracted, in this article we will consider slightly different technologies. Technologies that are currently used in business. For example, "sales technology." In fact, there are many business technologies. For example: the technology of warehousing, inventory accounting, the technology of "loading goods" Gazelle "when transporting it to customers, or the technology of" dispensing goods ".
But the sales technology is indicative in itself, and most trading enterprises try to pay special attention to this problem, thereby trying to improve them and “develop” them. How? This is another question, but all the improvements, one way or another, are associated with two main problems:
the first is cost reduction;
the second is an increase in sales.
It is very easy to reduce costs by "cutting" the percentage of payment to the sales agent, but to increase sales ... here it is more difficult. The market is not rubber, as not very knowledgeable people think, and it is unlikely that even the most terry trading agents will be able to sell more than what is being sold in a specific area.
If you look into history, remember the formation of business in my native Rostov-on-Don, then in the distant eighties a new profession appeared - a commercial agent or sales representative. An employee whose primary function was to sell, sell and sell.
Many tried to find themselves in this profession. Attracted by the breadth of activity, prospects for promotion, decent earnings, in most cases tied to sales. Some found their calling, some failed to do so.
If we consider the “evolution” of this profession, we can see with naked eyes that the sales technology itself has gradually changed. At first, it’s a simple employee who is looking for a sale in one way or another. But try running around the city on foot or taking public transport. Further, it is already a sales agent in a car ... But the market is changing, the era of scarcity is giving way to commodity glut. Trading networks are already choosing suppliers for themselves, slowly "bend their fingers", negotiate, knock out more favorable terms for themselves. Impose their own rules of the game. What's happening? The market requires trained professionals, more educated and "trained." With the correct colloquial speech, able to establish contacts ... In general, the third box in the above diagram.
What happens next? The market is more and more structured and specialized. Another technological breakthrough is equipping a sales agent with a microcomputer. Pleasure is expensive and at that time is not affordable for everyone. But you must admit - this is a new sales technology, which, as far as I know, was first applied to us by one of the tobacco companies.
What happens next? Exactly what should happen according to the laws of system development is the inevitable displacement of a sales agent from the technological chain, namely electronic orders. Do such technologies exist on the Rostov market? Yes, and the volume of electronic orders will grow. Pay attention to the rectangle 5 in the figure below. By making an electronic order, the conditional seller is not spent on fuel and lubricants or on the agent’s salary, thereby significantly reducing costs. And this, first of all, is good for the owners of enterprises!
Does this mean that sales agents will remain out of work? Of course not, but as you noticed, one technology is being replaced by another, and the first and second rectangles are already history. The same technological deadlock that was once reached and which is discussed in our article.
I would like to draw your attention to the fact that sometimes an enterprise in certain technologies comes to a technological dead end and does not notice this.
I will give some more examples:
There is a trading company LLC "On the edge of the abyss" with more than 200 customers, and it does not sell rubber galoshes, but food products and the assortment there is great. A request for supply is accepted by only one employee. The client is trying to get through, and he is constantly busy ... Once the client is trying to get through, another time, and there everything is busy and busy. What to do? There is nothing left but to order the coveted in another, no less worthy organization, for example, LLC “Swamp-South”. But the problem is that from a "technological" point of view, you just need to increase the staff, since in reality 1 person can’t cope .... But an increase in staff is an increase in costs, and the question is: what is more profitable to receive less profit or to increase costs in the form of wages for an enterprise? Of course, there is no definite answer here and there cannot be, but a minimal analysis of this situation could provide an answer to this question.
This is one of the examples that is most directly related to the technological impasse, from which, however, there is a way out. But it also happens when there is simply no way out.For example, there is another trading company LLC “Ovrag Yug”, which has a storage room of 1000 sq.m. The warehouse is packed to capacity and here ... there is also a carriage with food. What should I do? How to be? I need to "solve the problem." then, of course, it will be decided, another thing is how, when and at what cost.
Sometimes we should not forget that any, even the largest warehouse has a “technological dead end”, and it is simply impossible to “shove” more than it physically fits into it. This must be reckoned with. It is necessary to reckon with the fact that each trading agent has its own “technological deadlock”.More than he goes around the shops during working hours with intensive work and traffic jams, where he needs to: see the manager, reconcile, receive or not receive the order (money), documents, he simply will not be able to go around. Everything, point, i.e. dead end.
At the end of the article I want to pay special attention to the following:
any, even a very large enterprise has its own technological dead end.
an enterprise cannot produce, sell, transport, etc. more than its technological capabilities allow, including and sales.
technology is changing. In place of one, come more modern and functional.
new business technology aimed at solving certain problems. In most cases, this is either a decrease in the cost part, or an increase in functionality (performance).
the manager must know the bottlenecks of his enterprise, as well as know his technological capabilities.
Like that…
Allaverdyan Vladimir Vladimirovich,Leading expert at clogicsecure.com.
Investment Advisor. Business analyst. Contact an expert.
(c) www.clogicsecure.com - a portal to business plans and guidelines for starting a small business 08/18/2019