Firms see link between innovation and technology

In the small town of Mount Brydges, Ont. (pop. 1,000), Hollandia Bakeries Ltd. has grown from a tiny corner bakery into a thriving large-scale production plant. Covering 35,000 sq. ft., the plant is capable of producing 3,500 pounds of cookies each hour and up to one and a half million cookies each day

Even the cookie business is becoming more dependent on IT. “Growth will come from knowing what the customer wants,” said Rick Bannister, Hollandia’s controller. And IT can help mid-sized firms by providing better, faster and more reliable analysis of data, he said.

For Canadian mid-sized companies that supply everything from cookies to auto parts to accounting systems, we found a surprising commonality of concerns when it comes to IT.

And on the next couple of pages, you will see the results of a Computing Canada “Five on Five” online survey aimed at probing the use of IT among mid-sized firms. We asked five questions in total and selected what we felt were the five responses that best represented typical concerns. We also asked these companies if they thought there was a link between innovation and IT, and the overwhelming response was absolutely yes.

Indeed, many respondents said IT can be applied to virtually every part of their business whether it’s new product development, evaluating new markets, finding customers or increasing productivity on the plant floor.

Some other key findings are:
1. The use of outsourcing is minimal and innovation comes from within. Most of the companies in our survey do not outsource at all, and those that do, do so to keep up-to-date rather than assist with day-to-day operations.
“We outsource only when no internal experts are available,” said Paul Nisotolis, an application developer with privately held auto parts supplier Multimatic. This approach seems to be working: earlier this year, the company was named General Motors supplier of the year for its overall business performance.

2. The value of IT comes from efficiencies gained in business processes and the ability to measure customer satisfaction. Peter Burns, director of information services for High Liner Foods in Lunenburg, N.S., said he looks for success in business improvement projects although this can sometimes be hard to measure – that’s where upper management and peer recognition come in. Last fall, the company won the Canadian Institute of Chartered Accountants (CICA) 2005 Corporate Reporting Award in the Small Cap and Venture category.

3. Collecting data about customers can be an obstacle. Case in point is Hollandia Bakeries. It’s not just the premises and equipment that has changed; the bakery is evolving from traditional baking styles imported from the Netherlands to highly specialized home-style cookies baked in Canada. Tracking where the market is going can be tricky. “As for data analysis, I have only spreadsheets and my own professional training as tools, although I am looking into other systems that would provide more data,” said Bannister.

4. Mid-sized firms are not averse to risk in IT. In fact, that’s what makes us unique, said Nicole Mitenko, manager of technology for KMSS, a Calgary-based accounting firm. “Risk-taking comes through trial and error and has placed the firm in a mindset of growth strategy and progress.”

5. There is still an overwhelming preference for packaged solutions. “Packaged solutions are easier on the mind and on the budget,” said one respondent. “We are not in the business of developing software,” said another. “We prefer packages that are integrated with existing systems.”

To read the responses from our online survey click on the links below:
Peter Burns| Rick Bannister | Nicole Mitenko | Paul Nitsotolis | Mireille Rondeau

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Jim Love, Chief Content Officer, IT World Canada

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