The virtual future - how high technology is helping small business - includes related articles

Nation's Business, May, 1995 by Albert G. Holzinger

The rapid convergence of the information, arts, and entertainment industries can improve management and sales for small firms.

Near the village of Rutherford, at the heart of California's Napa Valley, a majestic redwood barn stands watch over a 35-acre vineyard. The century-old, two-story structure is the centerpiece of Frog's Leap Winery, where the grapes are tended with love-but without chemical fertilizers or pesticides--by the close-knit staff of winery owners John and Julie Williams.

This pastoral setting, the tradition-steeped nature of the winemaking business, and the organic approach to viniculture adopted by the Williams family suggest that the business practices at Frog's Leap are more old-fashioned than the 14-year-old winery's age would indicate.

Nothing, however, could be further from the truth.

While some methods employed by winemaker John are, indeed, thousands of years old, the financial-management, promotion, and sales techniques of marketing director Julie are state-of-the-art.

About half of the 20 employees of Frog's Leap are regular users of the company's personal-computer network and its telecommunications link to the networks of some of the winery's business partners.

Employees use the high-tech tools to perform tasks ranging from accounting to tracking sales of about 50,000 cases of Sauvignon Blanc, Zinfandel, Cabernet Sauvignon, Chardonnay, and Merlot wines "down to the last bottle, to the last retailer, to the last salesperson," says Julie Williams.

Moreover, the Williamses envision using the fast-growing global web of computer networks now known as the Internet to reach customers across the United States, Asia, and Europe.

If all goes as planned, Frog's Leap wine will be available for purchase soon behind an electronic storefront, named Virtual Vineyards by owner-operator Peter Granoff of Los Altos, Calif. This on-line marketplace is located on a graphical subnetwork of the Internet known as the World Wide Web, or the WWW.

The Williamses also may forge a relationship with a local company named Napa Valley Virtual Visit. The firm maintains a WWW database not only of selected area wines and wineries but also of Napa Valley restaurants, lodging facilities, special events, and tourist attractions such as the Frog's Leap barn.

"When we examined the cost of marketing our products and promoting the winery, we felt we needed to look into ethereal areas such as the Internet," explains Julie Williams. 'We can't possibly afford to distribute detailed, printed information about Frog's Leap to our 20,000 customers, but we certainly can afford to put it on line."

Improved management and increased sales are two key benefits that could accrue to the owners of small companies as a result not only of advances in information technology but also the convergence of the communications, information, and entertainment industries.

This consolidation, which could be substantially complete as early as the year 2000, will provide entrepreneurs, their employees, and their customers with affordable access to vast quantities of information in text, audio, video, and other formats.

In the coming years, Americans will be able to mstantaneously receive, display, process, store, and even retransmit the diverse data. They will do so using devices ranging from next-generation wired and cellular telephones, radios, and televisions to advanced fax machines, pagers, desk-top and portable computers, hand-held information appliances known as digital assistants, and high-tech devices still to be invented.

The seamless but devilishly complex web linking the communications instruments will be spun from fiber-optic, copper, coaxial, and other cables and augmented by cellular, satellite, and other wireless-communications signals. The envisioned network is referred to as the national information infrastructure (NII), or the information superhighway.

From the small-business perspective, the potential of this pervasive network of networks and the myriad devices connected to it is immense. The ways in which the futuristic communications scheme may help small companies bridge the resource gap separating them from larger competitors are far too numerous to detail. Here are a few of the most promising:

Mobilizing The Work Force

Many small companies will slash overhead by allowing some or all employees to work at home or in remote locations where costs are low. The far-flung employees will be able to maintain video as well as voice contact with colleagues and customers at the principal business location.

Moreover, emerging wireless-communication devices will enable off-site employees to instantaneously access and update inventory, price, financial, and other computerized business data.

"The work force ... will become infinitely more mobile when people no longer are tethered to wire lines," says Ford C. Greene, chief operating officer of North American Wireless Inc., in Vienna, Va. "Wireless communications will free people to work from a variety of places that are currently impractical, including the beach," he adds.