Sam Mallikarjunan of HubSpot can help you prepare your business for inevitable future shake ups.
For sixteen years, Harold Berkman has been building his limousine service on personalized service. No matter what time of day a customer calls Music Express in Los Angeles or New York City, a reservationist comes on the line.
Answering services and message machines have no place in Berkman's operation. And no matter how soon a customer may need a limousine, Music Express will provide one.
"Our personal relationships with our clientele are very special," says Berkman. "We're a service. We don't sell refrigerators and freezers, we sell ourselves."
Because Music Express has established its reputation on personalized customer service, Berkman has stubbornly resisted the notion of automating his offices. "I have always hated computers," he says, "and I didn't want to hear anything about them."
At the same time, however, Music Express employees were becoming inundated trying to process orders and bill customers in the busy offices with only pen and paper.
"We grew to the point where I had a tremendous amount of work to do by hand," says Los Angeles General Manager Fred Ruppert. "There were nights when I would go home carrying a briefcase full of limousine tickets, my log book, and a calculator so I would be ready for payroll."
"Fred spent years telling me we needed a computer," Berkman recalls, "but I was afraid it would hurt our business. I didn't want to lose our personal feel for the business or our close relationships with our customers."
During these discussions, Berkman would typically recite a recent instance in which some unfortunate operator had suffered a computer lapse causing orders to be lost or customers to be stranded. "I'm sure you've heard stories of computers going off line and causing operators to lose a day's worth of reservations. You just can't tolerate things like that to happen in the limousine business," he says.
"My idea was not necessarily to replace our people with a computer system," explains Ruppert, "be cause each reservationist here has a number of clients who want to deal exclusively with that particular per son. But we needed a computer to handle our accounting and billing."
After four years of discussion, Berkman finally agreed to a computer compromise. Music Express would explore a computer system to automate some of its operations, but reservationists would continue to take orders as they always had...with pen and paper. "I couldn't sleep at night if I had to depend on a computer to handle our reservations," says Berkman.
1987 turned out to be the "Year of the Computer" for Music Express. The first step was a three-day question and answer session with Bruce Davidson, President of Information Incorporated in New Jersey.
Davidson came to California to ob serve Music Express in action, and find out what Berkman and Ruppert wanted from a computer system. He discovered that Berkman, in particular, wanted as few changes as possible in the way the company was being run.
Although Information Incorporated has marketed a popular software package for limousine operators for several years, Berkman and Ruppert did not want to make the procedural changes required if they were to use "off the shelf" software. "I felt that if we were going to get a computer, we were not going to get a stock program," says Berkman.
"It might not be necessary to buy customized software for general accounting. General accounting is general accounting," he continues, "but we wanted to specially build a system to meet the, rest of our operating needs. From the first day we spent with Bruce, there was no doubt we would start from scratch. We spent a lot of time telling him every thing that we wanted, down to the nitty gritty."
It became apparent that one of the main goals of the system would be to free Berkman and Ruppert to make sales calls and spend their time more creatively. Another goal was to more efficiently handle payroll, billing, and accounting.
As the list of goals lengthened, Davidson added insights gained from his experience in limousine sys tem development. Several weeks after his return to New Jersey, Davidson was back in California discussing refinements in the system.
"He explained his interpretation of what we had asked for, and there were a number of changes that needed to be made," says Berkman. "What we asked for literally doubled the cost of the software, but it meant that we didn't have to change the way we do things." Fortunately for Music Express, the same program could be used by both the Los Angeles and New York offices.
After establishing objectives for the system, Information Incorporated began several months of programming. During this period, Berkman and Ruppert faced a major decision concerning computer hardware.
"Bruce suggested computers from three different manufacturers, and explained what each of the systems could do. He doesn't sell the hard ware, so he was objectively trying to make it easier for us. We eventually bought the best' of the three systems," says Berkman.
Music Express chose a Northstar computer because of its extensive memory capability, its speed, and its capacity to handle up to twelve work stations. As it turned out, Music Ex press only needed five workstations initially, but has the option of adding seven more in the future. If necessary, the system can also be upgraded to handle a total of thirty workstations.
"This is a 20-year system for us," explains Berkman. "We could have spent less, but we probably would have ended up paying more down the line." One Northstar computer was installed in Los Angeles, and an identical unit has since gone into action at Music Express in New York.
The Los Angeles system went on line last May, some four months after the initial meetings with Bruce Davidson. After several months of testing and de-bugging, the system also went on-line in New York.
During its first two months of computerization, Music Express continued to keep records manually as a back-up in the event of a serious computer problem. "Running parallel," as this is called, is a typical part of the transition into automated business management.
When it appeared that Music Ex press employees were confident operating the new system, Harold Berkman finally gave up his original manual accounting procedures and gave in to the era of automation.
After its first few months of operation, Berkman and Ruppert are pleased with their new Northstar hardware. Roughly the size of a suit case, the computer mainframe sits quietly by a wall in the accounting department.
"Everyone says that computers are obsolete after the first thirty days," says Berkman, "But no other hardware on the market will give me as much as this one will over the next 20 years. This was a very expensive system, but it will give us the capacity to do anything we want to do."
One of the attractive features of the Northstar, according to Ruppert, is that several operators can access a single part of the system menu at the same time. With the Northstar, he says, several people can be as signed to a task, such as billing, without having to wait their turn. Presently, the system is shared by a bookkeeper, a receivables and collections clerk, and two data entry operators.
Berkman and Ruppert are also ex tremely pleased with their custom software. "I'm very proud of our soft ware package," says Berkman.
"Bruce performed some real tricks with it."
To enter an order into the system, the operator simply inputs the customers name, the out time, the in time, the driver's number, and the vehicle's number. The system handles pricing automatically.
"The computer has really made a big difference in our operation," says Ruppert. "It has allowed me to spend much more time with clients and overseeing things. We have only been on the system four weeks now, but I have been able to accomplish as much as I used to in four months.
"It has also helped me understand the business in the present rather than having to wait months for information. This allows me to respond to problems right away instead of finding out about things when it's too late to do anything," he explains.
Another nice feature of the system is that it provides the information needed to respond to customer inquiries such as billing questions. "Now, when a customer questions a bill," says Ruppert, "I can have it on screen within seconds. Being able to quickly verify a bill, means I give out fewer credits than I used to."
To provide assurance of reliability in the event of a power failure, the system was designed to run on a 12-volt power line with a back-up generator. The generator is also linked to telephones, lights, and two- way radios. The back-up system was designed by Bruce Davidson. "We asked for protection from going down, and Bruce gave it to us," says Berkman.
While he is pleased to have achieved a remarkable and unique system, however, Berkman remains something of a computer skeptic.
"With the exception of Fred, we have not really freed up people to go out and generate more business. In fact, we've added people this year but they tell me it's because our business has increased. I am still not really a computer person'."
Berkman and Ruppert agree that it may take another year before the system is fully operational. "The truth is that we didn't think of everything we wanted the system to do, and there are still some things that we want to add to the program," says Berkman.
Another goal is to link the systems in Los Angeles and New York by phone modems so that information can be shared between the two offices.
"We transmit reservations and other types of information by fax machine now," says Ruppert, "but we will be able to do it by computer within a year. We have talked about combining our receivables in one office under a single credit manager, but that can't happen until all the bugs are out of both systems."
Bugs and all...Berkman and Rup pert now feel that the system was an inevitable part of the future at Music Express. "I don't know if I'll ever be completely satisfied with the system," he admits, "but that's probably because I still don't really understand computers." Certainly, the same feeling is shared by many other livery operators.
"Our success forced us into doing this," says Berkman. "It got to the point where we couldn't operate like a Mom & Pop company anymore." Music Express may have advanced into the computer age, but their experience is proving that automation does not necessarily bring less personalized service.
Sam Mallikarjunan of HubSpot can help you prepare your business for inevitable future shake ups.
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