Build a better mousetrap, and the world will beat a path to your door. As a business person, you know that anyone who believes this may also be interested in the purchase of a famous New York bridge.
Making a profit from a "mousetrap" requires marketing, financial, accounting and other skills, some of which you may not have. How can any small-business owner possibly have all the skills needed to run a business? There is a solution. Ed Fraughton and others know how to get teams of highly educated consultants to solve business problems for them - free.Ed discovered that free business consulting services are available from local universities through a program called the Small Business Institute. Locally, the University of Utah's College of Business and the Small Business Administration have teamed to create a program that offers student a chance for real business experience and offers local businesses access to skilled problem-solvers.
While the students are willing to take on any problem that a business owner proposes and that is approved by the instructor, they are more successful with some problems than others. One example is Fraughton, the owner of Terrastar, which developes an aviation collision detection system. He enthusiastically described the students' ability to design and conduct surveys. The Terrastar survey produced by the students was published and distributed in aviation regulation circles. Ed was so impressed he hired one of the students to come to work for him.
Another successful example involves a local veterinarian's desire to know how his office's services compared with those of other veterinarians. The resourceful students took a sick cat to several offices and took notes on the difference in services. The students called his clients and asked their opinion about the quality of service. Although the vet had done his own survey earlier, he found the students' results much more useful because the students were seen as neutral third parties and given more honest feedback. The results provoked him to do some deep examination about perceived quality by clients.
The students also tackle management accounting problems with success. The brother of a family owned business described a major business problem that the students identified for him. The two brothers took over a small manufacturing business from their father and continued to run it the way their father had. Unfortunately, the inherited accounting system was limited to getting the books in order for taxes. The brothers were concerned that they didn't know if the firm made a profit from some of their products. All of the sales and expenses were lumped together, and they only scrutinized overall profitability. They believed if they just kept working harder they would make more money.
The students went back through the invoices and were able to identify that one of the three products had lost money each year for the past three years. They demonstrated that unless the price was changed, working harder would result only in greater losses. The brothers changed their bidding on this product, and the students helped set up a simple spreadsheet to eliminate the problem in the future.
The program helps the students as well. A student recently asked for permission to use her experience as the basis for a promotion to demonstrate her ability to work effectively in groups to solve problems. This is a win-win program for everyone involved.
The Small Business Institute program is simple. Small groups of business students are assigned to work on a problem for three months. They work three to four hours each week, maintaining regular contact with the business owner to make sure they are on track. At the end of the period, they make a formal presentation to the business owner and give him written and oral reports on their activities and the results.
If you are interested in participating, contact Steve Grizzell, director of the Small Business Institute at 364-4346, or Roger Nelson, director of Programs in Emerging Business at the University of Utah at 581-7458. You may also contact Jean Fox at the Small Business Administration at 524-6831.
Steve Grizzell has been involved in business development locally and internationally. He is director of accounts receivable and collections at the Utah Technology Finance Corp. and teaches part time at the University of Utah.