Reference Date: 2005-02-01 http://www.iabusnet.org/templates/main/articleprint.cfm?ID=178
Presented to you by the Iowa Business Network Converting to the Metric System U.S. Small Business Administration The U.S. government's decision to mandate the metric system as the preferred system of weights and measures for procurement contracts will have far reaching implications for the business community. Metrication will have an impact on both product-oriented and service-oriented firms. For example, a retail business currently selling fabric in units of inches and yards will, after conversion, sell fabric in centimetres and metres. Similarly, a janitorial firm wanting cleaning contracts will bid on office space based on specifications for square and cubic meters. Metrication will create a new business language. Despite new opportunities, some small business owners will resist metrication. You should, however, convert as quickly as possible. Why? The answer is simple. Those among the first to convert will improve competitiveness and market access and achieve standardization savings. Those who are slow to convert will recover little, if any, of their costs. The conversion process is a procedure owners must undergo in order to retain their share of federal contracts. Any small businesses failing to make the transition will not be competitive in metric markets of the future. THE PROCESS Metric conversion is not necessarily a complicated process. But, it will take time and careful planning to make the transition as cost-effective and as efficient as possible. There are a number of steps you can take to simplify the process. First-Cut This is the initial stage in metric conversion, where you perform a quick, rough analysis to determine if conversion is warranted. Questions you should address are: When should you start developing a metric capability? How fast should you phase-in metric capability? What is involved in moving in that direction? Once you have assessed and answered these questions, you are ready to analyse the market to assure yourself there is or will be a large enough market to justify the investment. Also during this stage, prepare a cost analysis for an estimate of the costs and prepare a preliminary phase-in plan to identify when to start implementation. Your analysis should include: Market Analysis Define goals and objectives Check metric products' sales trends (foreign and domestic) Check suppliers, competitors and trade associations for trends Identify types of product conversions and their impact on servicing work Project customary vs. metric new business Cost Analysis Add, replace or modify tools and service equipment Add, replace or modify inspection and test equipment When necessary, train employees in metric Maintain, store and handle dual inventories, work to reduce and phase-out non-metric items Revise service order forms and other documents Project total costs for developing metric servicing capability Preliminary Metric Phase-in Decision Review projected sales revenues Consider alternative phase-in plans for cost reductions Evaluate non-cost considerations Make preliminary decision By analysing these factors, you will be able to: Identify new market areas Determine if your market is saturated with small businesses offering similar services Estimate the initial cost Outline a conversion method Planning Next, start your planning. This process usually focuses on four major areas: Demand forecasting Service planning Personnel training Paperwork changes Demand Forecasting Trends in converting products now serviced to metric Potential new metric product service work Sales literature Customer notification Continuing metric market research Service Planning Tools and service equipment Inspection and test equipment Performance and testing specifications Metric supply sources Purchasing specifications Dual inventory facilities procedures Scheduling metric servicing phase-in (lead time requirements) Personnel Training Employee notification Training needs identification Training materials availability (including shop charts) Scheduling training Paperwork Changes Service order forms Testing reports Parts/tools check-out forms Accounting records Scheduling procedural/printing changes By working through the areas described above, you now have a comprehensive, detailed metric servicing plan. But, before you make a final decision, there are two additional cost factors to consider. First, consider whether you will need to borrow money to cover the costs of metrication. Second, consider the tax implications of your metric phase-in plan. With this information you will be able to prepare a fairly accurate cost projection, which can be incorporated into the financial section of your business plan and used to justify investment costs if you apply for a loan. Phase-In Now you are ready to begin the final stage of the metrication process: Phase-In. A usual way to begin this stage is to schedule a meeting in which you affirm your commitment to the metric program. Employee motivation and support can be enhanced by outlining the importance of the program to the future of the company and to job security. Also, keeping employees informed about and identifying their roles in the process will alleviate fears and make the transition smoother. Remember, your employees are a vital key to the success or failure of the conversion process. As your company changes to metric, it is critically important that you keep a continuous check on how closely the conversion process correlates with your plans. Many companies have discovered that the most effective way of accomplishing this is by having frequent meetings of task leaders to review the previous week's experience, and by generating a set of special reports for use by the leaders. The contents of these reports should be tied closely to your phase-in plans. METRIC INFORMATION Excellent sources for further information and assistance on metric conversion and the metric system are available. Make it your business to know what information is available, where to get it, and how to use it. Several sources of information include: American National Metric Council 1735 North Lynn St., Suite 950 Arlington, VA 22209 National Institute of Standards and Technology Office of Metric Programs Gaithersburg, MD 20899 American National Standards 1430 Broadway New York, NY 10018 U.S. Metric Assn., Inc. 10245 Andasol Ave. Northridge, CA 91325 U.S. Small Business Administration 409 Third St. SW Washington, DC 20416 Presented to you by the Iowa Business Network.
