Australian Business Academy

www.ausbusac.edu.au

Executive Summary

The Australian Business Academy was established in 1996 offering tertiary business courses for Australian students with interview-based admission as opposed to focussing on the Universities Admission Index.  The Academy offers courses in Marketing & Management, Information Technology, Sport Management, Travel & Tourism, and Graphic Design.  With campuses in Canberra, ACT, and Parramatta, NSW, the Academy employs eight full time and thirty sessional staff.

Bruce Calder, Managing Director, and Louise Mayo, Marketing Director, drove the Academy's e-commerce initiative from the outset of the organisation. Initially a student database was maintained to record student details.  Due to rapid growth of student admissions, the database was further developed to facilitate better client management and staff productivity.

The Australian Business Academy uses a centralised database that enables the company to track current and potential student details and their requirements, giving them a competitive edge in the market. The Customer Relationship Management (CRM) database lists prospective student contacts, advertising consultant details, work experience and industry contacts, local and interstate schools and universities, and graduate details.

In addition to facilitating more efficient information tracking through the centralisation of information, the database has enabled the automation of manual procedures such as the compilation of lists and contacting groups of people.

Additional revenue attributable to the Academy's e-commerce initiative in 2001 amounted to $346,000. This additional revenue was largely achieved because of the marketing opportunities generated by the website, student satisfaction with the new system, and their subsequent referrals to other students, as well as the use of the CRM as an identification and marketing tool for prospective students. The increase in revenue contributed $41,520 to gross profit and, coupled with cost savings of $227,350, generated a net operating benefit of $229,558 after deducting ongoing expenses of $39,313. The initial investment to establish the system totalled $50,690.

Immediate plans for the Academy include increasing electronic communication with students and also shifting the remaining manual financial transactions to the online system. In the future, the Academy would also like to make use of iris scanning technology to register students and distribute relevant information.

The Business

The Australian Business Academy was established in 1996, offering tertiary business courses for Australian students.  Interview-based admission is used as opposed to focussing on the Universities Admission Index.  Courses in Marketing & Management, Information Technology, Sport Management Travel & Tourism, and Graphic Design are offered. The Academy offers an interactive and proactive environment fostering a dynamic learning experience for all graduates.

With campuses in Canberra, ACT, and Parramatta, New South Wales, the Academy employs eight full time staff.

Getting Started

Bruce Calder, Managing Director, and Louise Mayo, Marketing Director, drove the Academy's e-commerce initiative from establishment of the organisation. Initially a student database was maintained to record student details.  As the Academy's client base grew, the database was further developed to facilitate better client management and to improve staff efficiency.  The Academy operates as a 'personal service business' making it important for the company to understand and respond to student needs. Bruce and Louise found there was a requirement for large volumes of information to be stored and accessible online.

The company also felt that with staff often out of the office and distributed between the two campuses, communication and information sharing would need to be improved to increase the Academy's service quality.  This was addressed through email and other electronic communication media.

The initial e-commerce implementation was assisted by Bruce's own Information Technology expertise and advice sourced from business peers. The Academy's website was launched two years ago with the help of an external web developer and an advertising consultant.  Bruce also used the Internet to research competitors' websites.

All staff have the opportunity to contribute to the e-commerce strategy, although the main responsibility for strategic direction is shared between Bruce, an IT lecturer, and Daniel Worldon, the Course & Marketing Advisor.

Customer Relationship Management

Customer Relationship Management (CRM) refers to the methodologies used by a company to manage its processes in order to enhance customer service. A key aspect of CRM is gathering customer data so that products and services can be strategically aligned with customer needs.

The Australian Business Academy uses a centralised database that enables the company to track student details and their requirements, providing a competitive edge in the market. This CRM database also lists prospective student contacts, advertising consultant details, industry contacts, local and interstate schools and universities, and graduate details.

In addition to facilitating more efficient information tracking through centralisation of information, the database has enabled the automation of manual procedures.  These include the compilation of contact lists and mail-outs.

The marketing value of this resource is in the ability to track the success of different advertising methods. Prospective students are listed with information such as their current school, their enquiries, what advertising they have received, how they discovered the Academy, and how staff have actioned their requests.

A separate database is used to record current student details and their results.

Current e-commerce strategy

With campuses in both Canberra and Parramatta, the Academy uses an Asymmetric Digital Subscriber Line (ADSL) Broadband Internet connection to create a Virtual Private Network (VPN). This technology makes use of Internet protocols and the public telecommunications infrastructure to exchange information securely as if there was a private network. The VPN allows staff at the Parramatta campus to access the central repository in Canberra. The repository contains information such as online manuals with course outlines and guides for lecturers.

The Academy's ADSL Internet connection is also used for administrative functions such as electronic supplier payments, payroll and student payment processing. Materials and equipment such as stationery and projectors are researched and sourced online. Communication and document transmission with advertising consultants is also performed electronically.

The Academy's website is utilised for both advertising and communication with potential clients. It contains mainly brochure style information about the Academy and its courses as well as an enquiry form.  Responses are usually sent via email.  The website is promoted through newspapers, radio, television, billboards, search engines and company stationery. 

Physical and software based security mechanisms have been installed at the Academy. The system is backed up on a daily basis with offsite tape storage.  A firewall and weekly updated anti-virus software protects the company's network from internal and external attacks. All financial information is stored on a stand alone computer to ensure network violations do not risk sensitive business information.

Revenue and Costs

* Note: Capital Expenditure was amortised over a four-year period

Financial Analysis

Additional revenue generated by the Academy's e-commerce initiative in 2001 amounted to $346,000 and contributed $41,520 to gross profit.  Coupled with cost savings of $227,350, it generated a net operating benefit of $229,558 after deducting ongoing costs of $39,313.

Increased communication efficiency contributed a total of $100,000 to cost savings in communication time and telecommunications costs.  The use of email, and streamlined administrative processes saved a further $50,000. Improvements in after sales service, payroll, and marketing saved the company a further $20,500 for the year, and decreased staff travel requirements reduced expenditure by $30,000.  Centralisation of information and remote access by staff negated the need for additional office space ($15,000).

The Academy invested a total of $50,690 in to the e-commerce initiative.   Preliminary research and meetings with consultants cost $3,000 and a further $3,000 was spent on staff training. Web development costs were $7,500 and setting up the ADSL broadband Internet connection was $4,500. The CRM software and VPN system was installed professionally for $4,500 and $5,000 respectively.  Other hardware investments include the backup system ($2,500), envelope feeder for the Rapid Addressing Tool (RAT) ($900) and an additional modem ($200).

Ongoing costs for the new system in 2001 amounted to $39,313. Rental of the three additional phone lines totalled $10,080 for the year.  Costs associated with maintenance of the system include system administration ($6,240) and Internet Service Provider ($1,200). Capital expenditure is amortised over a period of four years at a cost of $12,673 in 2001.

Non-financial Benefits

Once accustomed to the electronic information system, staff have enjoyed improved productivity and communication between campuses is significantly more efficient. Employees have also been satisfied with the Academy's ADSL Internet connection, as it allows them to access information more quickly and easily.

Students also benefit from the integration and centralisation of personal information.  This has enabled them to enrol, receive relevant information, make payments, and obtain results much more efficiently. The Internet has offered marketing opportunities that have also raised the profile of the Academy as a professional educational institution.

Challenges

The main issue faced by the Academy was the initial reluctance of employees to use the new system. Training was identified as a solution to managing user acceptance issues and as a result, the Information Technology (IT) lecturers ran a peer group seminar for the staff.

Future

Immediate plans for the Academy include increasing electronic communication with students and also shifting the remaining manual financial transactions to the online system.

In the future, the Academy would like to register students using an iris scan. This unique identification would then be used to link and transmit results, notify students of class details, and new messages.  In addition to their enhanced security functions, iris scans would increase the efficiency of information dissemination to both students and staff.