VARs Can Profit From Recent Changes In Time And Attendance

VARs seeking new markets would do well to turn to time and attendance applications. According to Hamid Shojaee, COO of Vitrix, Inc., there are over 2.4 million small businesses (five to 500 employees) in the United States. Each is a potential customer for a time and attendance system and the market has barely been touched. And as time and attendance technology keeps evolving, it becomes more attractive to these small businesses. It behooves VARs to understand what these changes are and why they are occurring.

What Are The Changes In Time And Attendance Applications?
To determine what these changes are, Business Systems Magazine spoke to two industry manufacturers. Hamid Shojaee is COO of Vitrix, Inc. (Phoenix, AZ), a 13-person labor and management systems integrator with anticipated annual revenues of $3 million. Dave McDonald is president and CEO of New Haven Manufacturing Co., LLC., a 100-year-old company, which manufactures a variety of products. New Haven's Stromberg Division (New Haven, CT) employs about 50 people and specializes in time and attendance hardware and software.

Both men agree the major trend in time and attendance is the switch from DOS-based software to software based on Windows technology. They also agree that customer demand for ease of use and flexibility are the main reasons for the switch. Interestingly, opinions diverge on the importance of biometrics in time and attendance. (Biometric systems verify a person's identity, based on fingerprints, eye patterns, facial images or voice.) McDonald avers that biometrics are the way of the future. He argues for the layering of biometric technologies, such as voice and fingerprint, into one time and attendance system. This layering, he says, will be of increasing importance in fraud prevention and security applications. Shojaee believes biometrics will play a role in time and attendance, but mainly in large manufacturing applications.

What Is Driving Changes In Time And Attendance Technology?
According to McDonald and Shojaee, these changes are being driven by several factors. A major factor is fraud and abuse of the older time clocks and cards. "Buddy punching," whereby one employee punches in for a friend who's running late, is one example of fraud and abuse. Another factor driving the changes is the need for security at many facilities. A good time and attendance system can reduce the need for large numbers of security personnel. Probably the biggest factor driving the changes in time and attendance applications, however, is the fact that new technologies can be selectively added to a system. This means VARs can tailor solutions for companies of any size.

How Can VARs Profit From Changes
Both Shojaee and McDonald agree that opportunities abound for VARs in the time and attendance market. Shojaee recommends that VARs specialize in smaller systems for smaller companies. Some VARs specialize only in high-end time and attendance systems for large companies. These systems start at around $5,000 and margins are good.

VARs who specialize in the aforementioned small businesses, however, should concentrate on smaller, less expensive systems with lower margins. He argues that what they may lose in high margins, they can make up in high volume. McDonald urges VARs to tie in with vendors who develop software so the VARs can be "one-stop shops." He also urges VARs to avoid proprietary systems and to opt, instead, for systems in which components can be mixed and matched. Both McDonald and Shojaee agree that, in the future, time and attendance systems will be more "mix and match" and plug and play. This trend will increase as more open architecture and Windows software are adopted. Eventually, time and attendance systems will be more integrated with accounting and payroll systems. The day may come when time and attendance systems are sold as a complementary product to these systems.