Technology can drive you crazy and lose you money

When I speak to small business owners and managers and tell them what I do, I find a common reaction. Technology is driving many people crazy. We are faced with so much of it, it provides us with a lot of functionality and yet most of us are frustrated by it.

there are many people who enjoy the toys and enjoy working with technology and solving the problems that they create. However, most of us want to get the value the technology provides, but are frustrated with what we have to put up with to get it.

Every website that we have to sign in to requires an ID and password. That makes sense from a security perspective/ But the format and structure of these ids and passwords is totally different, and in order to maintain security, we have to memorize them. Who can memorize an unstructured combination of letters, numbers and special characters? And they are different for every site and application. Talk about making life difficult.

Then we can go to the challenges that we have with the way software works. Significant improvements have been made with common functions in most windows applications, in that they mostly look the same and work the same, but what business value came from the restructuring with Vista? We have the same functionality and a totally different format! This forces us to learn all over again and makes us feel stupid!

Then we have the common problems that we encounter from time to time: software failure. Although software is much more reliable today than it was a few years ago (reboot was the most effective instruction), we still get failures. Most of the failures are introduced by the software that's added to your computer. Since we all have a different set of needs, our computers reflect this and we have a different set of software. In a past life, I was a software developer and supported large mainframe systems. We had a comprehensive set of tests that we ran to see how well this software worked together. No small business can aford this today, and even though some large businesses try, they are only partially effective.

So how do we cope? We have to work with computers. We do get some value from them. We have to learn how to manage computers, to minimize the frustrations and focus on the value that they provide.

There are four levels of managing computers:

1. At the foundation level, we want our computers to run effectively, be stable and not cost us lost productivity. Check out the articles at http://www.thevirtualcio.ca/ for some ideas on addressing this issue.
2. At the business level, we want to be sure that we are getting the value from the software that we buy. My article on business process can be a starting point.
3. The real value comes from the data that you collect about your business. This happens when you are getting effective use from your software and you analyze the content of what you have collected. This data is the first place I look when I start to work with a company, and also the one that is the least used.
4. Your technology mindset is the most important. How you approach technology, your frustrations and your actions will determine the value that you get. I found this blog entry on Don't Let Technology Psych You Out! that can help to address this last item.

Unlicensed software a source of system failure?

A recent study by The Harrison Group on behalf of Microsoft has found that mid-market companies that have unlicensed software are more succeptible to system failures than companies that acquire their software through legitimate means.

Their analysis simply reports that this is the case, not explaining why. It also references the growth rates and identifies that the companies buying legitimately tend to grow faster than the others.

In my experience, licensing is simply an element of how Information Technology is managed in a business. For many small businesses, computers are looked at as an expense to be reduced. There is little recognition of the value that it can bring to the company. Under these circumstances a number of things occur. They include:

• Acquiring unlicensed software.
• Using software that is no longer maintained.
• Reacting to software problems after they occur, thereby encountering outages.
• Minimizing the cost of support by attempting to fix it themselves.
• Not using the software as effectively as they could.

All of these issues are symptoms of treating technology as a cost of doing business. Typically, costs are minimized, but there is no recognition that outages can cost money. When systems are down, people are unproductive. This can lead to overtime, customer dissatisfaction and lost sales.

When I am asked to help a company, they often have difficulties that are affecting their business. One of the things that I always look for is how is technology being managed. I usually find a break/fix mentality with an emphasis on mimizing costs. I also usually find that too much money is being spent... on the wrong things. And this affects their business performance. Money is wasted in some areas and restricted in others. Two of the areas where costs are restricted is in the purchase of software and in software maintenance. The result is system failures and lost productivity,

While the study talks about the relationship between unlicensed software and system failure , the real source of the problem is the mindset towards technology. It is considered a necessary cost of doing business rather than a value to the business. In my experience, if the value is recognized, the value increases. The report identifies that this does not nessarily increase the costs.

To see the full report, see http://download.microsoft.com/download/D/C/5/DC503630-3EDD-455D-B155-4FCCA6FCCEA3/TCO%20Global%20Final%20Whitepaper.pdf

More on the Technology mindset

I have been asking this question to see how it is affecting business operations. In the first few interviews, I was looking at people who are uncomfortable with technology, although I saw problems with people who were comfortable with some aspects of technology and tended to overuse the same tool.

Today I spoke to an entrepreneur who was comfortable with technology, but but was frustrated with the time it took to learn new tools. His problem was not the learning process, he enjoyed it. His problem was that during the learning process, he was unproductive. It took far too long to get the job done and when he needed information about his business, his files weren't up-to-date. That means it was affecting his business. His frustration and the time required was bothering him and causing him to delay working with the software.

This brings up a point that happens in every business. When you implement new software, you lose productivity. Much of what we do everyday, we do by remote control. We don't think about it, because it has become routine. This is good, because we are much more productive and effective (try thinking about walking and see how difficult it is).

When we implement new software, we can't do it subconsciously, we have to think about it. We are also often overwhelmed by the sheer functionality of the software. We bought it because it had a lot more functionality than we had before (if not, why did we buy it?). The result is that we become less productive. If we focus on the whole software product (if that's possible), we resist dealing with it (That's why many software projects fail to meet their goal, people revert to the old way).

The solution is to focus. Find those items that are a priority. Spend your time on them and get up-to-speed quickly. Then focus on your next priority. As you do this, you will learn to do these things automatically, your frustrations will go down, and you will become productive much more quickly.

Unfortunately, software suppliers don't help you. Their interest is to "train you". This means turning on the firehose of training. This isn't the way you learn and it doesn't help your business. Focus on your business processes and the software functions that achieve your objectives. If you want more detail, check out my white papers for more information.

If you want to know what happened to my friend an his mindset, we identified three transactions that he needed to focus on. He is going back to get help on those specific transactions, and now recognizes that they will only take a few minutes to handle as part of an assignment. He has scheduled learning periods for himseff to bring him up to speed on the software. This won't impact his business performance, since it isn't being done at critical times. He enjoys the learning and can focus on this during his learning sessions.

More on the Technology mindset

A few days ago, I wrote about "what's your technology mindset?" from two different perspectives: That of the person that was comfortable with technology and one that was not.

This has led me to start asking questions about how people feel about the technology that they use. What is their emotional mindset and is it having an impact on their business? I've come up with a few more reactions.

• "When I need to use technology that I'm not comfortable with, I get anxious and start to stress out. I am reminded of my incompetance."
• "The software that I bought doesn't format my quotes, invoices etc. the right way, so I did it in Excel, because I couldn't figure out how to do it myself and didn't have time to learn."
• "The way I set up my invoices causes my clients confusion and I get calls about it. I can't afford to get someone to fix it right now."

There are two issues at stake here:

1. A feeling of incompetence.
2. A business impact that is not being considered.

Why do some people feel incompetent when it comes to computers? Do you go to a doctor when you get sick? Do you feel that your lack of knowledge of medicine makes you incompetent? Is the general practitioner incompetent when she refers you to a specialist? What makes people think that computers are any different? Is it because you have a personal computer sitting on your desk and you use it every day? Your body is sitting in a chair at your desk every day too and you use it every day.

The Information Technology industry is very broad and there is a need for specialists the same as in medicine. These specialists may see themselves as capable of working in any specialty, but they are not. When they try to be, they create problems for businesses.

If you suffer from this disease, then you need to change your technology mindset. This is the only way to solve the problem. Believe that you know your business, that you know what you need in your business. Find a good technology specialist or generalist that is willing to tell you that he doesn't have the solution to all of your problems, but he knows someone who can solve each one. Get yourslef a business solution to your business problem, not a technology solution to your business problem.

You don't need to be able to solve every problem yourself. You just need to be able to find someone who can............. on your terms.

Tomorrow, I'll talk about the impact of the statements made above on their respective businesses.

What's your technology mindset? Is it helping your business? (part 2)

In my last post, I talked about the impact of the technology mindset, for people who are uncomfortable or are inexperienced with technology. There is an assumption that people who are comfortable or experienced are much more successful.

Technology is a very broad and growing field. It is constantly changing. Because of this constant change, it is impossible for anybody to keep up-to-date on the changes in every field. So we end up with a lot of specialists. The problem with specialists is that they have excellent knowledge in one area. If that's exactly what you need, then that's perfect. Who determines what's needed. In medicine, we have generalists and specialists. The generalist identifies that a particular skillset is needed and makes an appointment with the specialist.

Unfortunately, we have the same need in Information Technology, but we haven't got the same infrastructure. What is the result?

A old quote (I don't know where this comes from) "When all you've got is a hammer, everything looks like a nail", describes the situation perfectly. Many solutions in IT come from the tools that we are already comfortable with. The more knowledgeable a technician is in an area, the better the chance that the solution will be based on that tool. This may or may not be the best thing for their business.

When you start with the tool, often the business need will be skipped. Although the solution should provide some value, and it may look like progress. In most cases, the solution becomes highly complex and can be overkill. You get some of the benefit, possibly at a higher cost, however, the complexity may create new problems.

I worked with one organization that was concerned about the rising costs of PCs. They leased them and replaced them every three years. A sophisticated Excel spreadsheet was used to manage the inventory and leases. When I strated to investigate the issue, I used a Microsoft Access program to analyze the contents of the spreadsheet. I quickly found the problems and helped them to develop simple reporting to help manage the situation. The individual who was managing the assets was experienced with Excel, but wasn't familiar with Access. He didn't look at the overall business need, or the process required to manage the assets. He knew that he could do all the calculations that he needed in Excel.

That "solution" had cost the business $25,000 per month. The cost of the solution was not the problem. The lack of definition of the need was the real issue.

Whether you have experience with computers or not, is not the issue. Information Technology has to be managed. What is needed is management skills, not technical skills.

What's your technology mindset? Is it helping your business? (part 1)

In many assignments, I work with people who have not been successful with some aspect of Information Technology. They are frustrated in trying to get their software to do what they want in their business. They are struggling to improve their business and looking to the software to help them.

In many cases, this takes a long time for them to make a decision to look for help. In some cases, they look for help, but get technicians who only frustrate them even more. More technical solutions, more money, more hardware, more software. None of these address the basic problem that the business owner or manager is looking for.... a solution to a business problem.

That's the normal situation that I encounter. It often takes a lot of time for someone to be ready for help from another approach. I often start from the infrastructure side, (see Infrastructure article), because without it, other value can be lost. However, today I want to focus on the business impact of what an owner will go through.

To start with, there is a business need. The business need may be increased productivity, reduced cost, increased return on existing assets, improved information. Since the business owner is not aware of what can help to achieve that value, they go on a search. There is an assumption that technology can help, but who are you going to ask? Often, they ask their most knowledgeable staff member. If they have outsourced IT support to a supplier, they might ask him. A friend may tell them that they had success with a particular piece of software or a particular supplier, and so they go there.

When they get to their source of information or solution, there is seldom a real focus on their business problem or goal. We are now at the position of justifying the solution that has already been decided on (not by the business owner, based on his goal, but by the solution provider, based on his solution).

The "supplier" may provide the business owner with alternatives (different software products that could do the job). Time is then spent on evaluating the various options. The evaluation is based on the features and benefits of the various products (not on the needs of the business).

During all of this time, the owner is being led by the specialists, based on their agenda (they may want to help, but they don't understand the business), not on the business owners agenda.

In most cases, a lot of time is wasted (months at least, maybe years). During all of this time, the business owner's attention may be diverted from growing the business, or at least is not being helped at improving his business (the goal that started this analysis). And all of the time has been spent in the wrong direction (the techical solution versus the business goal). If a reasonable solution is achieved, then maybe it is OK, but can anybody afford to lose this time? Time is one resource that cannot be recovered.

In a recent assignment, I worked with a company that was growing very rapidly. Because they couldn't manage the volume of work without better tools, they went out and evaluated and installed new software. By the time I got involved, they had spent at least a year and a half evaluating, installing and trying to work with the software. They questioned whether the software was right for them. In my review, I saw that there was nothing wrong with the software. The problem was the lack of focus on the business issues.

Within three months of starting, we had refocused on the business issues and had made major progress on the business goals that they had established.

What did this year and a half cost them in terms of their ability to continue to grow the business? I know that their expenses were much higher than they should have been, their productivity was lower, but what about growth? Could they have increased their business more rapidly? That is something that I can't answer, but I know that profits were lost and time was wasted.

This type of loss is common with assignments that I take on, because owners are getting tired of the frustration and waste that they see. These organizations have a lack of skills with computers and maybe this is understandable. Next time, I'll look at people who are comfortable with technology and see what the results are here.