Showing posts with label SME. Show all posts
Showing posts with label SME. Show all posts

Tuesday, November 11, 2008

Thinking Outside the Box

We have all heard the term "Thinking Outside the Box". We know that it is thinking differently, but how do we do it?

We need to start by what is meant by the box. A box has four walls (and a top and bottom). When we want to store something in the box, we must put it within those four walls. We can't put it outside the box, because then it won't be stored.

Our thinking is limited by the same four walls. Everything we know creates the four walls.

Why is this important? If you are limited by what you know, you can't think outside the box! That's why many inventions come from people who are not focused in the area where they invent. They have a different background (a different box). They think "outside of your box".

What can you do about this? There are many ways, including reading books in fields, taking courses, hiring a coach, talking to suppliers, etc. Having a mentor helps you think about your business and challenges differently. Often you can solve your own problems by having them ask questions. As you try to explain, you come up with the answer.

In my case, I do a lot of reading, I work with different types of businesses and get to learn as I help them. I am also a member of BNI (Business Network International) as well as an Ambassador with BNI. This allows me to visit other chapters. Each week, one of the specialists within the chapter gives a ten minute speech about his/her business. I have been amazed at how much I learned about subjects that I knew nothing about. My learning has not allowed me to be a specialist at these services. It has provided me an insight into problems that I may encounter in my business or in my clients' businesses. When I encounter these problems, I know who to go to. I know someone who specializes in solving or preventing this type of problem.

Have problems that you don't know how to solve? Need to think outside the box? Start to network and find people that can help you do it? It can save your business!

Sunday, November 2, 2008

Are your systems too complex for your staff?

Is your software doing the job that you expected when you bought it? When a small business buys new software, they are usually looking for something that they don't have. They need new tools, improved productivity, reduced cost.

Most software products are built over many years with features and functions added to meet the needs of their customers. Each customer has unique needs. Some features are used by most businesses, but many find little use for most of the features. The larger companies are most likely to use more features. If you look at something as basic as Microsoft Office, how much of it does the average user know and understand. Most people never get beyond Word and Excel. Even then, how much do you Word. In my case, I used Word for over 10 years before I ever needed the Table of Contents function.

What does this mean to a small business? It means that you have a very complex software product. There is too much of it to learn and you don't need most of it anyway! The real question is "Do you know the features and functions that can help you?". If you don't, you are wasting money! You wasted money because you bought more than you needed. You are wasting money because there are functions that could help you be more productive.

This problem is not helped by the fact that software suppliers train you on the basic functions (because most people need them), but they seldom understand the real needs of your business. So they don't train you on functions that may be of the most value, because they don't know.

What does this mean to your business? The complexity can affect you in several ways:
  • Your people are unproductive because they are doing things in an unproductive way (there are simpler ways of accomplishing the same thing).
  • They don't take actions that could be of value because it takes too much time.
  • They don't take actions that would help because they don't even know that it is possible.

How do you solve this problem? The best way is to look at your business processes before you buy software. If you look at your business process, you find what is working and what is not working as well as it could. You can streamline the business process. If automation can help, you can investigate software that can help you solve that business problem. You evaluate the software based on what it will do for your business and how easy it is to implement (not just what your software supplier tells you). When you buy, you won't buy what you don't need and your implementation will go much faster, thereby reaping benefits more quickly.

What if you've already installed? Can you still gain the benefits? You can gain major improvements by reviewing your business processes and how well they are working. Then look for ways to exploit what you already have. You won't save on what you've already invested, but you can still gain major improvements in productivity and quality of service.

Tuesday, September 23, 2008

Security: another of the list of items of concern to business owners

Technology is a wonderful thing. It creates new opportunities to build a global business from your home. All businesses need computers today, most jobs require computers to get things done, and yet many people pass the job of managing computers to junior staff.

It's understandable that business owners don't want to do the drudge work. Unless you get excited by doing a lot of routine activities, managing computers is not exciting work. It also gets in the way of managing your business. You want to get customers, make sales, bring in revenue. Sometimes, it's hard to relate computer activities to managing your business. The most important ones are the routine ones, the ones that we forget, or don't understand the implications.

This list of security related issues affect most small businesses. They affect large ones too, but large businesses have people who focus on this. In a small business, the buck stops at the business owner. It doesn't mean that the business owner has to be involved every day, but has to make decisions on these issues and ensure that somebody is covering it (either staff or a supplier). If not, the risk is loss of data, loss of productivity and in many cases, loss of a business.

Monday, September 8, 2008

10 Reasons your small business needs a technology services provider

I found a blog entry that described these ten reasons and they are excellent points.

There is one issue that isn't mentioned though, and that is your service provider's focus. Many IT service providers to small business take the "break-fix" approach. That means that they wait until you call and fix the problem that you have identified. They have better skills and can fix the problems much more quickly than internal staff, but that is only a very small benefit.

The real issue is that technology can be managed, problems can be prevented. When well managed, the number of service incidents can be reduced, which means that you don't get the interruptions at all. This is where the real benefit is.

Read the 10 reasons

Wednesday, September 3, 2008

An IT project is a business change project

I just read an article by Jed Simms identifying that every project is a change project and should be managed as such.

What does this mean? Many of the business owners that I talk to are not interested in technology and don't want to have to deal with it. They aren't comfortable with it, despite the fact that it surrounds us. The reason is that much of the technology is hard to deal with. Software is developed by software programmers for software programmers. It isn't developed for normal people. So it's not hard to understand why business people don't want to have to deal with it.

The problem lies with the fact that when we change technology, we are changing the business. Our business processes are affected, therefore our daily work is affected. Our business lives are changed (or why did we do it?). We were looking for improvements, we were looking for change. When we change business software or even the underlying technology (like Vista), we are changing our daily activities. We do much of our daily work without thinking about it. When our subconscious takes over, we get much more efficient. However, when faced with change in our daily work, we have to start thinking about it. We have to learn these new ways of doing things. This slows us down tremendously. We become less productive.

In many cases, the change can feel overwhelming. There is so much to learn and we still have our normal work to do. What do we spend our time on? How do we prioritize? Since we can't get our work done in the normal time, we start to get stressed. We often revert to the way we used to do it, or find some other shortcut. These shortcuts are not always useful from the perspective of the new technology or software. This causes numerous problems.

As a business owner, you don't need to focus on this technology. You need to focus on the change in your business. How will your business be changed? What is the most important thing for your staff to learn about this new software? How do you get them to be productive more quickly?

This is what a change project is all about. This is why every business owner needs to be aware of the business impact. This is why any IT project needs to be dealt with as a business change project.

Thursday, August 28, 2008

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.

Wednesday, August 27, 2008

Should you care about SR&ED?

SR&ED (Scientific Research & Experimental Development) is a tax credit program provided by the Canadian Government to help companies improve their competitive position. In a recent discussion with a SR&ED consultant, I found that many of the activities that a company undertakes may qualify for a tax credit. This can help a company to justify their expenditures on advancement.

Information Technology is a necessity for any company to survive today. Since technology is constantly changing, keeping up with technology and increasing the return on investment is also a necessity. This is more than a technologists view, but one of a company improving or maintaining its competitive position.

Most people probably think of SR&ED in terms of research and development projects, but the Income Tax Act defines it more broadly. There is a structured approach to the requirements and sometimes it can be difficult to go back and justify expenditures as SR&ED eligible.

There are three criteria for eligibility:
  1. The project must be undertaken in a systematic manner, following a scientific method and be carried out by qualified personnel.
  2. The business must face a technological uncertainty with regards to the project.
  3. The business conducting the project must seek to advance its technology, even if the advancement may be only incremental.

When I take on an assignment, the company that I work with has normally failed to successfully implement software to upgrade their business performance, which was their goal. On the face of it, they possibly have qualified for criteria 2 &3 above. They obviously faced technological uncertainty, because they failed. They were attempting to advance their technology as they were implementing new software to upgrade business performance. The only criteria that they may not have met is the first one. Was the project undertaken in a systematic manner, following a scientific method and carried out by qualified personnel?

In my experience, these projects did not follow criteria 1. They didn't get qualified personnel to help them because they didn't want to spend the money. They often fail to get the value or business outcomes that they sought because they didn't have the skills. The SR&ED program may be an opportunity to provide a win-win. Since expenses on an a project that follows a systematic method are eligible, the business may hire skilled consultants to help them and get some of those costs back in a tax credit, their success and profitability are improved.

Can a business afford not to invest in getting help to improve their business performance? This is only a preliminary view of the potential for a business to gain twice from SR&ED. As I learn more about the opportunity, I'll provide an update.

Tuesday, August 26, 2008

The 5 factors for a successful software project

In my experience, software projects in small business are successful for a few good reasons, none of which has to do with the software itself. It has to do with the approach of the manager or owner of the business.

The 5 factors are:
  • Attitude
  • Consistency
  • Persistence
  • Support
  • Advice

I've discussed your technology attitude in a number of posts, and this is a critical factor. If you go in with an attitude that you aren't comfortable, you are aiming at failure.

Consistency is the second most important. For those people who have had negative experiences with computers, you may find this hard to believe, but computers are very consistent. They will do the same thing every time and will expect you to do the same. People are much more flexible and can adapt when things change. They don't recognize that St. and Street are the same and a lot of problems are caused by inconsistency of data. The same is true if you change the way you do something.

Persistence is the third key element. I have never seen a software project that goes perfectly and that is often due to our lack of consistency. No matter how frustrating it seems, you have to push on through and solve those problems that you will encounter during implementation. Most of them have simple solutions. The good news is that because of consistency, once they are solved (really solved), they don't return.

Support is a critical element. If you have no experience with installing software to upgrade your business, get someone to help you. An experienced consultant can help you overcome those simple problems that I mentioned. You will save a lot of time and effort and be able to continue to make progress towards your goal. Get somebody who will work with you throughout your implementation, not just react to your problems when you encounter them.

Even better, get some advice before you start. This will allow you to plan more effectively and prevent many of the problems that you are likely to encounter. If you do choose to get advice, look for a supplier who will work with you throughout the project. This means that they will learn more about your business and be in a better position to support you when you need it.

Notice that none of these factors involve either the software or your technical skills.

A long time ago, a mentor told me that there are three factors for success: focus, will and capability; capability is the least important. If you maintain focus and have the will to continue, you will develop the skills or capabilities that you need.

Saturday, August 23, 2008

The cost of cheap services

To quote Albert Einstein, "Sometimes one pays the most for the things one gets for nothing".

In my discussions with small business owners and not-for-profit organizations, I often hear the phrase "that costs too much". I see business owners going for the cheapest service that they can get. I see not-for-profit organizations getting volunteers to provide support for critical services. In both these cases, the cost of getting free or cheap services is often poor performance or a a poor result.

Obviously nobody should be spending more money than should for service, but what should they be spending?
I recently asked for professional help to develop a brochure. Instead of going for somebody that "I could afford", I went with experience. Two things happenned: One, I got a much better quality brochure; Two, I learned a lot about grphics and developing brochures. I will be smarter next time around.

The same is tru of support for computers. When you go with "Your nephew" or "your neighbour's son", you are unlikely to get the kind of skills that you want. You will most likely get someone who is comfortable fixing computers. But, fixing computers is not why you are in business. You are in business to deliver services to your customers and being paid. If your computers aren't helping you do that, or require constant maintenance, you aren't going to be productive. The cost of the productivity loss may be much more than the cheap support that you are getting. You may not have enough time or information to focus on new sales, or even worse, you will lose sales.

Not all junior people are poor solutions, just like not all suppliers provide good service for your business. However, if you set the standard expectation for how you want your computers and business software to operate, you will have a better quality, more reliable service, and this will help you to focus on growing your business.

Start by focusing on your business goals, and what you must have in terms of functionality and service in order to achieve them. Then look at the cost of getting that service. You may have to compromise, if you don't currently have the money, but at least you will know what you are missing and what you have to do when you have the money.

Thursday, August 21, 2008

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.

Monday, August 18, 2008

IT Project failure

Over the years, many studies have been done, looking at the success rates for IT projects. All of the traditional issues are always raised, and they often are categorized as some of the following, as it was on this Blog "12 early warning signs of IT failure". The list includes:
  1. Lack of top management support
  2. Weak project manager
  3. No stakeholder involvement and/or participation
  4. Weak commitment of project team
  5. Team members lack requisite knowledge and/or skills
  6. Subject matter experts are over-scheduled
  7. Lack of documented requirements and/or success criteria
  8. No change control process (change management)
  9. Ineffective schedule planning and/or management
  10. Communication breakdown among stakeholders
  11. Resources assigned to a higher priority project
  12. No business case for the project
While these may all be valid, there is one underlying issue that is not mentioned. One of the first things that I was taught in problem solving ( a basic introduction to any computer course is "root cause analysis"). Root cause analysis says that you shouldn't look at the first level of causes to understand why something is happenning, but look a few levels down to the underlying causes of these causes. This is also a standard quality management practice.

When we look at some of the above-mentioned causes, we find:
  • Lack of top management support
  • No stakeholder involvement and/or participation
  • Weak commitment of project team
  • Subject matter experts are over-scheduled
  • Lack of documented requirements and/or success criteria
  • Communication breakdown among stakeholders
  • Resources assigned to a higher priority project
  • No business case for the project

All of these related to the fact that this was not something of value to the business. If top management and the business units don't want it, these things will happen. So why do projects get started, and why is time and money spent on them?

Projects get started for good business reasons, but quickly get into "project mode". They cease being a business need and become an IT project. The project team starts talking about implementing software instead of upgrading business performance. Time stretches out as we build a sophisticated system to provide all options that might be requested at some time in the future (it never comes). Let's get back to basics and focus on the business outcomes that the business needs. By focusing on those business outcomes, that should deliver benefits to the business, we will not only have more successful projects, they will deliver the value and keep the interest of top management and the stakeholders.

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.

Saturday, August 16, 2008

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.

Thursday, August 14, 2008

Stage 3 - Managing IT for the non-technical manager - Business Information

Many business owners are frustrated that their computers don't just run. Everybody tells them that they need to become more technical. Everybody that tells you that is wrong. You don't need to be more technical. You need to understand how to manage Information Technology so that it supports your business.

The third priority is to look for information that can help you manage your business more effectively. Once your technical infrastructure is stable, and you have all of your transactional activity being captured (This is the result of stage 2, if done properly), you have a large amount of data about your business.

I am always facinated by the amount of data that is available about a business that is not being used. Numerous times, I have gone in to help an organization and asked for electronic copies of data from their systems, that I can analyze. Even though the quality of the data is suspect, the data is incomplete, it gives me an understanding of the business, that often is different from people's assumptions. It allows me to question what's really happening. The problem is that the business managers are not getting this summarized information. They are getting too much detail. They can't see the forest for the trees..

Most systems that are implemented are focused on the transaction process. This is necessary, because if the transactions about the business are not captured, you can run the business effectively. However, this is only the starting point. Once this data is captured, you have an opportunity.

  • What is really happening? What are your business volumes?
  • Who are your best customers? Are they just large volumes? Are they really profitable?
  • Is some part of your business costing you money, but getting hidden by revenues?

Once you have data, you can analyze it. If you are too busy keeping systems operational, you won't look at these opportunities (getting past stage 1). If you can get your business software to capture and process the transactions in your business (getting past stage 2), you won't have the data. If your technology mindset is that computers are something you have to survive, you won't be looking for these opportunities.

Technology mindsets are the limiting factors that prevent you from achieving the value that is available for you, if you are loking for it.

Tuesday, August 12, 2008

Stage 2 - Managing IT for the non-technical manager - Business Software

Many business owners are frustrated that their computers don't just run. Everybody tells them that they need to become more technical. Everybody that tells you that is wrong. You don't need to be more technical. You need to understand how to manage Information Technology so that it supports your business.

The second priority for managing Information Technology is to focus on your business activities or business process. These are the activities that you do day-to-day to run your business. It includes everything from giving quotes, taking orders, delivering the product or service, invoicing and payment. These activities may not be the reason why you started your business, but your business can't survive without them.

When you buy software, these activities that you most frequently are targetting. And this is the area where many business owners struggle to get value from their investments. Lack of comfort with technology, lack of understanding of the software, complexity, lack of information are often quoted as issues when projects fail to achieve results. The problem is that most business owners don't spend much time here. This is not their core business, their core skills.

Software comes with a built in set of processes for these activities. Although most have special features dedicated to the specific area or category of business, these areas are somewhat the same. The special features are also the ones that are marketed. When software products are evaluated, they are mostly evaluated on these special features. If, as a business owner, you don't focus on your business processes, you can't assess whether the software product will meet your needs. This definition of "requirements" is often a major cause of project failure.

The e-myth, a book by Michael Gerber describes the situation and problem facing most entrepreneurs as they evolve from Technician, to Manager, then to Entrepreneur. The business process is the step in managing your business effectively. It is also the foundation for the successful implementation of business software.

The next stage is the where the real business value comes from. The first two stages are setting things up for the third.

Monday, August 11, 2008

Stage 1 - Managing IT for the non-technical manager - Basic Infrastructure

Many business owners are frustrated that their computers don't just run. Everybody tells them that they need to become more technical. Everybody that tells you that is wrong. You don't need to be more technical. You need to understand how to manage Information Technology so that it supports your business.

The first stage of managing IT is the basic infrastructure. Before getting any value from IT, you have to buy hardware and software. This doesn't do anything for you except give you access to tools that will help you run your business. Managing IT at this level means that it has to work.

Those who are uncomfortable with technology, or just don't want to spend their time there, tend to ignore it, or "delegate" it to some junior technician in their business. Typically this person is technical, is comfortable with playing in technology and will find a way to fix problems that come up.

What they won't do is manage the reliability of the technology, because they don't have the experience to do that. You will get a reactive situation. Problems will occur, and your staff will be unproductive during those times. The bigger problem will be that you don't know what is lurking. Since the technology is not being managed, you won't see a problem until it occurs. Then it will likely have a significant impact on your business. A client of mine recently experienced a 3 day outage due to a minor problem with the server. It took 3 days to diagnose and fix. During that time, their activity didn't stop, but the business processes did. They couldn't invoice and it took weeks to catch up.

Trying to hire someone to support IT in your business is a real challenge. You can't pay high salaries, so you get a junior person. Hiring a senior at a high salary doesn't work either. They just get bored and leave.

Contracting with an outside supplier seems to be a good solution. If you "delegate" the support to the outside supplier, you may be somewhat better off. You no longer have to worry about hiring, training, etc. But if that's all you do, you will not gain much benefit unless your supplier is managing IT for you and not just reacting the way that your staff did. And unless you have defined the goals that they are managing to, you still may be subject to failures that could have been prevented. (the client mentioned earlier had outsourced IT support).

You need to set goals for your supplier, that leaves you in control, but lets them manage the support on a day-to-day basis. Each business will have a unique set of targets, but the goals will fall into the following categories:
  1. Asset management: What hardware, software and other components do you have? What did they cost you? Are they up-to-date? Are they properly licensed? Upgrades are often required to software. Some of these drive hardware upgrades. If you have this available, it will cost you less to get an assessment of future upgrades and may also prevent problems, or ease recovery from major problems.
  2. Risk management: This includes anti-virus, security, non-business use. This area is the source of many problems. If managed properly, you can prevent problems from occurring, or at least identify them more quickly, speeding up recovery.
  3. Backup management: Do you have backup? Does it work? How would you recover from a failure? Many businesses have difficulty focusing in this area, because of day-to-day pressures. You can define the needs once and have your supplier commit to this area on a day-to-day basis.
  4. Reliability management: Do you track service incidents? Does your supplier? What is the business impact? What can be done to prevent these incidents? An analysis of these inciedents will identify actions that should be taken in one of the other areas.
Setting up these management processes, a one time event, will mean that what you spend on software to run your business will have the opportunity to provide the return on investment that you were looking for.

It will also reduce your frustrations, and provide you with the feeling that you are in control, not just subject to the whims of computers or computer technicians.

This first stage is the foundation. If your technology infrastructure is not stable, the only thing taht you will accomplish by putting in more software is to increase your frustrations and opportunity to be affected by failures.

Sunday, August 10, 2008

Three elements of IT for small business

Many small business owners that I talk to are frustrated with information technology. They don't understand it, aren't happy with what they are getting and aren't interested in becoming more "technology knowledgeable". The response from most technology people is that they need to be to run a business. They don't need to become technicians, but they do need to understand how to manage technology because their business depends on it. They need to manage it the same way that they manage all other aspects of their business. They need to make it work for them.

In many cases, technology is seen as a jumble, with no difference between the various aspects. If you don't understand it, can't fix it yourself, you lose.

There are three elements and how a small business owner deals with it and the skills that are required are very different. The three elements are:
  1. Base infrastructure: the roads, the bridges and the technology that the software runs on.
  2. Business software: the component that helps you run your business.
  3. Information: What you need to manage your business.

Over the next fews days, I'll be describing each of these elements, their importance and the skills necessary for a business owner to get results from It, without becoming a technical expert.

Friday, August 8, 2008

The first priority for IT

Most businesses look to technology to solve a business problem. After all, why buy software if it doesn't do that?

But if the infrastructure (IT highways, bridges, etc.) are not stable and capable of supporting the new functions, failure is often the result. This shows up as increased costs, poor response time, delayed projects, etc.

When you build a new building, you have to ensure that the foundation will support the structure that you are building. A shed needs less of a foundation than a house; a house needs less that a tower.

Your business software has the same kinds of needs. Unfortunately, many software suppliers or even outsourcing IT suppliers won't tell you this. They may be afraid to lose the contract if the cost is too high. They may not understand the needs of the software. Most software suppliers tell you the minimum that is needed to run their software. That doesn't mean that it will run well. This minimum doesn't consider your other needs. It is an isolated view.

These are some of the reasons why costs escalate. The needs were there, but nobody looked at it, or they didn't understand it, or they were afraid to mention it until it was obvious it was necessary. This happens with internal staff as well as external suppliers.

Most small businesses look at the cost side of the equation and don't want to spend more than they have to. This is understandable. It is also a mistake.

Check out my article on "The cost of Buying Business software".

Wednesday, July 30, 2008

Business Value - the Silver Bullet

A detailed study of project success performed in Australia provided another perspective on the failure rate of projects (this went beyond IT projects). A very small percentage of project succeeded in delivering business goals. They failed, not because of poor project management, nor technical difficulty, but because they never defined the business value that was to be delivered.

The projects got initiated with a fuzzy definition of what was to be delivered. It was assumed that by completing the implementation that business benefits would be delivered, but nobody was focused on this. They were focused on the implementation. However, implementation of software delivers a small portion of the benefits, and unless the full business value is identified, success will never be achieved.

I have seen many projects initiated with an attempt to provide "justification". This justification always seemed to focus on identifiable financial benefits, and not on the business value generated. For example, improved productivity was only measured if staffing could be reduced. In addition, this lack of identification of business value leaves a lot of benefit on the table.

I recently completed a project where one of the business goals was to be able to invoice within three days of completion of a job. Within three months, we had achieved that objective and that benefit alone paid for not only my contract fees, but for the original purchase and install of all of the hardware and software. The previous project had been to install the software. While implementation of the software had been completed, the business never saw the value until we focused clearly on these goals.

Why is it that so few projects focus on business value? In my experience, most software projects take on a life of their own, once they are initiated. Many compromises later, the project is completed and there is no way to measure its success. We can measure it one way; the business people are always disappointed. Their expectations (not written down) were not met. A focus on business value would eliminate that problem.

Tuesday, July 29, 2008

Is Planning necessary?

I had a discussion with a client recently who said that her approach to doing things had changed significantly since we started working together.

She is a very action oriented person and typically starts off in a rush in order to accomplish her objective. She now starts by planning what she wants to do before starting any action. She has recognized how it saves time in the long run.

I recently found a statement describing how 1 hour of planning saves 3 hours of execution.

In starting any project, everybody is looking for action, and planning does not look like action. Managers want immediate results. Unfortunately, this focus on immediate results often causes more problems. Unnecessary work gets done, the wrong function is delivered.

I always look to the business goal that we are trying to achieve and what we need to do to achieve it. In looking at a project this way, questions get asked and the answers change the definition of the problems. People are separated by a common language. What you say and mean may be different from what I understand. If I don't attempt to outline a plan for what you are asking for, I really don't understand what is involved. If I start acting on it, it may look like I'm on the right track, but I could be way off base. By developing a plan, I get a better understanding of what you are asking for and when I communicate this to you, you can tell if I'm delivering what you want.

If business people are separated by a common language, what do you think will happen with technology people? They have a language all their own and their focus is very different. What they hear you say is very seldom what you mean. Without the outline of a plan, you will not get what you think you are asking for.