Jake Widman's IT World Canada article  "Six smart ways to grow small business IT" makes a great read for many small businesses who seek and anticipate substantial growth, but seems a little short-sighted in recognizing that not all small businesses want to become big enterprise. Many small business owners enjoy lifestyle businesses for whom the personal service and connection to community comes before the motivation of massive growth of market share. Likewise many non-profits, charities, and organizations have limited ability to grow to regional mandates or basic market limitations.

 

There is certainly some good ideas for all small businesses in Mr. Widman's article, but for those of us who actually work in the trenches and have a commitment to support and serve small businesses, the six basic ideas could be re-worked. I like the six points and note that many of them relate directly to my passion for small business ePortfolio. So here are some summary points and ideas from my perspective.

 

Put IT in your budget: Mr. Widman suggests that small companies are challenged to earmark serious money for IT projects and that their thinking is often driven by current economic conditions. He suggests that Return on Investment (ROI) analysis may be too complex for smaller firms.  ROI calculations help SMEs recognize how an IT investment pays off - either in building sales, reducing costs, or improving productivity and customer satisfaction. Suggesting that SMEs are not "sophisticated" enough to do ROI is insulting to say the least. The problem is that most enterprise consultants cannot understand how to scale down ROI to make it realistic and viable for small businesses. InnovaIT and other SME specialist consulting firms regularly conduct successful ROI engagements to the benefit of even the smallest firms. The payback period analysis should be a part of ROI, not a substitute for it. As a developer we also look at ways to make the business model fit the client so that money is built from the business application to allow them to plow a portion of profit or savings back into application development and maintenance.

Plan your IT future: Now here's one I agree with entirely. The article suggests that "Dedicating more money to IT won't help if you don't have a plan for what you hope to accomplish". Our approach (SMEPortfolio) is a way we help our clients to plan and rationalize IT projects as a continuous part of their strategic development. It also helps the business to understand where IT assets live, what knowledge is necessary to maintain and build on the benefits it offers to the business, and when an asset needs to be replaced, upgraded, or retired.

 

Make IT part of management: Again, this seems an altruistic statement and once more the article misses the mark. It starts off by suggesting that IT Managers should be part of the management team, and then (perhaps realizing the folly of expecting companies to be able to afford one) goes on to suggest that a dedicated IT Manager would be sustainable at about the $30-50 million revenue range. Yikes! Is he sure he understands small business? Well scaling this to the more common experience we could say that for very small businesses, the owner needs to make IT a part of both operational as well as strategic skillset she will maintain in her own portfolio. As the firm grows, the operational skillsets still need to be managed, but operationalized to other staff. IN the interim both operational and strategic IT does not have to be absent - it can be outsourced or acquired through smart partnerships with firms, like InnovaIT, who have learned to serve the IT needs of small businesses.  

Take care of the basics: Alright - this is nicely done and the advice is to follow a model like Maslow's pyramid, whereby the basic survival assets (desktop applications, email, firewall, internet access, security and antivirus) are taken care of before you invest in the next level of IT needs like productivity tools, specialized and custom applications. Even when you are working at projects to get to the next level of IT benefit, you still have to support the basics. Moreover, the small business owner really doesn't want to focus on technology at all, if that is not what they are selling or servicing. All firms should look after core business first and may benefit from outsourcing those functions that only support the line of business. For example, in-house web hosting makes little sense unless there are internal security requirements that enforce self-hosting.

Choose your vendors wisely: This is probably where he lost me the most. I have written in the past about strategies for vendor selection and so I get that bit - but the idea that you will inevitably out-grow your IT vendor fails on two counts: first, because if you pick them well, your vendor will likely be of the same school as far as growth and development is concerned. The growing business should pick a growing IT firm, while the lifestyle business may hire the developer who doesn't have IPO as the exit strategy; second, because many firms do not expect to grow to become major enterprise operations it doesn't seem that they should expect that they will outgrow a firm that understands them, and has been their trusted counsel for many years. By all means make changes when you need to, but jumping from vendor to vendor at a whim can lead to system instability that can be more trouble than benefit.

Keep learning: OK - right again! This is the notion behind the SMEPortfolio; your world and the world around you are always changing. To successfully compete and to enjoy prosperity in your business you need to continue to scan your environment, your market and your firm for opportunities and challenges atht may be improved through technology. As an old client in Newfoundland said "At the end of the day I want to be richer or smarter: and preferably both". They aren't mutually exclusive, which is why the notion of the lifelong learner is so right.

 

Mr. Widman has brought some very cogent discussions to bear on small business IT planning. It is unfortunate that his view of small businesses is from a perspective that can hardly appreciate them. Dancing the six-step with such disconnected strategists reminds us why dance partners tend to sort themselves according to best fit. Keep on doing that SME boogie!