1. Don’t dismiss the possibility of outsourcing some or all of your IT functions
All the talk about outsourcing i.e. getting a third party to take over the management of some or all of your IT functions and selling it back to you as a service, seems to focus on large organisations like Bank of Ireland, who outsourced it’s entire IT operation to HP in a massive multi-million euro deal last year.
The move towards outsourcing amongst small and medium-sized companies is also firmly underway but some fall at the first hurdle according to Pat Millar, Managing Director, Clarion Consulting. ‘Some companies attempt to use outsourcing as a means to addressing business problems they have been unable to resolve themselves, i.e. poorly defined processes or low customer satisfaction. Smaller companies must consider their motivation for outsourcing very carefully.
If their primary motivation is to achieve cost-savings, their strategy is probably misplaced as they simply won’t achieve the economies of scale required to translate into meaningful cost reductions. In this case, outsourcing is all about achieving improvements in service levels. Similarly, smaller companies should be mindful of not over-engineering the solution. Keep it simple and use selective outsourcing where possible. For example, you might outsource desktop management to a third party but keep the support for a mission-critical business application in-house. Smaller companies should also seriously consider bringing in some external expertise to help with the outsourcing process. Skilled consultants can help with every step of the process from defining a framework to vendor selection and the exact nature of support required can be specified upfront, in an effort to minimise costs.’
2. Do investigate open source and evaluate its merits against proprietary offerings
Open source software has been around for a number of years now and while in the early days you definitely needed to be of a technical bent to harness it for your business, that’s no longer the case. Unlike proprietary software that you might buy from Microsoft, Oracle or Sage, which is owned by the company in question, open source software is owned by the community that develops and uses it.
Open source alternatives are now available for every category of software that you care to mention – from CRM to office productivity suites, graphic design to web browsing – many of which can run on Windows as well as the alternative open source operating system Linux. (Check out www.linux.ie/newusers/alternatives.php for an extensive list.). While much open source software is available free of charge to download from the Internet, commercial releases which provide support and updates from software companies are available. Not surprisingly manufacturers of proprietary offerings feel there are advantages in having the support of a single vendor. ‘Our customers and partners tell us they want software that helps them be more productive; software that is secure, reliable and that interoperates simply with their IT environment.
Microsoft products are designed to deliver this — all at a lower total cost of ownership than alternative products,’ says Mike Hughes, Security & Platform Strategy Manager with Microsoft Ireland. ‘Customers are sometimes lured by perceived low costs of some open source software products. However, the cost to setup and maintain the system forces customers to spend more time and money managing their operating system as opposed to focusing on their customers. This is supported by numerous independent analysts, e.g. Gartner benchmarked Linux on the desktop with Windows XP and found overall cost of ownership was 15 to 20% lower on Windows. It is as a result of this that our partners and customers are moving to and staying with the Windows Platform.’
3. Don’t underestimate the security threat
If you are running a tight ship and keeping a close eye on costs, the temptation can be there to skimp on IT security – after all it’s never going to happen to you, is it? Wrong. Today’s pervasive security threats such as viruses, spyware, and phishing scams are delivered over the Internet and are not discerning in who they target. John Mooney, Sales and Business Development Manager with Renaissance Contingency Services which distributes security software believes that keeping on top of security threats can be difficult for SMEs, particularly those that don’t have an in-house IT manager. ‘It’s probably not so much about what software you need to have but about having a security policy in place,’ he advises. ‘It shouldn’t be draconia and decided by the managing director, but should have agreement from everyone in the company. Everyone should know the security implications of what they do, such as bringing USB keys into the office and plugging them into their PC.’
4. Don’t be afraid to let technology make you look like a large organisation
The open source movement is just one demonstration of how the traditional models of licensing and using software are changing dramatically. Many companies are now adopting a pay-per-use model which means SMEs can get access to enterprise class software by simply paying a monthly fee per user. ‘For far too long, the SME sector has been ignored by software companies and treated as second class citizens,’ says Fergus Gloster, Vice President EMEA, Salesforce.com. ‘The functionality available to SME companies was too restrictive and did not enable the users to manage their business in the same professional manner that enterprise companies do.
The barrier was simply, money. If SME companies can’t afford to pay, they cannot provide the service they want to their own customers. On Demand Solutions change all of that. The same Customer Relationship Management(CRM) functionality is available to SME and Enterprise customers at the same affordable price. The pay as you go model allows companies to use the service at a cost and effort relative to their own size, but without compromise. SME companies, using salesforce.com, can manage all of their customer interactions on a continuous basis. All the user needs is a browser to access the server. There is no need to build an expensive network or maintain a costly upgrade. Therefore the barrier to entry, money, is removed and SME customers can play on a level playing field.’
5. Don’t forget about regular back-ups
What would you do if your office burned down in the morning? Would you have a complete back-up of your customer account details, your business accounts and other vital data. With network attached storage from vendors such as StorageTek, Iomega and others at an all-time low, there is no excuse for not taking a regular snapshot of your all important data. Most PCs now come with a DVD burner as standard so at the very least you should be burning a disk once a week and storing it off site. For a rock solid back-up why not consider one of the services offered by the data centres, such as Interxion’s Secure Data Services, where files from your network are automatically sent to the data centre in encrypted format at regular intervals.
6. Don’t tolerate spam
Spam, or unsolicited commercial e-mail, doesn’t just waste staff time and undermine their trust in the Internet but increasingly carriers threats such as viruses and phishing – where hackers try and get usernames and passwords of online banking services.
According to John Mooney of security specialists Renaissance Contingency Services, spammers, virus writers and other unsavoury types are now teaming up to such as much money out of unsuspecting businesses as possible. ‘Spammers are now using the social engineering that virus writers have been involved in for years and now transferring that to phishing,’ he explains.
At the very least you should be using some of the e-mail filtering applications that can be purchased online such as Spamarrest and Mail Sanctity. Most ISPs also offer server level filtering of spam so it is removed before it even reaches your business and when combined with desktop filtering should catch most unwanted mail.
7. Do get a handle on your print costs
Do you know how much you spent on printing last year? Or do you just have a vague feeling that consumables such as toner and ink for your printers seem to be costing you a lot? If so, don’t worry – the experts say that even businesses with tight control on other costs rarely have granular control of how much they are spending on printing. Edel Creely, General Manager of DataPac offers a number of tips to reduce these costs: ‘Don’t let your personal printers get out of control – use network printing; save money by standardising your printers, therefore standardising your consumables; go for duplex printing to save on paper cost; consolidate your photocopying and printing needs with a multi-function device; use digital sending to save on fax/courier costs; use original manufacturers consumables – it saves on maintenance costs in the long term; install HP WebJetAdmin software utility to monitor and control toner usage.’
8. Do electronic transactions with your bank
If you still haven’t joined the online banking revolution what are you waiting for? With most of the major banks, with the exception of Bank of Scotland Ireland, reducing the amount of branches they have, you’re probably going to have to spend even more time travelling to a branch to do the banking in person. As well as saving time you can also save money off the bottom line.
Bank of Ireland estimates that by using its Business On Line service to pay suppliers rather than writing a cheque businesses can make a saving of 76% on each transaction. Taking into consideration processing charges, stamp duty, postage and administration a cheque costs about EUR*1.20, while an electronic transaction should only cost about EUR*0.29. Other advantages of Business On Line according to the bank include faster, more efficient cross border payments, flat charges on all payments, reduced paperwork and an exclusive discount on broadband.
9. Do invest in a broadband connection
Speaking of broadband, have you joined the revolution that has taken place in business internet usage in the last year. If you are still using expensive leased lines or worse still muddling through with dial-up connections then you should consider changing over to one of the DSL or wireless services that now have almost nationwide coverage.
Ray Tobin from BT Ireland sees the business benefits of broadband falling into three main categories – people benefits, customer service and profits. ‘The installation of Broadband from narrowband will absolutely provide major benefits to end users,’ he says. ‘Employee satisfaction will rise as no longer will they be facing the pain of dial-ups, slow upload and download of mission critical applications, files or documents, or the real kick in the teeth is when you get cut off just as your download is complete. Broadband can also facilitate teleworkers who can avoid time consuming and frustrating commuting.
Real time interaction with your key customers will be both a customer acquisition capability and just as importantly a customer retention one. As you can respond in real time to your customers, satisfaction with you and your products can only improve. Broadband enables you to fax, talk and surf simultaneously thus saving time and money.
You can cut down on expensive travel by using bandwidth hungry video conferencing. With fixed monthly rates there is no need to worry about unforeseen connectivity bills. You may also save time and money by having the capability to outsource non-core activities such as payroll or CRM tools.’
10. Do a price comparison of all of the telco providers
If you haven’t considered changing telecoms suppliers you could be paying more than you need to, according to Paul Connell, a director of Pure Telecom. ‘Would you ignore a reduction of 35% and upwards in any of your overheads without any associated costs?’ he asks. ‘For a business, switching telecoms supplier could not be easier, and is a simple method of substantially reducing your telecoms overhead without any headache. Transfer of service is seamless and there is no disruption to the business.
Key factors in reviewing alternative operators include price, billing, customer service, and range of products. The vast majority of business customers want a cost-effective solution that matches their requirements for voice, broadband and line rental with a high level of “One-to-One” customer care. And if these can all be provided on one bill, even better.’
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