Real SMB IT: Consulting Services And Scope

Lets try this little story on for size!

You want to hire a plumber to replace your kitchen sink. So out you go and you get a couple of quotations, here they are;

Vendor number one’s quote states; Replace sink

Vendor number two’s quote states; Replace sink, Re-install existing faucet hardware, modify plumbing to fit new sink

Now which of those above quotations make you feel most comfortable that all contingencies are met?

Which one makes you comfortable that there will not be surprises on the scope of work or billing?

Maybe Number Two??

Unless you have a long history of service and trust with the vendor of quote number one, you can understand that that quotation number two covers the bases in a lot more detail.

Now, How About IT?

For smaller businesses it can be fairly common to use outside contractors and suppliers to perform installation or maintenance of your IT assets. Maybe you don’t have full time IT staff, or perhaps you just have a small IT staff that needs outside help in performing a larger task.

But like the example above, don’t forget that there can be a problem here!

It is a natural, but often invisible problem that exists because your contractor, supplier or VAR (Value Added Reseller) and yourself can be looking at the same event or work, but through different lenses.

Freebies vs. Being Nickled & Dimed

For yourself as a manager in the small business space, you are thinking;  “Well since they are here installing that server anyway, I am sure that they can take a few minutes and do this upgrade to our MS Office applications while they are here….”

But for the Management of that vendor or contractor, they need to have their staff into, and then out of your office in the time frame that they quoted you to install that server, and adding what could be an hour or more of time to upgrade those MS Office installations was not part of their plan.

This type of disconnect can lead to frustration and distrust on both sides.

Your supplier feels that you are trying to drive them out of business supporting you with freebies, while you think that they are being unreasonable and doing a nickle and dime routine because you think that the little thing should only take a couple of minutes.

Get Rid of the Disconnect With Proper Scope

To remove this disconnect when sourcing IT contract work, ensure that your vendor and yourself have an itemized list, or breakdown  of each and every task that are to be performed for any particular contract. This will be the scope of your contract engagement.

This point is also the time to discuss those little extra’s.

You think that a few minutes will upgrade your MS Office applications, and they can respond that with 17 workstations at 10 minutes per workstation (assuming nothing goes wrong!) you are looking at almost another three hours of labor.

The SMB Takeaway

When dealing with IT service providers of any kind, ensure that you have an itemized list of the work that is being contracted for. And ensure that it is broken down to as granular a level as is possible.

It takes a bit more time up front, but it is time well spent.

Because both parties can develop the trust that what was contracted for is reasonable, and mutually beneficial.

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Photo Credit using neighbo.com via flickr

Real SMB IT: Work With Suppliers

I can guarantee that if you look hard enough, you can always save a dollar or two buying IT related services or supplies at a different spot each and every time.

But before you do that, ask yourself; are you are building a supplier relationship that is a win-win situation?

A win-win situation is collaborative, it is trusting, it is knowledge.

Anything else will most likely be just adversarial. And when the chips are down, adversarial won’t help you too much.

Try to cultivate a couple of suppliers. And work to maintain them as you would a large vendor or customer.

One good reason for doing this? – If you have particular industry specialty requirements, if they have that expertise, they can be a valuable source of advice.

And second, if you are treating your suppliers in a win-win manner, when there is a problem, you are more likely to get the ‘A’ team to help you.

Case In Point

I had a complete system failure of a critical piece of IT infrastructure. With nothing more than a phone call, replacement gear and service techs were on site replacing the dead pieces in just a couple of hours.

If I had spent the last five years beating them up on nickle and dime differences from Joe’s PC Supply, would there be that same relationship?

I doubt it.

I am not advocating following military spending habits and dropping 5 Thousand dollars on a hammer!

But bouncing around your suppliers trying to get each one to drop a dollar to meet the competition until there is only one left standing does not do a hell of a lot for you in the longer term.

So cultivate them, treat them with respect. Like any relationship, debate costs, even constructively argue!

Because at some time when the chips are down, collaborative beats adversarial

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Photo Credit Aidan Jones via flickr

Utility Computing: And What’s In A Word?

If you have been reading this blog for a while, you know that I believe that computing will become more utility oriented. That there will be less reliance on what we currently look at as internal technology infrastructure.

My belief in this came about in the mid 80’s when I read that every automobile manufactured in North America had more computing power built into it than the NASA moon shots.

If you have read Nicholas Carr’s IT Doesn’t Matter you will notice one key difference, I never saw it as the world of software that we currently have, the way I saw it back then was along the lines of intelligent hardware devices. Similar to the “smart” thermostats in most new homes.

This type of Utility IT has often been compared to electricity – just plug it in, and pay by the sip. I have used that analogy myself.

But there is an excellent warning by Andrew McAfee, formerly at Harvard, now MIT. He argues that we should not try to simplify this concept down to the simplicity of an analogy like electricity.

His argument is that even in a more utility environment, IT is not as simple as 110 or 220 volts (North America) coming out of a socket. There is no decision to made there, no decisions or management is required around an electrical socket.

So using terms like electricity may overly simplify, or “dumb down” our thinking of IT.

And that is dangerous.

When was the last time you talked about electricity at a management meeting?

Exactly!

And even if get your IT through a wall jack (eg Salesforce.com)  There are still management decisions that must be made. We use technology to create or consume information. To do that there are work flows, business processes and certain business metrics and capabilities.

All of these will still demand management attention, demand decisions, and need to be top of mind for all businesses.

So, you can consider me a convert!

Will more and more of our IT resources continue to come from outside our walls? Yes,

But will you be able to plug in a cable and by magic have exactly the information, processes and work flows just appear? No!

It will still need management attention – lots of it.

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Are Your Invoices This Bad?

Spent most of the day going over a suppliers invoices.

Now they are for services, not products which can always be more complex.

But services that are absolutely wrong

Services that are mis-named

Services with no reference

I could go on.

The SMB Takeaway

Don’t make that mistake.

Being easy to do business with includes your invoice.

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Photo Credit TravelingMango via flickr

I Am Furious, Just Frigging Furious

I had a chat with one of our corporate field staff yesterday.

He had me absolutely furious. Literally.

And No – It wasn’t our staffer that had me furious

He has been having difficulty in dealing with a customer, because e-mail kept failing. It turns out that e-mail from our domain was being blocked – in fact e-mail from this customers biggest supplier was also being blocked.

3 months of unresponsive IT requests to get it resolved.

When the owner of this customer business finally forced the IT contractor to respond, the contractors words were;

I control the systems

bull shit

Let me tell you arse wipe – you don’t.

You control f*** all

You may maintain it – that is it. Period!

It is a business asset. And a business tool.

As such it is controlled by the business

PS: An I hope you read this because I told our field staffer to have that owner call me you arse wipe. 

The SMB Takeaway

You IT assets are yours. Not your IT staff or your suppliers – Yours and yours alone.

If you have a staffer or supplier like the above, kick their effing arse out the door.

PPS: My apologies for the language.

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Photo credit by anguila40 / Alejandro Groenewold via flickr

I’m Not Calling You Back

About a year ago a local vendor called me and asked to send me a catalogue of their services.

Foolishly – I said sure.

Since that day they have sent me at least 3 (sometimes more) SPAM E-Mails a day.

After Day 1 I just started sending them to the SPAM bin – so I only see them every month or so when I go to empty it.

Now I get a voice mail today asking me to call them back.

Sorry - 

Not gonna happen.

I do not do business with vendors that SPAM me, or anyone else.

 

SPAM

 

 

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Psst – Wanna Save Some Cash?

Seriously?

I did it! You can too!

OK, that sounds too much like one of those “Available only on TV” offers.

But reality is that in the Small Business space, technology spending is often an ad hoc an affair. I saved quite a bit of money just cleaning up the entire purchasing process of IT OPEX and CAPEX expenses.

1) If your chart of accounts does not already break out technology expenses, you should do it. At the very least an accurate addendum of fiscal costs should be kept.

2) Get rid of ad hoc purchases – ensure that written requests (electronic or paper does not matter) for all purchases exist and are signed or approved. Approval levels may be different depending on dollar value.

3) Ban credit card or retail account purchases. Utilize distributors and re-sellers.

These simple steps can save money in multiple ways. Direct costs are lower through the channels, plus accounts of Net 30 with a a few points is a lot less than credit card rates. And ensuring that proper sign off is made gets rid of the requests for some “cool” thing that is “only” 300 bucks.

Longer term, it provides visibility into which parts of the organization are generating the most IT spend requests, and helps identify services or components that can be reduced in price or utilized better, leading to lest wasted spending.

And finally, it provides excellent detail into operational expenses that can be tied into improving future budgets.

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ITIL and the ITSMF

Due to the number of visitors here looking for information on the concepts of ITIL (IT Infrastructure Library) I am guessing that many of you are seriously considering it. If you are looking for more in-depth details than my little “Notes” on ITIL on this blog, here is where to dig deeper.

The IT Service Management Forum is an International non-profit organization dedicated to promoting and facilitating ITIL. There are chapters in most major communities through which you can find resources or training.

International: http://www.itsmfi.org/

Canadian: http://www.itsmf.ca/

US: http://www.itsmfusa.org

And yes, I will be continuing on my little “short form” overviews ASAP.

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Opportunity Lost

A recent post by Marketing Guru Ron Shevlin is titled “Debunking Marketing Myths: Single View Of A Customer”. Mr. Shevlin seems to paint a pretty accurate picture of the “CRM” universe as not supplying the desired bang for the buck in “knowing your customer”. I find that a lot of the issues he identifies can be classed under “information overload”. How much data do you collect, and in what areas of contact does it have any real value. Lack of this this information makes it just too burdensome and risky.

I can agree with the “macro” points, however in my humble opinion, the “basic” business specific data that you have collected about your relationship with your customers should be used as a method of driving new sales, and increasing customer satisfaction.

You will notice my emphasis on “basic” – I don’t want my credit card number on your call centre rep’s, or receptionists desktop.

Here is an experience I had recently, an opportunity to gain incremental revenue from me was lost by a vendor in my local region. Losing a revenue opportunity by losing a customer is bad enough – but giving it away by not even trying? Before going further with this opportunity lost, lets look back in time.

Twenty five to thirty years ago, there was some real brand loyalty.This loyalty was, if not written in stone, then was at least a fairly consistent and desired end. Brand loyalty, whether it was for large products such as automobiles, and down to small ones such as toasters or stereos, the product was often purchased because it was made by a particular manufacturer. Brands were almost as sticky as our voting habits on election day.

We all should know that those days are gone, I am just as “guilty” of that as anyone else. I have owned cars manufactured by at least 7 companies, My home entertainment system is a mix and match of another half dozen brands, and I haven’t even a clue what brand the toaster is wearing.

We don’t have that luxury of sitting on brand identification any more. Some large organizations try to maintain some of this brand stickiness by improving the customer experience through enhanced customer communications management. Using previous history and recommendations we get those targeted mailings that try to spin products and keep our “mind share” of the brand. Granted, 1 to 1 Media has a great comment on how not to do these targeted (or mis targeted) communications

Mistakes like the above notwithstanding, we must make better use of the information that we do have to drive revenue – particularly in the durable goods, IT and other channel based industries. While margins on many goods and services purchases are shrinking, more top line revenue is coming from servicing those purchases. Not to mention good service keeps your brand top of mind.

You should be capturing that sales information, you should be using it to market after-sales parts, service, accessories – whatever fits your product. Don’t leave those dollars to someone else. I guarantee that the “someone else” is out there looking.

Now we can return to my opportunity lost, Approximately 2 years ago I purchased a new vehicle, but at that time I chose not to purchase the extra service warranty or other financial products that the dealer was offering.

So now we fast forward almost 2 years, and I have the car in the service shop for an oil change and maintenance with just about 5 thousand Kilometers (approx. 3100 Miles) before the default service warranty expired.

Being in the Technology field, and with a strong interest in marketing, I was wondering to myself how long it would be before I received something in the mail (or email) plugging the extended warranty and other finance products.

I never got it. They don’t know me.

I mean the sales guy knows me, he greets me by name whenever I am in the dealership. The service guy also knows me, when I call for service, or arrive for service, they greet me. However the “organization” that they work for does not know me. If they did, what the sales staff knows (no extended warranty products were purchased) and what the service staff knows (warranty almost expired) would have been an open invitation to initiate a dialogue on the extended service warranty opportunities.

As an IT Manager, I can quote a dozen jargon words on customer relationship technology, but at the end of the day, the job could have been done with cue cards and post-it notes. The process is more important than the technology.

“if you get the product, price, and location right, service is the most important variable” Larry Stevenson – founding CEO Chapters -Canadian Business magazine February 18 2008

Sales, Service, and Education

I liked this article at 1to1 Media Forrester Research is quoted as saying that 20 percent of High Definition Television (HDTV) sets sold at retail are returned – not because they are defective – but because the consumer had no idea that the set was not going to give the expected HD user experience unless both your cable provider has HDTV services, and that you are paying for those extra services.

I was happy to read this, because I am now aware that I am not alone. Over the years there has been more than one instance where I have purchased something that had a dependency that that would negate its usefulness unless I had that dependent part or piece. Even in speaking with sales people at the time of purchase – in these cases not one had said – by the way – for this to work, you need …

The end result for me is either a frustrating return to trip to the store to either return the item, or purchase its dependencies. Neither of which makes me a happy customer.

On the flip side, the opposite can be true. I purchased an Apple iPod accessory as a gift, the sales representative walked through the requirements of the model compatibility and the types of adapters each model would require. If I ever need another accessory for these things I know where I will go. (I am not an iPod fan, but that is another story)

Although the above article references retail, service businesses can be just as bad. I recently had a services company provide as estimate on some work that I want done. Not once was I told that the quotation was useless unless I already had another particular service performed first. It was only casually mentioned to me by someone else who had already had similar work done. Needless to say I still don’t have that particular work done.

In todays competitive, and very low loyalty market, it makes sense to educate your customers. At its simplest, they won’t be sticking you with returns costs, or just avoiding the product or service. If you are lucky enough to supply the dependency, it is also a cross sell opportunity.

Unless of course, you are one of the lucky ones who don’t need to worry if your customer ever comes back.