In the business technology trade, we use a jargon term called keeping the lights onWater Down a Drain

In the English language, what this term means is the percentage of your IT spending that does nothing but maintain and keep running those IT assets (software, servers, etc) that you budgeted the CAPEX cost for years ago.

That percentage is then compared to the percentage of your IT budget that is left over after you have spent the “keeping the lights on” money for you to invest in improving your IT assets or infrastructure or investing in new capabilities

In most cases – that left over money is not very much.

One statistic states that in 2007, 71 % of IT spending was on sustaining initiatives **

‘Sustaining’ being synonymous with that ‘keeping the lights on’ term

The Big Company vs. the SMB

Larger organizations usually make the headlines in these type of costs, simply because 71% of a 100 Million IT budget is a boatload of cash.

We Are Not Immune

Those of us in SME businesses are not immune from this. This post titled; In SMB IT, Complexity Kills I outlined a smaller business that had enough conflicting technologies to make a large business proud.

Looking at each investment individually, perhaps the cost does not seem that high, but the manpower to maintain those individual pieces, even simple things like ensuring you can back up data in multiple different platforms and databases. Lets not even think of the time and skills required to ensure security patching and the like.

The SMB Takeaway

Your capital spending on software or servers today is your operating costs next year

**Weill & Ross IT Savvy Harvard Business Press

Photo Credit David Blackwell via flickr

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Let me paint a picture of two scenarios here, if they have not happened to you yet, buy a lottery ticket, because sooner or later, they will!

Scenario Number 1!

It is too early in the morning, but you manage to pour yourself that coffee, sit down at your desk, and promptly spill that coffee all over your notebook keyboard.

Scenario Number 2!

It is still too early in the morning, you still manage to pour yourself that coffee, power up your computer…. and meet;

a) a black screen
b) a blue screen saying something along the lines of BOOT ERROR KERNEL FAULT IN MPORTDRV.SYS
c) Maniacal laughter as your PC grinds to a digital halt

OK, so number three was exaggerated, but the first two were not!

As an owner or manager of a smaller business, I am sure that your technology service provider set up a server for you. They probably handed some backup tapes to whom ever is sitting closest to the server as well!

But are you actually using that server?

Or are those proposals, invoices, and reports just sitting on each persons computer or notebook?

uh huh??

You probably have most of them on your machine right?

The SMB Takeaway

Your Tech Services provider may have set up your server to back up all your data, but most likely they did not set it up to back up data on every individuals personal computer!

And if your data is not on that server when the coffee meets the notebook keyboard….

Good luck with any data recovery.

Even if you travel a lot and absolutely need your data, every few days make sure that you at least make a copy of it on your server. If your machine dies, at least you have something!

An ounce of prevention….

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Photo Credit cathyse97 via flickr

As small to medium business Owners or Managers, at some point you realize that the time has come to look for some leadership to take control of your IT  team.

Like most businesses, in your early stages of growth you probably hired your IT staff based on particular skill sets that you needed. Perhaps those skills were with certain Point of Sale systems, database software or email servers, etc.

While skills and experience are critically important when supporting and fixing your existing technology and software tools, that requirement for a particular skill level begins to change as you begin looking for higher levels of IT leadership. Those exact skill sets can become less relevant than business results.

That is not to say that there can be zero technology skills!

As SME managers, we need to wear many hats. That includes your IT managers. We need (‘we’ meaning  business technology leaders) to maintain our technical skills, but we also need to grow the more business results oriented strategic planning, relationship, and project skills.

Skills, Results: Let me paint an example

As a growing business lets imagine that you have reached the point where you have decided that you need to invest in a larger resource planning (ERP) or financial application.

This can be a huge investment, so after many discussions with your peers, and maybe a consultant or two from your local Chamber of Commerce, you think that a particular product will be perfect for you. Lets also assume that those same discussions convinced you that to support this type of technology initiative, you will need to go beyond your current break/fix  tech geeks to a true business technology leader who can be responsible for delivering the value you need for this investment.

Answer this question;

When you call the placement agency, or publish the advertisement, what importance do you think skill with the product you chose should carry in your hiring decision?

The answer is not necessarily much!

Next, lets assume you are now interviewing a few candidates for that IT leadership position.

One particular candidate looks excellent. She has great recommendations, and has successfully implemented ERP or financial software a few times already!

But! she has never used, or even seen that particular ERP or financial vendor’s product that you want to implement. Do you think that matters? Do you write her off the short list?

Here is a tip!

A strong business technology candidate will pick up different software skills easily. Example; I was once flown in to fix a problem with software environments I had never seen before, it was less than two days until I understood enough to fix the issue.

It is the skills to discuss, negotiate and implement the processes behind the software are the harder ones!

Your candidate can demonstrate that he or she has obtained the results that you are looking for several times, it is only because each time she was using products that are competitive to the product you have chosen that you are considering knocking her off the short list.

So in this example, the demonstrated results this candidate can show far outweighs their lack of skill with your chosen software package.

The SMB Takeaway

Skill and experience with a particular product can be critical when you are hiring someone to babysit a particular tool or product, but demonstrated results is the critical metric when you need leadership to provide business benefits from your IT investments.

Hire Well!

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