IT gadgets, tools and systems are now so pervasive we can scarcely imagine life without them. The importance of IT to businesses, and their economic success, in particular cannot be overestimated.
However many small and medium sized enterprises find the prospect of taking the ‘technology investment plunge’ a daunting prospect, faced with clamouring vendors and a barrage of jargon, and as a consequence difficult to get the right solution.
Businesses are constantly bombarded with messages about the latest ‘must have’ technological development that boasts of being the fastest, cheapest or most secure. The heavy descriptions that accompany new product launches can breed confusion, even amongst the most tech-savvy people.
For small businesses, though, this effective information overload is particularly problematic simply because the person procuring IT is often not an expert. Indeed, for small businesses it is often the case that major IT decisions are taken by someone whose primary role is elsewhere in the business or simply, in many cases, the owner of the company.
Is it not surprising then that many companies end up buying over-complicated or unsuitable IT systems that they do not have the expertise to manage or understanding to truly benefit from. This in turn causes headaches for businesses, as issues arise which they do not have the ability to solve and, in time, many come to resent their investment for not giving them the return they expected.
Such bad experiences can in turn lead to a distrust of the IT industry as a whole, leaving the small business owner increasingly unsure of where to go for help.
The fact is, to realise a return on investment (ROI) from technology investments, businesses need to plan. Making the time to build a business case for an IT implementation might not sit high on the day to day ‘to do’ list of a small company, but it is vital if they want to gain maximum benefit from their investments.
Indeed, a recent KPMG study reports that 56% of firms have had to write off at least one IT project in the last year as a failure, and the average loss incurred as a result of these failures was about €12.5m.
An excellent example of where small businesses are losing out on huge technology gains is with ‘convergence’.
Technology evangelists wax lyrical about the benefits of today’s converged networking communications – cutting costs, improving productivity, boosting customer service and enhancing competitiveness. But migrating to a converged network, with voice, data and a whole host of business critical services running over a single infrastructure, takes careful planning.
Recent research from BT Business reveals that a lack of planning, along with confusion around the technology involved means that the majority of small companies that have migrated to a converged network are failing to realise the potential or articulate the true value of their investment. The research showed that an alarming 78% of companies did not build a business case to measure ROI and, unsurprisingly as a result, nearly two thirds, or 60%, could not indicate results against their expectations.
Effective planning and deployment of converged technologies can really transform an organisation, making it measurably more productive, agile and competitive. The fact that convergence is so high on the small business agenda (37% have already invested in a converged network), but with many indicating a failure in planning and understanding ROI, clearly points to a requirement for education and support.
Convergence is a huge opportunity for UK businesses, but to maximise the potential of moving to a single communications infrastructure, businesses of all sizes need practical guidance about how best to approach a project, whether a business decides to embrace a wholesale change or a more gradual step-by-step migration, seeing the benefits as they go along.
The root cause of the failure of small business IT projects is that the business case, and a process to manage and realise the benefits the project promises, has not existed or where it has not had a significant presence.
Expectations must be managed, too – the realisation of benefits from IT implementations can take time, they do not just happen. For a project to be successful, the benefits a business wants to achieve must be set out from the start and that objective embedded at every step of the roll out of the solution. Without that clear vision or direction, the delivery of measurable business benefits becomes difficult, if not impossible.
The simple fact of the matter is that most small companies are not making the most of their technology investments. The benefits are certainly out there, and are achievable, but success is dependent on careful planning and project management.
© Crimson Business Ltd. 2006