Four small business advisors specialising in strategic planning, technology implementation, financial management and human resources discuss the WHY, WHEN, WHAT and HOW of using technology to support business growth
Meet the panel
The Panel Q & A
What are the questions that we should be asking and the criteria we should be looking at to determine whether we should be implementing technology improvements in our own business?
I think as far as the why or the sort of questions you need to ask, I’m always looking at technology as an enabler.
For me, it’s something you can use to do something faster, better, more efficiently. It might also be something that enables you to do something you couldn’t do previously. From a planning perspective, I’m always looking to see how do we improve what we’re doing today for the benefit of the business and also from a shareholder perspective.
What are the qualification criteria?
lt comes back to cost benefit. The benefit can be measured in many ways, not just dollars. The opportunity to do good things is a benefit, but everything comes at a cost. I’m always looking in the objective, cost benefit, how do I get more material value out of applying money to this technology? If I can’t get that and I can’t see that then it’s very hard for me to support it.
Things that I’m looking for: Efficiency, visibility, enablement, a lower risk, better quality control. You know, just to name a few. Communication is another strong one.
Sometimes we just don’t know what we don’t know. What are some of the possibilities that technology opens up?
I think the big one is productivity, especially in small business where you’ve got a limited amount of staff and there’s only so many hours in the day, technology is an enabler to get more done with less. That might mean you can take some work that someone was doing that’s manual, manual data entry and have that be automated and then they can do more value added things in the business. In extreme cases you don’t need to employ them anymore because the technology is replacing them entirely.
I think the other thing is scaling. Technology allows you to scale faster. Obviously when you’re trying to grow a business, you know, years ago if you wanted to grow it, you’d have to put more staff on and that would result in higher output and all that sort of stuff. Technology can allow you to do things faster.
Have you got any case studies or examples of of situations where technology has helped your clients’ businesses?
Working in the trades and services area where there’s lots of jobs which have to be allocated to a number of staff at different locations. You can allocate the resources, work out the best route for the tradies to go around. You’re getting efficiency, you’re not getting yourself tied up in an administrative muddle because you can share the jobs more easily on the system and everyone can see what’s happening. The history of the jobs there. So if you’ve gone back to a client who’s not happy, you can see what was done before and who did it. It’s not just about cutting costs, it’s all about giving better service to the marketplace. And I’ve certainly seen this with electricians and plumbers.
If I were just to add, definitely with efficiency, but also collaboration. Thinking about expanding potentially interstate or internationally or you’ve got other offices even in the same state. I’ve seen this with a couple of my clients where they’ve used technology to close the gap. When you’re trying to have discussions with colleagues it can be very difficult if you’re not in the same office. Technology can help with that and save huge costs on travel.
How do you decide when the timing’s right?
There’s probably two answers to that. There are two sorts of time you need to think about:
- From a strategic planning perspective where you take a step back and look at the whole business picture. Technology is just an element that sits in that. I’m looking at the allocation of that point in time based on the overall plan. Sometimes the case, we always want the technology, we want it today. But the reality is there’s five other things in front of it that need to be done first.
- The other part though is also then the operational side of things that just day to day there was always technology need. That just needs to be assessed or sort of like as a business of usual sort of circumstance and on its own individual merits and within the scope of the business.
I was thinking from a people perspective the right time is when there are potentially inefficiencies within the business or if there are questions around output. That would be the time when you would be thinking, could we be doing this better with technology?
How do you work out the potential ROI?
Some of the technology today is actually very cheap and there’s pay monthly software as a service, which is one of the benefits of the cloud model.
But I’m going to assume that we’re talking about a substantial investment, which is a real make or break for the business.
It’s got to work if this a big commitment in money.
So how do they go about making the right decision?
The key is to make sure you’ve got all the information available. You can’t go with this decision on gut feeling. It’s got to be based on facts. So the CFO has got to get involved with all the issues before a decision’s made. Gather all the information and the sales people are saying, but with this technology we’re going to put sales up 10% and the CFO says no, hang on, what’s the market like? Is there a market out there for you to sell to?
The CFO has really got to be cynical about what people are telling him. Is there anyone else who has tried what they’re proposing? What are the marketing costs? What have you actually got to do to get these sales? Production people talk about improvement in the inefficiencies by 25% well, does anyone else have that sort of gain?
What about the human side? You know, people don’t adapt very well to change. What’s the impact on the business and how much training is required? Do we have the right level of skills? What’s the cost of bringing extra people in? What’s the cost of redundancies if we have to make them, what’s the savings we’re going to make?
What’s the REAL cost of the technology with all these other things factored in? Most important of all, do you really believe what the IT people tell you?
And if you’re going to develop any of the technology in house you can double the estimated cost, and double the time. That’s my experience.
And you have to look at what other options are there? Have you considered all the options? You looked at the nice thing that that’s bright and shiny. But actually, if we do it ourselves, if we just work with the existing technology, can we do it? So you’re going to put all this together, and make a judgement call.
These are the options, these are the costs and these are the benefits. And by the way, the other option is that we do nothing. And is there a cost to that? Is technology going to bypass us and everyone else is going to get ahead of us? There’s a cost, there’s a loss in that situation and you’re going to assess the risks as well.
Once you’ve considered all these options the next question to ask is what if you’re wrong by 10%?
As a rule of thumb, you want to get payback within three years. So if you’re looking at an up front investment of say $100,000 you’ve got to make $100,000 or more out of the extra profits within three years to justify the project.
Which technologies should I look at first? How do I prioritise?
We see technology doing two things:
One fixing issues in the business. So if you’ve got issues in the business, you’ve got to look at what technologies can fix that. So you know, maybe you’ve got problems with people working remotely, maybe you’ve got site officers are having problems communicating. So you’d look at collaboration software. That’s the first thing. And I think that’s something that, you know, sort of going back to the previous question about when is the timing right? If you’ve got problems in your business, you really need to address those ASAP.
Obviously, it has to add up from an ROI point of view but technology is a driver of business, it’s a driver profit. And if you don’t have that right and you’ve got it causing you issues, then it’s costing you money. So that’s the first thing.
SECOND we look at technology of enabling businesses to grow, to do new and exciting things.
First make sure you have the basics down. You should have, you know, good internet, and I know it sounds basic, but we have a lot of clients who don’t have good internet and don’t want to spend the money on good internet. And there’s nothing worse than having, you know, 20 people sitting in the office waiting for something to download or access a page. And there’s so many great cloud technologies that you need good internet. I would say even look at things like, you know, what hardware are you using? Again, people cheap out on hardware, they buy cheaper computers and you don’t really have to spend a lot to get something that works good, but you do need to spend a minimum level to get something that runs quickly and with, you know, things running out of browsers and stuff. They actually consume a lot of memory and Ram and all that sort of stuff. And again, you could be sitting there waiting for things to process. It’s very frustrating if you’ve got the basics right then you know, look at the software side of things.
What apps are you using to drive your business? You should have the basics covered, you know, CRM, accounting, anything that you might be doing manually that can be done with technology. You want that addressed essentially.
And then you can start looking at other things after that.
The menu of cloud based software solutions available today is exciting and overwhelming. So given that many overlap, how do we find the best combination of solutions to meet our needs?
Yeah, that’s a great question. And if anything, the internet has given us too many options, like just typing in what’s the best CRM into Google and you’ll get back an overwhelming response.
I think the best place to start is to look at your industry first. Like with trades there’s a lot of great applications now that can look after trades that are built specifically for the industry.
I use software in my business that’s built for my industry and starting at that basis, you know, you’re going to get something that’s been custom built for you. It’s much better to do that than look at a software package you think is great and have that customised.
Ultimately, all software packages are going to have something that’s not quite right for you unless you develop your own. And that’s a very expensive road to go down, which most small business and medium business won’t want to do.
I would also say talk to the technology people who are working with companies in your industry because they are the ones who see the software day in, day out. They see what works, what doesn’t. They see what their clients are experiencing.
It’s very difficult to get a fair representation of what’s good by going to the software vendors and saying, are you sure you’re the right fit? They’re going to say yes, of course. Right.
I think, in the end, talking to people who can give you real life experience of what works and what doesn’t work and then you just basically sit down and map out the needs of your business and fit in the software that’s going to work for that. And from that, you should be able to come up with a solution for what you want.
Because a lot of the software is relatively cheap and relatively accessible. You can go into the cloud and go and try it out for at least a month and just working on through your business as much as you can. And in little investment in time, but not much in money is worth doing. Until you really find that the combination that exactly works for you. There’s so many out there. It’s trial and error.
I agree that that is something you can do if you’re a startup, or not that big and it’s not going to disrupt your business too much. There are even free plans or software out there you can do for two or three people.
But it’s not that practical for larger businesses. For bigger businesses trialing it and we have clients who do come to us asking questions and if you go back and say, yeah, this software is good, try it, it won’t happen. They just don’t have the time. It’s just not practical for most people because they’ve got that much other stuff to do in their business.
The other thing is just because you know what it is that you’re looking to improve, you might not know how. That’s where talking to other people in your industry comes in, not just listening to the software sales person
If you have identified an element of the business that needs to improve, well that’s the final test. And all too often I’ve found that people have been dazzled by the bright shiny object, the wonderful glossy brochure, the price tag in some cases, all that wonderful sales pitch. And they’ve ended up with something that’s kind of not really what they needed, and that can be a problem. So to be really clear, you know, spend that little bit of time before you, you know, go at it searching, work out what the issue is that you’re trying to solve for. All right? And the software or the IT solution should be the solution.
From a people point of view, if we’re to be successful in implementing new technology. What do we have to do?
It starts with making sure that your people understand the why. I think a lot of people just want to know, why are we doing this? what’s the purpose? And if you can articulate that early in the piece before you introduce the new technology it will reassure your people that it’s ok and isn’t going to be too overwhelming.
The first thing is to have a very clear communication plan. And by that, I mean the, who, what, where, when and why.
People are always very nervous about change. What does it mean for them? What if they can’t work out how to do it? It can be very disruptive and a very daunting process for people. So, a communication plan, that’s really clear.
Next having a really good training program with ongoing support. When you’re thinking about training, everyone’s different, they learn differently. So, you might want to look at doing some one-on-one coaching on the new technology as well as some small Q and A sessions where people don’t feel as overwhelmed to ask questions because they do get nervous.
And then also access to training material and having a go-to champion within the business. Someone who is actually very good with the new technology and maybe they’ve received extra training with an IT expert. You need to have someone employed in the business who can be the ongoing person who your staff can pick up the phone and talk to for anyone who needs extra support.
The third thing I would suggest is having a couple of ambassadors within your business. You would know within your business if you’ve got anyone that’s a good influencer. They might be outspoken but they’re also role modelling the type of behaviours you want within the business. I think if you get those guys on board early, they’re more likely to engage with staff and get the adoption rate happening quicker than the CEO or the owner saying everybody must do this.
Finally, there’s the review and checking in. Is the new technology doing what we set out for it to do? Are there any bugs? If there are bugs or glitches, let’s make sure we actually get those fixed very quickly. Otherwise people are very quick to stop using it.
Should we use an expert to help with implementation or can we do it ourselves?
Look, you can do it yourself and there are a lot of resources online. If you’ve got a lot of time to, first of all, spend hours and hours reading up on products and reviews and, and testing and trialing. I know we’ve all got a spare eight hours every night for that sort of stuff.
But if the question is ” is your time spent better spent doing that or something else?”
If the answer is “Something else” then get an expert in who’s does it all the time, they can do it quicker. They know the pitfalls. They have experience implementing the technology in companies similar to yours. They know how to manage the process and make it successful.
And then there’s the risks if you get it wrong.
We see it often where people ring us after they’ve made a mess of things. Especially on things like email systems and stuff where you can break the email and that’s really not good for you.
Technology makes things easier. It also makes things easier to stuff up and there’s not always an undo button.
How do we measure success?
Yeah. So once again, there’s a couple of different ways of looking at it.
Firstly, with any sort of change. I generally find it’s the implementation that’s the most painful part. The buying of the stuff pretty simple. Selection can be difficult, but the implementation has always been pain and suffering and, and I’ve recommended to a number of clients over the years that if you want something that’s going to absolutely map to your process, it’s going to be expensive. It’s going to be customised. So whenever you’re actually looking at putting in some IT, some technology, especially software, typically it will mean that you’ll need to mould your process a little bit to accommodate the way that the software works. Cause you can ask them to change it, but generally they won’t.
So, so I look at any sort of IT implementation as a real project. I’m looking at milestones, I’m looking at dates, I’m looking at, you know, things to be achieved. But the ultimate measure for me is did we meet our objective. That need that we identified all the way at the very start, has it been delivered upon? If the answer is no. Well then the answer is no. You failed. If you’ve project managed it well enough along the way, it shouldn’t be a no.
I’d like to think you actually haven’t done this project in isolation, that you’ve built it into an overall strategy for the business and so you’ve got a three to five year time scale on your overall strategy. You’ve got a budget for at least the next year and you’ve built the gains and the costs of this investment into that plan.
So having a budget, you’ve actually got something to measure against. You can see what your sales actually are compared to what you anticipated with this new technology.
You can see whether your operating efficiencies have been gained in the production area or the operations area.
You can see whether you made the staff savings. When you look at the staff cost rate relative to budget or as a percentage of revenue.
Have your cost of goods sold gone down as expected?
So you’ve got all this matching to do and if you’ve got variances, then you can actually say, well why? Why is it different? Is it some external factor or is it non-delivery on this project that we have implemented? So when you put all of them together and hopefully in the bottom line you’ve still got a net gain.
That’s the ultimate measure of the success of the project. Has your profit gone up as you anticipated?
I would look at user adoption. Having one hundred percent compliance is obviously what you’re looking for. You’re wanting all your staff to be using the new technology.
Then there’s feedback, getting employee feedback on how it’s going and what they’re thinking.
And then there is improving efficiency and quality. Has the new technology improved efficiency, output and quality?
Those are the sort of things I’d be looking for from a people perspective.
We focused all this on technology for business growth. So can we improve the business without technology?
Business has been around for a long, long time and strangely enough, we even used to do business without a mobile phone. Can you go figure?
So there is an issue that does occur from time to time where people believe that technology is the solution for everything. Whereas some basic P and L understanding some basic margin assessment, some good conversations with staff can provide you a massive improvement.
Technology is just a tool. Use it well and you get some great value. But there’s many ways of getting around it without technology. So if you believe that technology is the, you know, this panacea for all ills, I’m sorry, but that’s just not the case.
You can do a lot without technology. Just generally technology can in some circumstances make it a little bit faster. Not always better.
I would say technology is an enabler. It does speed up improvements. And the reality is that your competitors are probably using technology to improve their business. And if you’re not, if you’re not investing in technology and using that to drive profit and growth, you’re obviously going to be on the back foot. I think people do get carried away with the shiny object of “it’s going to solve all their dramas” when they may have other issues that there’s not a technology solution for.
Just building on what’s Stewart said about understanding your business better and having more P and L analysis.
With technology. You think I can have more, I can do more. Sometimes it’s not good to do more. It’s actually better if you understand your margins on your products or your services and you say actually we’re even not making money on that service (service A), all our profits are coming from service B. Why don’t we just drop service A and focus on service B. We’ll make more profit, the same level of revenue or output as you had before. So you don’t need the technology to do that. You’re just doing the same volume as it had before, but you’re making more profit.
Meet the host
CEO and Founder, Synergy48 Group
Brenda has an honours degree in organizational psychology and a Graduate Certificate in training and development and she is an experienced trainer, facilitator and counsellor. She is a firm believer in mutual collaboration combined with a practical, hands on tools, strategies and systems as the most effective way to achieve real results in business.
Brenda has over 20 years of experience training in communication, team work, time management, productivity, organisation and strategic planning in large organisations. She is also the developer of the Business Benchmarking Toolkit used by Synergy48 Group members and clients to identify areas for improvement in their business processes.
Brenda is a sought after mentor, speaker and trainer in the areas of strategic partnerships and networking with a difference. She is passionate about actively giving back to the community. In addition to donating her speaking fees and a proportion of every Synergy48 Group membership to provide microfinance to help women in Malawi to start their own businesses, Brenda has climbed the Himalayas to raise money for Kids Help Line and helped lay a pipeline to supply water to a remote village in Tanzania.