INNOVATION MASTERCLASS:Part Five: Figuring out and addressing your IT needs is an important step for any start-up business and can save you money in the long run
MOST START-UPS and small businesses want to focus on their business not technology. But in an increasingly technological world, it can end up the other way around.
"For start-up companies with a new business idea or perhaps for a company expanding a current business process, the biggest difficulty is setting up their IT so that it is reliable, user-friendly, secure and requires little input once in place," says Caitríona Lynch, managing director and founder of C Infinity.
"There is an overwhelming variety of systems and hardware available, making it difficult, potentially expensive and time consuming to set the right foundation, which allows for growth without having to reinvent the IT platform later," she says.
"All too often companies don't take the time to plan their IT because of so many other commitments, often resulting in a plethora of non-integrated or even incompatible hardware and software being added in an ad-hoc way," adds Lynch.
To avoid this, the first step in setting up is to forget about IT and to define your business requirements - which will help determine the types of systems you require - the number of people and their roles, the locations of those people, security needs, any compliance requirements and plans for growth, says Lynch.
"Once you know what you want the system to do, then you can be sure to get a system that fits your needs rather than having to reshape your business to fit the IT system," she says.
This may sound easier said than done, but that is not necessarily the case, says Claire Cunningham, a member of Chambers Ireland's digital policy council and director of Aura Internet Services in Co Monaghan. The company develops websites and provides e-business consultancy and training.
She says that help is at hand for start-ups and small companies that have taken an unorganised approach to their IT needs. Tech Check is a programme that is run through 35 city and county enterprise boards and it offers businesses an independent review of the information technology they use, to identify what improvements can make their companies more profitable.
Tech Check costs €150, which is a fraction of its commercial cost. It takes just one day for an independent consultant to analyse a company's use of technology, from hardware to software, cash registers to customer relationship management (CRM), software packages to phone systems - whatever the company is using.
The consultant then produces a brief, confidential no-nonsense report highlighting the best options to improve profitability through better use of technology. The report's integrity is guaranteed as the consultant makes recommendations, but may not sell the businesses any solutions.
"Most companies won't go seeking that advice in advance because they are concerned about the potential costs involved and whether the advice is impartial. But the likes of Tech Check provide an avenue for smaller companies starting up because that's its remit - to advise you impartially on your IT needs," says Cunningham.
An IT setup consists of three main components: software, such as word processing, spreadsheet and accounts; the internet, which includes a web presence and e-mail; and hardware such as laptops, desktops and servers to run these applications.
All of these components can be expensive, with individual computers costing from approximately €500, productivity programs - word processing and spreadsheets for example - costing up to €500 per computer and specialised CRM software costing up to €1,000 per user, according to Lynch.
In addition there are network security and firewall issues to be addressed, she says.
With an estimated 30 per cent of businesses in Ireland still using manual methods of book-keeping - which eats into management time - Cunningham advises start-ups to get computerised accounting and payroll management systems in place as a key first step.
Recent innovations including Software as a Service (SaaS) systems have certainly reduced the start-up costs as this software allows an ongoing monthly rental to be paid rather than a large initial outlay at a time when cash flow is an issue, says Lynch whose company provides a SaaS service.
"With no initial outlay companies can avail of state-of-the-art backup facilities, have access to a fully customisable server which is fully monitored in a top-class data centre and have complete encryption on all the company computers giving complete ease of mind.
"Such services are automatically upgraded so you never have to reinvest in upgrades, system replacements or worry about the hardware environment or the security," she says.
Both Lynch and Cunningham advise start-ups to pay particular attention to the licensing of software applications.
Software licensing has got more sophisticated to counteract piracy, says Cunningham.
"The regulations in this area are increasing and the fines are huge," agrees Lynch.
"With directors liable for licence breaches it is very important to constantly check all your machines to ensure there are no unlicensed products running on them."
Users of unlicensed products may also find it impossible to upgrade later on, causing problems for the business as it expands, says Cunningham.
A 2005 survey by Chambers Ireland found that only 56 per cent of Irish small to medium enterprises had a website and only 29 per cent used e-business options to order, sell or accept payments online.
"I cannot understand how a company can seriously be promoting, marketing or selling without having a website," says Cunningham.
"Most businesses have access to a PC and will research you before they buy your product or avail of your service and they will do that research by looking up your website," she says. However, she cautions that a poorly designed website can be worse than none at all.
"It is the same as any public front for your business," she says.
"A website that isn't doing you any justice, can do you more harm than good."
