Viewing archives for Bespoke software problems

Does your business run on Excel? Undo!

One of the UK’s leading health agencies, Public Health England (PHE), has revealed a massive under-reporting of covid-19 cases due to an Excel blunder.

The truth is that many mid-market CEOs know their own businesses are too dependent on Excel. We’ve all become stuck in an Excel circular reference. The challenge is how to escape. Excel has become ubiquitous for a reason. It is extremely simple to start and amazing what you can do quickly.

But for some mid-market businesses, Excel has become an unplanned core back-office system. It is often the link between systems and processes; it is sometimes used to store critical data; and it is often used to present and explore data throughout the business.

Finance people can’t get enough of it. The rest of us can’t remember the clever bits, but we still use it anyway.

But why is it dangerous?

  1. Excel is fundamentally unstructured and easy to change. This makes it incredibly convenient. But it also allows for continuous tinkering. And it can be very difficult to assess the impact of changes and to identify errors.
  2. Excel files, passed between people by email, or shared in folders (or worse on USB sticks!) are a recipe for error, confusion and unauthorised access. Good systems go hand-in-hand with good processes, and Excel encourages neither.
  3. Excel is a dead-end. There is no ‘pathway’ to formalise an Excel process into a more managed system with proper controls, an audit trail, security, data management and error-checking. Excel is not a sound basis for automation or integration.

In the meantime, see our ERP and integration knowledge centre for more on smoothing out systems and processes


In short, Excel can lead a mid-market business to the point where it is very difficult to scale and where they are exposed to fraud or blunders like PHE’s. But since it works most of the time, and the cost of replacement looks high, the easiest thing is just to carry on with it.

But the bottom line is that to run a business well you need integrated systems that support efficient, agile processes, and deliver useful management information to enable decision making. You won’t get all that with Excel.

Your company’s systems strategy should have some principles to avoid an overdependence on Excel. What might they be?

  1. Use Excel freely – when it’s appropriate. For example, new ideas, new opportunities, or an informal look at data. Use Excel as a personal tool for tackling problems.
  2. Establish your business’s timeframe or scale-of-use for Excel. For example, ‘We won’t use Excel to manage this project for more than nine months.’ Or: ‘It wouldn’t make sense to run a new business line on Excel once revenue exceeds £100k per month.’ Or: ‘We always ring alarm-bells when someone starts using Excel’s built-in coding platform’.
  3. Here’s the tricky part: you need an integrated set of systems and processes that can smoothly replace Excel when the time comes.

Excel is an amazing product; it is ubiquitous for a reason. But its convenience can be its downfall or yours. Like all powerful tools, handle it with care!

If your company needs help replacing Excel with an affordable integrated system, get in touch. We have a lot of experience helping mid-market businesses streamline their systems, and we’re always up for an informal chat.

Freeman Clarke is the UK’s largest and most experienced team of part-time (we call it “fractional”) IT leaders. We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

Transform Your Business and Increase Revenue Using Custom Software

About a quarter of our clients are ambitious mid-market companies who want our help to manage and drive custom software development either for internal systems or for ecommerce and revenue-generating phone apps or web apps. Sometimes they are struggling to get started, sometimes they are well underway but having all kinds of problems. Technical, commercial, people problems that can be very time consuming and energy sapping.

Custom software done well can be worth a huge amount of money and can significantly transform the value of a business. If it were easy then everyone would do it. That’s the fact! But why is it hard and how do you get it right …?

This short video explains why businesses should look to implement custom software projects to increase revenue and competitive edge.

Over the coming weeks we are creating a series of content pieces about CTOs, their role, how to find and recruit  them and the invaluable benefits they provide to a business. All of which can be found on our CTO Knowledge Centre page here.

Freeman Clarke is the UK’s largest and most experienced team of part-time (we call it “fractional”) IT leaders. We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

Manufacturing – Part 3: Getting Data Right

Getting Data Right is a Critical Commercial Issue for Manufacturing Businesses

We meet many manufacturing CEOs who are frustrated that, despite spending huge sums on new systems, they are still unable to get visibility of the true cost of production, have higher than expected waste and no clear view of inventory on hand or on-order.

New systems like IFS, Nav, AX or Dynamics 365, SAP, Sage, Epicor, Oracle or Syspro can cost huge sums, but if the project fails to deliver often the root cause is that the master data in the system is wrong. For example product costings, Bill of Materials, Recipes, routings, etc may have not been setup correctly in the first place or may have become out of date. The tech may be fine (though often it isn’t!) but if the data is wrong then everything else is “built on sand”.

Poorly controlled master data confuses everything – same customers, FG’s (finished goods) or RM’s (raw materials) entered multiple times but called different things. And the bigger and more distributed the company, the more this can happen. Reports are wrong or time-consuming to fix; customers are upset by incorrect, incomplete or late delivery; procurement over-order to create safety stocks; sales can’t accurately forecast delivery dates; labels or documents may be wrong which can be inconvenient or, more seriously, can have legal or safety implications.

Fundamentally, poor data can make it hard to take advantage of efficiencies of scale. New systems are rolled out but problems remain and a growing business becomes less profitable rather than more profitable.

What are the root causes and real solutions?

1. Strong leadership or ownership.

Data is difficult, detailed and, let’s be honest, it’s not very interesting. Solution vendors are contracted to deliver some tech, so they don’t really care. Everyone’s too busy doing their day job so it may get left to the Finance or IT teams to sort it out, and they may not have the knowledge to fix issues or the authority to get people to change bad habits?

This issue has strategic implications so a Board-level leader needs to take ownership. The individual needs to have time to get to the bottom of the issues, experience of this kind of work, and authority to make decisions and get things done.

2. A complete strategy and solution.

Data problems often reflect process problems, or lack of alignment between people and departments. It may not be clear internally who is responsible for what, for updating data as things change, for correcting data if errors are found. Perhaps this kind of thing falls to some very over-stretched helpful people – and Directors wonder what they’re doing all day. There may be no-one who has time to get to the bottom of what goes on and why.

Sales, finance and production teams’ reports simply won’t agree if they are working from different base information, but they may have good reason for this and fixing the problem may require process changes, technology changes and some retraining (or even “redeployment” if the real issue is particular people!)

We often see data issues resulting from multiple systems being used but there may be good reasons for this. For example, specialist warehouse management solutions are often used as they integrate with advanced technology such as voice or sight picking which isn’t supported by basic ERP platform. But if you have separate systems there needs to be clarity around as to which system owns what data (eg ERP owns stock quantities, WHM owns stock location) and interfaces need to be complete, tested and working.

Overall the architecture of the processes, systems, and data needs to be clear, simple, well structured and then well implemented. Processes and data standard need to be defined and enforced. These activities need to be monitored and corrected when necessary.

3. Long-termism and commercial realism!

Data issues often arise because lack of time and commercial pressures mean that shortcuts are necessary. Getting data right may be a matter of diminishing returns as obscure problems can be very difficult and time-consuming to fix, and they may just not worth it!

The most important thing is to make considered and rational decisions. List the data problems, estimate the necessary effort for each, and the business impact. If short-term pressures mean that a problem won’t be fixed now, then perhaps it’s on the list for next month. The impact of these data problems can be monitored and, when time allows, further progress can be made.

Deciding to tolerate a problem for now is not the same as ignoring it or sweeping it under the carpet!

Even poor systems can work effectively if the data is well structured, well maintained and well policed. And, most importantly, this is a good platform for system improvements. Well structured data can eliminate a whole range of problems and inefficiencies, can boost profitability and give everyone new energy as less time is wasted on distractions and snags.

You may also like to read the additional content on our Manufacturing series:

Manufacturing – Part 2: Board checklist for successful ERP projects.

Manufacturing – Part 1: The impact of the Internet of Things.

Freeman Clarke is the UK’s largest and most experienced team of IT leaders and we frequently work with manufacturing clients to help them deliver transformational programs of improvement and system efficiency. We are entirely independent of any technology or suppliers.

We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

 

Manufacturing – Part 2: Board Checklist for Successful ERP Projects

Manufacturing companies’ internal efficiency and effectiveness are highly reliant on sound ERP systems. But all too often we meet CEOs whose systems just tie them in knots, add cost and hamper customer service! These systems become a brake on expansion and growth.

Manufacturing companies embark on ERP projects, often expensive exercises, but the results are often disappointing and rarely meet their business objectives. How can you avoid this?
This Board Checklist provides some key pointers. It can be a useful review even if you’re half way through, or primer if you’re about to start.

1. Get the business objectives clear. Has there been an open workshop at Board level to agree the basic business objectives? The objective isn’t to implement a new ERP, it’s to deliver some specific business outcomes… what are these? Is everyone agreed? For example the objective might be to halve manufacturing cycle/throughput time; to remove 4 FTEs by avoiding any rekeying between the ERP and website; or to eliminate errors in labelling by automation of label production.

2. What are key requirements? Document in everyday business language the key things the systems must do, or must enable or must achieve. This might be a list of 40 or 50 statements, for example, “Telesales handling staff can see accurate stock info and pricing on any products within 30 secs.”. Often the emphasis is on how you go about things today but the focus should be on outcomes as there may be better ways to get there. All the heads of departments need to be involved, need to agree and sign off (yes, put ink on the paper!)

3. Who is involved and who is accountable? Who on the Board is accountable for delivery? This should include not only delivery of the technology, but all the business outcomes identified at the start. Are there experts on the business who will need to be assigned to the project team? Will they need to be backfilled? Everyone must be clear on their roles. Are you aiming to involve some of your own people in the details so they can become expert superusers?

4. Get clear on the cost/benefit model. Although you don’t know the detailed costs yet you can establish the cost/benefit model. This means understanding how this project will deliver hard benefits so that, when compromises are necessary, you can identify what’s worth keeping and what you can afford to drop. The cost/benefit should be based on improvements in KPIs, for example, identify the target OTIF (On time in full) and compare to current measurements of the same KPIs.

5. Rational Product(s) selection. There are hundreds of systems available: IFS, Nav, AX, SAP, SAGE, Epicor, Oracle, Syspro to name a few! This is a minefield, but using the requirements already agreed you can create selection criteria, a scoring system and clear questions to ask, rather than just being seduced by great salesman. You need to weigh up the advantages of integrated ERP with multiple specialised systems, which might offer better features but greater complexity. For example it can make sense to select a standard ERP and a specialist warehousing product for better goods handling (picking, putaways etc). Make sure all the business stakeholders are part of the decision-making process so they all have a vested interest in success.

6. Rational Partner(s) selection. A partner will configure, customise and support your systems. As you will need to have a long-term relationship it is critical that there is a good cultural fit and trust. Take up references, and check everything! Are they experts in your sector, are they financially secure, have they got a stable team. Ensure you have time to negotiate a good price and contract rather than having to cave in due to pressing deadlines.

7. A credible & complete plan. The vendor or implementation partner needs to provide you with a credible plan and you need to extend this with your own plans for things like communication, data setup and retraining. Most importantly, the plan needs to show all activities to deliver the business objectives, not just delivery of the tech, and should span all the resources and commitments not just the supplier.

8. Define target business processes. Working with the implementation partner you need to design your target processes. Many ERP projects fail because companies try to configure new software to match the way they always have worked. This often leads to expensive bespoking and, if the implementation partner is charging for this, then their salesman will be delighted to help you make bad decisions!

9. Process and organisational changes. With new systems, come new ways of working. These need to be planned, documented and rolled out carefully with plentiful and personal communication to everyone affected. This will not happen by accident; without proper management many people will go to great lengths not to change how they work!

10. Data migration, cleansing & setup. Getting the data right can be make or break for a new system. This task can be the biggest part of the project and may be the most critical. Take the opportunity to clean data and improve its accuracy, after all one of the key benefits of an ERP is the information it can provide the business to help advise decision making. If the data is poor and inaccurate today that won’t change tomorrow unless effort is put in to improve it. Think about product codes and bills of material and how they can best be structured to deliver the information the business needs. Start cleaning today and don’t wait till the point of go live. Experience tells us that the point of go live all too often results in taking inaccurate and unclean data across to the new system!

11. Device integration. Where shopfloor, in-vehicle or other devices are to be integrated with the systems then this needs to be implemented and tested, probably in collaboration with device suppliers. For example, scales, environmental sensors, barcode scanners, or RFID trackers are increasingly key sources of efficiency so shouldn’t be an after-thought – device integration should be carefully planned, managed and tested. Are the devices suitable for the environment… think about temperature, humidity, vibration etc.

12. Testing and conference room pilot. By making the vendor run their product through your business processes you can check the system and business practices will fit together and the key staff are ready for change. It’s a great way to get superusers onto the system; it may also be an opportunity to identify additional benefits that weren’t thought of at the beginning … or a last chance to spot unforeseen problems!

13. Implementation/Cutover/Go-live. A ‘big bang’ go live can be complicated and risky; different parts of the new system may be ready at different times; and different phases will deliver different benefits. So there will normally be a progressive adoption of the new system(s) and decommissioning of the old ones. This needs to be thought through and carefully managed.

14. Training and monitoring. Staff will need training and coaching in how to work with new processes, systems and roles. There may be a period of de-snagging and minor amendments. This needs careful monitoring and policing to ensure that employees have clear ways of working and do not adopt bad habits. For many staff this change is daunting and where this means doing their jobs differently it can cause stress and resentment, and when they don’t yet fully understand the new way of working they may blame the system for mistakes or processes that are taking longer due to the unfamiliarity.

15. Review and ongoing ownership. The project owners need to ensure the original business objectives and cost benefits materialise. But this is the moment when the new system becomes “legacy” so it’s critical than ongoing ownership is clear. Ongoing monitoring must be part of the routine and new issues must be addressed quickly and without a fuss. There needs to be an annual budget for vendor support, for training of new staff, for fixes, and for amendments so the system continues to remain aligned as working practices and products change (as they inevitably will).

All too often we see lack of focus on these key points and, as a result, the projects can become bogged down and overrun both costs and timescales. Eventually there is a dash to finish… the original vision gets relegated and the aim becomes to “just get it done”!

But the benefits delivered by new ERP systems can be transformational when the project is conducted well. Many of our clients have achieved significant uplift in efficiency and service and find new confidence to grow because their business starts to feel like a platform for scaling up! When system issues are no longer on the agenda the Board have more time to talk about strategy and growth. And effective systems provide data and reports to feed into those strategy and growth conversations.

You may also like to read the additional content on our Manufacturing series:

Manufacturing – Part 3: Getting data right.

Manufacturing – Part 1: The impact of the Internet of Things.

Freeman Clarke is the UK’s largest and most experienced team of IT leaders and we frequently work with manufacturing clients to help them deliver transformational programs of improvement and system efficiency. We are entirely independent of any technology or suppliers.

We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

 

A Strategy for Solving Systems Integration Problems

For many businesses, systems that don’t work together are the source of major headaches.

Systems that don’t talk to each other create layers of manual work, errors and issues, and make reporting difficult or impossible.

Over time individuals create workarounds and ways to bypass these problems. So their own ways of working become complicated, inefficient and fragmented. Not only does this affect the bottom line, but frequently it affects the morale and ambition of the whole company.

Solving these kinds of problems is really hard because there are really complicated! Getting to the root of the issues can be exhausting; trying to solve them feels like wading through treacle.

Busy directors just don’t have time for this.

So where do you start?
First decide on your strategy by getting the Board together and answering these 3 questions:

1. Ambition – how much do you intend to grow and change the business in the coming years; do you need a platform for growth and acquisition, or can you continue to cope?

2. Resources – are you prepared to invest significant resources in projects, or would you rather minimise change and try to tackle problems piecemeal?

3. Impact – how much is this really affecting (or in danger of affecting) the business commercials? Is there a major opportunity to reinvent your business, or just an opportunity to remove some irritations?

The approach may be a dedicated project to address a range of specific issues and to solve them each individually. Or it may be that major replacement projects are needed.

Technology may be the easy bit
But, whatever the approach, the solution will probably require a combination of technical changes, changes to processes, organization, roles and incentives. There may be difficult conversations and the need to call out people who are personally contributing to these issues.

This discussion can be stormy because systems that don’t integrate often reflect departments or Directors who don’t integrate!

Building a unified consensus around the Board table is the crucial first step. There needs to be a senior member of the team who has time, focus and authority to get to the bottom of these issues and to lead the changes.

We have also created a more detailed CEO’s Briefing on how to address these kinds of integration challenges which you can download  below.

Freeman Clarke is the UK’s largest and most experienced team of part-time (we call it “fractional”) IT directors, CIOs and CTOs. We work exclusively with SME and mid-market organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

Manufacturing – Part 1: The Impact of the Internet of Things

The impact of the Internet of Things on manufacturing is often talked about, but as ever, IT companies like to baffle the market with new buzzwords and to spread fear and uncertainty!

We read about the Industrial Internet, Industry 4.0 and smart factories. What’s really going on?

In simple terms this is all about using technology on the production line that incorporates sensors and controllers to make the production activity more visible, smarter and controlled in real-time.

More visibility means your own staff can deal with customer requirements more accurately, manage stocks, ordering and production to minimise costs, maximise output and quality.

Rather than basing this on manually created reports a week or a month old; devices and sensors are integrated into ERP systems to provide up to the minute information accurately, with minimal manual intervention.

Of course, it’s not a huge step from here to introduce automation for some aspects of decision-making. This can be a structure of simple rules – it doesn’t have to be rocket science. Or it can be sophisticated machine learning and Artificial Intelligence.

If production information is available internally then it can be made available externally.

Customer expectations across all industries are being reset by people’s own domestic experience of ecommerce – your customers will increasingly expect to be able to see and assess the progress of their own orders through your factory. Integration of your production activities with your customers, suppliers and partners becomes possible at a far more detailed level.

Perhaps the greatest opportunities are to continue to monitor and communicate with your products after they have been shipped and are in use. This enables new models for maintenance, support and entirely new opportunities for value-added services.

3D printing will have a revolutionary effect on many aspects of manufacturing in the future. Rapid prototyping and iteration are already becoming the norm, but the real revolutions will be in mass customisation where customer expectations will undergo major change in the coming years. Endless product versions and variations will become the common place.

Equally significantly, 3D printing will massively reduce the need for stock holding, especially for spares, which will free up cash. This may have a transformative effect on smaller companies and their ability to invest in these new trends.

At a macro-level, these changes will all reduce labour costs which will reduce the attractiveness of low-cost economies, reduce economies of scale, and will enable a return to local manufacturing. We believe that ambitious mid-sized businesses will find huge opportunities in this change.

Finally, it’s worth noting that these trends towards local manufacture are forecast to reverse decades (or centuries) of growth in global trade of manufactured goods. A recent ING report estimated a reduction in world trade by as much as 40% by 2040! This will affect a wide range of industries from shipping to insurance, and may have very broad-ranging geopolitical ramifications as well. It won’t be the first time that manufacturing has changed the world!

You may also like to read the additional content on the Manufacturing series:

Manufacturing – Part 2: Board checklist for successful ERP projects.

Manufacturing – Part 3: Getting data right.

Freeman Clarke is the UK’s largest and most experienced team of IT leaders and we frequently work with manufacturing clients to help them deliver transformational programs of improvement and system efficiency. We are entirely independent of any technology or suppliers.

We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

 

CEO’s 15 Step Guide to Bespoke Software Development

Click on the download button for our full CEO’s briefing on overcoming bespoke software problems or read our short 15 step guide below:

Around a quarter of our clients approach us because they have problems managing bespoke software development or because they are not able to effectively kick off a bespoke software project in a managed way.

These situations can become money pits and a huge waste of time. They can also be a source of great angst and disappointment – we’re often struck by just how exhausting software development can become for CEO’s of mid-market businesses.

Bespoke software offers great opportunities
Bespoke software allows you to create something unique and thus to create real value. It offers the opportunity to build genuine competitive advantage, for example, to radically alter how you work internally, to massively reduce costs, increase performance and hugely improve customer service.

If you want to outperform your competitors by working differently, or if you want to interact with your customer, partners or suppliers on the web in ways that are noticeably better than your competitors then off the shelf software is unlikely to hit the mark.

Furthermore bespoke software may allow you to create products you then license to your own customers to create entirely new revenue streams and differentiate yourself. This can radically reposition a business and substantially change its valuation multiple.

The typical, painful scenarios…
We typically see software which has become unreliable, slow and maybe difficult to fix or can’t be relied on. Sometimes there are issues with developers, either internal or a difficult relationship with an external company.

The vision and plan might make sense to the developers but it doesn’t make sense to the Board and is not rooted in the business strategy. There just doesn’t seem to be someone sensible to have a proper commercial conversation with. Sometimes there are legal and contractual issues as well.
We meet CEOs concerned by the possibility of software issues causing major commercial damage and it may not be clear how to even start sorting the mess out.

The common feature is that often the Board are frustrated with the developers, and (guess what!) the feeling is mutual! The root cause is that software development is complicated, time-consuming to understand and often goes wrong. This can quickly erode the Board’s confidence and lead to broken relationships.

So the question is how to avoid these situations and how to deal with them if they arise?

1. Get everyone clear on the vision for the business opportunity and business objectives. In business terms, why is this software worth having? That’s not the same question as what functionality do we want; the question here is why do we want the software at all.

2. Very simply establish what the software needs to do to fulfil these business objectives. Is it also clear how the software needs to do this (ie the non-functional requirements)?

3. Identify everything needed other than the software to fulfil the business objectives. For example, process improvements, organizational changes, training, marketing strategies, launch plans. Make sure all these have owners.

4. Get an expert technical director. An IT director understands what needs to be done, the options, upsides and downsides. An expert is needed to find creative solutions, to push through solutions and navigate compromises. For larger commercial product development we provide a Chief Technology Officer (CTO).

5. Get an expert day to day manager. Good development relies on having sound tools for programming, testing, management of the code and technical environments and automating technical processes, and good management of documentation and tracking issues and versions.

6. Choose standard products and tools. You need to be able to find developers and support companies for years to come. Stick with mainstream products and approaches.

7. Outsource if you want to contain cost and risk, move quickly, pin down a supplier to a contract, benefit from offshore rates and rely on someone else to recruit great people.

8. Insource if you want to bring creativity and talent into your business, build up software development capability as a core part of your team, and aim to experiment and innovate as you go.

9. Get the legals sorted. Are you paying fixed price? Do you own the software, are you just licensed to use it? Are the tools and frameworks licensed? Is it clear who owns data and other “know how”?

10. Have a simple, clear management approach and make sure it’s understood by all. If you want to get something live quickly, you trust the developers, and you’re happy to engage and explore then an agile approach might work. If you want to pin down all the details and minimize your risk before you start then you probably favour a waterfall approach.

11. Keep the objectives in view and move quickly. The only software that has any value is software that’s live and delivering business benefits. So focus on the “minimum viable product”, get working software live quickly, and then consider alternatives and improvements from there.

12. Make time for testing. Developer’s testing will never reflect real use so you will then have to organize detailed and systematic testing before the software is ready to go live.

13. Even after go-live ensure you have rapid access to developers who can understand and fix problems properly, rather than just paper over cracks. If you are following an agile approach you may have gone live with a bare minimum initially and there will be a continual flow of enhancements for the foreseeable future. Don’t bodge the software, this will always come back to haunt you.

14. Ensure there is adequate documentation. Creating documentation can become an industry in itself without any real value, but having basic documentation in place is critical for long-term viability of any software.

15. Don’t expect it to be easy. If it were easy everyone would be doing it!

Hard to do well, but worth it…
A well managed and maintained bespoke software can be a huge business boost. It can create unique points of difference for your business and allow you to charge premium prices. It can allow you to automate and scale up where more manual business are failing, and it can allow you to innovate beyond the capabilities of off the shelf software.

Because getting bespoke software right is so hard, it can create huge barriers for your competitors. And because few organisations do it well, it will be reflected in the value of your business.

You can read more information about Bespoke Software here, or view our video.

Freeman Clarke is the UK’s largest and most experienced team of part-time (we call it “fractional”) IT directors, CIOs and CTOs. We work exclusively with SME and mid-market organisations and we frequently help our use IT to beat their competition. Click Contact Us  and we’ll be in touch for an informal conversation.

6 Common IT Budget Blunders

1. No agreed IT strategy or plans
No IT strategy means “the IT guys” will come up with a new way to spend money every week. And no clear plans means that everything is an unwelcome surprise. The IT team won’t know how to explain why something is worth investing in. It feels like they’re going off in the wrong direction because there is no agreed direction.

2. Allowing suppliers to tell you what you need
Given the opportunity, your suppliers will be very happy to tell you what you need – and they will make a great argument! They have things to sell and targets to meet! Don’t talk to suppliers without understanding what you want to achieve and why you’re talking to them. Shop around. If it’s a serious decision then organise a serious tender process based on what you need, rather than what they want to sell you.

3. Overrunning Projects
A seriously overrunning project can torpedo your IT budget. And the most common causes of overrunning projects are companies who buy products they don’t fully understand; suppliers who don’t have the capabilities they claim; and projects that lack direction and aren’t adequately managed.

4. Just renewing a contract because it’s the easiest thing to do
There’s value to be had in doing a benchmark exercise if nothing else. Look around, talk to some other companies. There may be lengthy notice periods so start the renewal process early enough that you have time to consider alternatives without missing the deadlines. Let the supplier know that you’re doing that. Prices will tumble, service levels will improve. Just renewing means the supplier is only making more profit from you, nothing more.

5. Buying products you don’t need or can’t use.
We see plenty of clients who’ve spent money on things they don’t use. Amazing but true! If you’re buying something make sure you understand the value it will deliver, make sure you understand the full effort and cost necessary to deliver that value, and make sure a senior member of the team is on the hook to deliver this entire journey.

6. Not agreeing service levels and key performance indicators
Spending money without checking you get what you’ve paid for is just bad business. All IT services, whether they are insourced or outsourced need to be monitored and a simple set of KPIs should be the main dashboard. You must define what you want in terms of service levels and KPIs and, for external suppliers, bake this in to the contract.

Finally, remember that you can bring IT costs under control, but that doesn’t means much if your IT isn’t delivering real value and contributing to your business objectives.

Freeman Clarke is the UK’s largest and most experienced team of part-time (we call it “fractional”) IT leaders. We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

5 Steps to Get Your IT Budget Under Control

We meet some companies who are constantly banging their heads against a brick wall when it comes to their IT budgets. For them, IT spending feels unplanned, unwelcome and unproductive. The Board are frustrated and (guess what!) the IT team is frustrated as well! It feels like money is spent on the wrong things and IT rarely seems to deliver.

Here are 5 steps to get this situation under control.

1. Who’s on the Hook?
Serious businesses spend serious amounts of money on IT. A competent member of the senior team needs to understand the IT budget in detail, needs to take accountability for it and own its successful delivery. Too often, no-one around the Board table is really able to say for sure you’re not wasting money; not being ripped off by suppliers; but not under-investing either.

2. What’s the Strategy and ROI?
IT expenditure needs to be justified in terms of alignment with strategy and return on investment. In order to do this there needs to be a strategy and there needs to be a plan! All IT projects need to be mapped to business objectives; they need to be fully costed and efficiency savings or sales uplifts identified to allow sensible commercial decision-making.

3. What’s Normal?
Getting budgets under control is much easier when there is a consensus about what’s normal. Average spending on IT varies between sectors, company size, and other factors and benchmarking yourself against these averages can help create a consensus around what is normal and what your level of IT spend could and should be.

4. What’s Your Insource/outsource Strategy?
Outsourcing can be a good way to rationalise IT and save money but too often companies outsource the wrong things. Which aspects of IT are just commodities and which are core aspects of your business value? If you are making serious outsourcing decisions then go through a proper tendering process. And when you are keeping IT functions in house make sure the senior team are able and committed to managing them well.

5. Refresh & replace
Old kit needs replacing. It becomes unreliable, expensive to maintain and incompatible. You can pretend that’s not true, but then you will suffer these problems and have unbudgeted and unwelcome shock spends. Or you can agree a replacement policy and budget and plan on that basis. Setting and agreeing refresh and replace policies allows these decisions to become routine and budgeted well in advance. So these conversations no longer need to take up much time, and this creates time and energy to have proper discussions about how IT can really make a difference to the business.

Freeman Clarke is the UK’s largest and most experienced team of part-time (we call it “fractional”) IT leaders. We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

When IT “Just Works” Incredible Things Happen!

When IT runs smoothly conversations become about things that matter – things that make a real difference to your business. Your team can start to ask how can IT help us operate more efficiently? how can IT improve our customer retention? how can IT increase our sales? how can IT help us do more online?

A means to the end

Do you see your management team spending time on meetings about anitvirus software, phone replacements, license renewals and software versions? Nobody wants to waste time or money on IT, but we need technology to get our business to where we want it to be. It’s a means to the end.

Making technology work for your business

IT staff and suppliers need 4 things to get IT working for your business.

1. A clear IT vision and roadmap.
A clear vision and roadmap means people are working on the right things. Budgets and plans can be set and agreed easily, enthusiasm builds as everyone knows what they’re doing any why. Success creates further momentum.

2. The skills to get the technology right.
Despite the importance of IT, anyone can claim to be an expert. Over-promising and under-delivering is almost normal in IT. Everyone involved in IT infrastructure, line of business systems and digital need the basic IT skills to do their job well.

3. The tools to work efficiently.
Even the best people can’t be successful if they don’t have the tools and equipment, whether it’s hardware or software. Often the reason they don’t is because they haven’t been able to properly explain to decision-makers what they want and why it will make a difference. See point 1 about a clear vision and roadmap!

4. The attitude to make a difference and to learn from mistakes.
IT is complicated and things go wrong, even the most hardened business leaders understand that. But people need the attitude to understand and learn from mistakes otherwise they are doomed to repeat them! IT people need to understand what the business is really all about and what matters to its customers. The entire IT team need to be committed to finding ways to say “yes”.

Find out more

We frequently meet businesses wasting time on technology (the means) and failing to get the business benefit (the end). But if you address the 4 fundamentals then you can stop worrying and begin the conversations that matter. Conversations that will help your business thrive.

If you’d like to talk to us about the 4 fundamentals then please get in touch.

Freeman Clarke is the UK’s largest and most experienced team of part-time (we call it “fractional”) IT leaders. We work exclusively with ambitious organisations and we frequently help our clients use IT to beat their competition. Contact Us and we’ll be in touch for an informal conversation.

Subscribe to our Business Insights

Plain English board-level briefings focused on technology strategies to deliver competitive advantage and business success.

* Please enter an email address
newnewsletterrecipient

You can unsubscribe at any time.

Thank you.

You’ll now receive regular expert business insights.

Call us on 0203 020 1864 with any questions.

Graeme Freeman
Co-Founder and Director

Subscribe to our Business Insights

Plain English board-level briefings focused on technology strategies to deliver competitive advantage and business success.

* Please enter an email address
newnewsletterrecipient

You can unsubscribe at any time.

Thank you.

You’ll now receive regular expert business insights.

Call us on 0203 020 1864 with any questions.