Microsoft icon Bill Gates runs a successful computer software company without needing to know the details of how General Mills manufactures cake mixes or how Northwest Airlines schedules flights. But ain’t it the truth that CEOs of General Mills, Northwest Airlines — indeed the majority of corporate leaders big and small — almost completely depend on Gates’ wares to run their own companies?
Choosing an IT Consulting Firm
Without hardware, software, Web access, and other computer-related technology, many businesses would be dead in the water. Companies of all sizes can rely on a battalion of consultants to help keep everything running smoothly.
Computer consultants also help businesses choose technology that best fits their business goals, which is helpful, in particular, for small companies that can’t afford to be outfitted with superfluous expensive devices.
Thousands of American companies each day work with some type of technology consultant. To their clients, consultants provide a bird’s eye view of the technology marketplace, and of all the products that are available now and in the near future. After all, most CEOs of growing companies don’t have the time or energy to bone up on the latest and greatest technology.
Consulting firms are rarely one-size-fits-all, and their products and services vary widely. Also, many fill a very specific niche, choosing clientele in a particular industry. Solonis, based in Minneapolis, creates software, and works exclusively with mid-market banks and credit unions.
InSite Group provides strategic application support and Web solutions to manufacturing and distribution companies.
St. Paul-based In-Sight Solutions has designed software for countries and companies alike. In 2003, employees were sent to Afghanistan to help build software for the post-Taliban judicial system.
Specialization allows consultants to serve their clients better, says William Cavanaugh, Solonis CEO. “We have a pretty good idea of what their needs are based on really knowing and understanding this vertical industry,” he says. “As such, we can have intelligent, business-level conversations.”
Many meetings
Not that there isn’t any elbow grease involved when working with a client. Before embarking on a project, many technology consultants spend hours, days, often weeks, getting to know a business from the inside-out. That involves many, many meetings with company leaders.
Often, the CEO is the main contact and collaborator for projects. As Brian Strojny, president of InSite Group, points out, the most logical main contact — the IT manager — is often rendered unavailable by so many day-to-day issues.
Some consultants call this initial phase “current state analysis,” which, of course, takes longer for larger, more complex companies. Throughout the entire process, consultants should stay mindful of a company’s budget constraints, they say.
At Agiliti, a St. Paul-based IT solutions provider, consultants go through many steps to understand a client’s needs. There are “a lot of interviews, some discovery work, digging through records, recent documentation, some analysis of network traffic,” says Dave Walstad, Agiliti sales and marketing vice president. “And then the whole creation of the report back to the business owner, who would then make decisions about where to invest.”
“A good consultant will take the time to understand the business, both on the front-end and back-end,” says Jim Kelly, managing director of Genesis 10, a large technology consulting firm based on New York, with a local office in Woodbury. On the front end, a consultant needs to understand strategy, sales, marketing, the product mix, advertising, and the company’s one-year, three-year and five-year goals, he says. On the back end, business processes, support staff, short- and long-term support needs, policies and procedures, and existing technology are all entered into the equation.
After this getting-to-know-you stage has ended, consultants typically draw up a technology plan that maps out what technology changes will be required over the next few years. Genesis 10, for example, develops a two-year plan. InSite Group develops three-year plans for clients.
In each plan, the company’s key technology areas are identified for improvement. InSite Group, for example, highlights in its reports such areas as accounting software, sales management software, intranets and extranets, e-commerce and Web sites, shipping and warehouse solutions, and network, hardware and PC infrastructure.
“We ask the question, ‘What are you doing today in these areas?’ ” says Strojny, “and then work with them to deploy new solutions or integrate what they have.” He adds, “work with a technology consultant that is proactive and makes recommendations, rather than just reacts to problems.”
Follow-through is achieved by first creating a “migration plan” to identify the timing and sequencing of technology changes, says Kelly. Understanding that businesses are like tapestries — pull one thread and the whole weaving could come undone — good consultants make changes gradually, without compromising the business as a whole.
Good consultants are also flexible, offering choices below, at, and above a company’s budget. Picking the least expensive package doesn’t necessarily mean you’re selling your business short. “It’s very much like buying a car with fewer bells and whistles and a smaller engine,” says Kelly. “You are getting the same car, which has fewer parts and features that can break and need repair. It gets you to where you are going, and with better gas mileage. Don’t implement technology for technology’s sake.”
Rent it instead?
At the end of the consulting process, many client companies buy their hardware, software, IT capability, and so on. But some are cutting costs by renting, or outsourcing the technology, instead. It’s a new trend, called utility computing. Companies purchase just what they need rather than purchasing ahead of the demand curve, says Walstad. His company, Agiliti, provides utility computing to a number of its clients. Another local company, Eagan-based Orbit Systems, also specializes in it.
Walstad uses the example of a small e-commerce company that’s heavily reliant on the Internet. Such a company would have to purchase a number of different servers, software, and other components, as well as the labor of several consultants, to build the application. The tab for such an undertaking may run in the hundreds of thousands of dollars, if not millions of dollars, he says.
But what if, instead, “You were able to go to a service provider and just rent that capability? You might be able to pay $10,000 a month for the next X number of months, so you don’t have that huge spike in capital expenditures.”
Downsides of utility computing are the typical ones associated with any kind of outsourcing: loss of control, to a degree, and a security concern around using an external provider.
But advocates say utility computing saves companies money, or at least spreads expenses out over a longer, more predictable, period of time. And it involves less risk.
When purchasing technology, “You have to pick the right horse,” says Walstad. Once an investment is made, a company is stuck with it, for better or worse. “It’s your problem.”
On the other hand, “If you’re renting that, and you decide to change technologies, it’s the supplier’s problem.” Indeed, many big suppliers of hardware, including IBM, Hewlett-Packard, Sun, Oracle, Microsoft, “They all have a program” that’s pushing utility computing into the marketplace.
This is all good news for small businesses, who now have a level playing field with larger companies when it comes to IT expenses, he says. “All of a sudden now they can get the capabilities that large businesses have.”
[contact] William Cavanaugh, Solonis: 612.798.2100; www.solonis.com; info@solonis.com. Jim Kelly, Genesis 10: 651.702.3300; www.genesis10.com; jkelly@genesis10.com. Brian Strojny, InSite Group: 651.268.5354; brian@groupinsite.com. Dave Walstad, Agiliti Inc.: 952.918.2000; www.agiliti.com; dave.walstad@agiliti.com.
