IT Savings

Breaking News: IT Can Actually Save Money

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Headline: IT Saves Money for Company!

Wouldn’t it be great to see more headlines about the positives of IT rather than all the negative press about cyberattacks, privacy concerns and cost overruns?

If you are a small to mid-sized company, you are probably using one or multiple vendors for IT services and support (i.e. phone system, cable/network, internet, IT guy, etc.).  You may even have an internal “IT guy” or IT staff that works with one or more vendors to deliver IT services.

At Fluid, we state we will, not only, provide excellent support services (which should be expected), but we also provide valuable strategic IT services to help reduce IT costs, improve productivity, and implement technology that will support overall business objectives.  Unfortunately, companies have received poor support services for so long that they don’t believe there is any way money can be saved and productivity can be improved by working with an IT services partner.  Most businesses are used to the reactive support model, which often does not resolve the root cause of issues.  When a need arises, IT personnel fixes the problem as quickly as possible so that users can do their jobs.  But, the root of the problem is often ignored, and the same issue will usually occur again.

Go beyond the basic blocking and tackling

Providing quality support/helpdesk services is at the basic level, and any IT services provider should be excellent at it.  But, beyond basic support, we see the real value in approaching technology strategically and proactively, and ensuring that the right people are focused on the right things.  Also, properly managing all third-party vendors, on behalf of a company, requires a balance of the right staff, the right skillset, and most importantly, an in depth understanding of the business.  We’ve built our MSP business model based on the premise to deliver on those promises.

Focus on the whole, not the parts

When working with technology vendors and partners, each one typically only focuses on their piece of the puzzle, never expanding beyond to see how it fits into the rest of the business.  Our approach is opposite, which results in tangible benefits.  We take over the management of all third-party vendors to ensure that everyone is working towards singular goals that align with the overall business objectives.  Also, most companies don’t want to deal with other vendors, but their IT personnel doesn’t do it for them either.  I can’t count how many times I’ve heard C-level executives say “I don’t want to waste my time calling ABC vendor. I can’t understand all the technical jargon, and I don’t want to.”

Case Study: Saving money and adding value through strategic management

To understand the possibilities, here is a real business case:

One of our clients recently acquired another company.  As part of the acquisition, there were all the normal integration components, which required areas for optimization. But, there were also other critical projects.  The company needed new cabling/wiring for all locations, as well as a new VOIP internet-based phone system, and upgraded internet service.  At each location, cabling, voice and internet service, was provided by a different vendor.

Most companies, in this situation, would allocate a staff member to manage all the vendors. The staff member may have some technical acumen, but not enough to truly know what to look for in order to manage each vendor effectively.

In our client’s case, as in most similar situations, all the vendors were dependent on the other for implementing their services.  The internet service had to be increased to meet the new phone system requirements, and the cabling had to be in place to provide the necessary “ports” or wall jacks for the phone system.  The number of total ports, in each location, drove the need for new networking equipment. 

As they should, our client wanted and expected that all the pieces would be done correctly so that they could walk in the office, and everything would be configured and working correctly.  The challenge is, every piece must be not only done correctly, but also timed in a way to minimize unnecessary ‘dead time’.

As their technology partner, we stepped in to manage all the vendors, and what we found was frightening.  The cable vendor had provided a quote for both locations based on a walkthrough with one of their staff.  They presented a quote that was over $20,000 for the job.  Once we evaluated it more closely, we found an abundance of new cables that were unnecessary.  This was not the fault of the cabling vendor, they were doing what they thought was right, based on what the staff member told them.  The staff member didn’t have the knowledge to understand the technical details, and how things would work with the new phone system.   

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We saved our client over $25,000 on one project

We evaluated the cabling proposal and conducted calls with all other vendors, to ensure that everyone understood their piece and dependency on one another.  After our evaluation and walkthrough at each location, the cabling cost dropped from $20,000 to $6,000.  A substantial savings of $14,000 in one-time CAPEX cost.

We took the same approach with the phone vendor and the internet service provider.  Internet service providers (ISP) are always happy to sell you more bandwidth.  Again, like the cabling, the ISP worked with a staff member to determine the bandwidth required.  As before, the staff member lacked the necessary understanding to calculate what would be required.  Working with the phone vendor, we calculated what the maximum bandwidth usage could be. Then, we compared it with the actual usage reports, which allowed us to calculate a more accurate estimate of internet bandwidth needs.

Through our evaluation, we found that the company could start at a lower bandwidth level and confirmed that the bandwidth could be increased very quickly if necessary.  So, rather than buying more bandwidth than needed ‘just in case’, they were able to get what they needed with the ability to increase.  We ended up saving them over $500 a month in OPEX costs – which adds up to $6,000 per year.

We took the same approach with the phone vendor and found the number of handsets was too high, which resulted in additional savings in both one-time CAPEX and monthly OPEX.

Lastly, the additional cable drops and phone system required the purchase of new networking equipment to connect everything properly.  If the initial figures were used from the cabling and voice vendors, the company would have purchased more expensive networking equipment than necessary.  This also resulted in additional savings of over $5,000 in one-time costs.

The total savings were significant – over $25,000 in one-time costs and $1,500 in monthly costs

By working with and managing all vendors, we were able to help our client save a substantial amount, while also ensuring that each vendor would implement the right solution and do it correctly.  For a small to mid-sized business, spending money on technology can cause a major strain on finances.  Without our involvement and management, the company would have spent money it didn’t really have on solutions that would have been excessive and completely unnecessary.

Your Managed Services Provider can and should save you money and improve productivity

I’m sure other MSP’s say they offer strategic services and can save you money, but we’ve found that the reality is very different.  Unfortunately, most MSP’s don’t have the staff or skills required to manage all third-party vendors effectively.  Anyone can say they can do it, but can they prove it with actual numbers.

Recession Obsession

If you’ve been alive 10 years, you’ve been through a recession – the Great Recession actually.  If you’ve been alive 20 years, you’ve been through two recessions.  30 years on the planet will give you…you guessed it, three recessions.  Although recessions do seem to be cyclical, they don’t always happen every 10 years. Over the last 50 years, there have been 7 recessions.

Gas Lines and Baby Food Jars

RecessionThe ramifications of a recession also change over time. Being 53 years old, I recall my grandparents saving every coffee can, baby food jar, and plastic container to repurpose and use for storing things throughout the house.  As products of the Great Depression, they were raised to literally save everything.  I can also distinctly recall having to wait in long lines for gas during the recession in the 1970’s.  My father and I would park the car in line at the gas station and go to the nearby strip mall to kill time for two hours while we waited for the line to move.

Although not a recession, I recall Black Monday in 1987 when the stock market dropped over 22%.  I was working at a financial planning firm at the time and that was not a good day, and not just because it was Monday.

Dot Bomb Bubble Burst

In the early 2000’s, the dot com bubble burst, and turned into the dot “bomb”.  It seemed like anyone with a web-based idea was given millions of dollars in funding without having to show any DownGraphprofits (a scenario which still occurs today).  eToys.com, Webvan.com, Pets.com, and many more all wiped out almost overnight.

Most recently, we can all recall, if not relate, to the Great Recession that occurred in 2007-2009 when the housing bubble burst due to the subprime mortgage crisis.  The term “government bailout” became a major thorn, and the nemesis for many household brands.  Many are still recovering from this economic meltdown. However, the prosperity over the past 10 years has dulled some of the sting.

But, some are now warning us that the great run we have enjoyed may be slowing down, and we’re potentially headed for a recession.  Search Google for “Recession 2019” and you’ll find blue-chip names discussing the very likely possibility that a recession is looming.

Before it's too late!

CrisisI have owned a technology company, Fluid IT Services, for the past 17 years, and we felt the impact of the 2007 recession – but in an interesting way.  We provide IT solutions and support for small to mid-sized businesses, and the cost of our services is typically less than the cost of one full-time employee. Although we lost the clients who unfortunately went out of business, we gained new clients who needed to cut costs and couldn’t afford full-time IT staff.

We certainly had to cut costs ourselves and manage everything more tightly, but we were okay because our risks were spread sufficiently, and we provide a service that is “recession friendly”.  We continued to grow as the economy improved, but always with a keen eye on our market segment and the economy as a whole.

As the economic signs, signals, metrics, statistics, etc. started showing a downturn, we’ve used it as an opportunity to get our business in order.  It’s much easier to evaluate all your people, processes and technology-related costs, and make sure that your business is operating as efficiently as possible, before things go south.

Every company has and uses technology (IT) constantly. Most companies today wouldn’t be able to function without IT.  But, when times are good, costs related to IT (and other business functions) may not be closely monitored because sales and revenue can cure many ills.  However, it’s best to ensure your IT house is in order before the times get tough and budgets get tight.

Start by asking questions

An analysis of your current IT spend at a detailed level, may be as exciting as watching paint dry, but it’s crucial when dollars tighten. IT cost analysis can also be difficult. Even knowing which items to include when analyzing your IT spend can be confusing. I’ve found that it’s easiest to start by asking questions…

  1. What are my costs for internet, phones, software subscriptions, IT support, computers, etc.?
  2. What hardware needs to be replaced soon? How much will it cost to replace?
  3. What costs can be reduced or eliminated?
  4. What costs are a bare minimum to keep the lights on?
  5. When was the last time I evaluated all my contracts related to technology and what are the terms? Being locked into an expensive 5-year contract at the beginning of a downturn is no fun.

Good news...

We can help! At Fluid, we help companies analyze their IT costs almost daily. So, we already know where most of the IT costs are found, where the skeletons are buried, what is reasonable, and what is outrageous.  As a provider of outsourced IT services for small to medium businesses, we have to know these costs because we’re responsible for managing them in order to be a good steward with our clients’ hard-earned money spent on IT.

We also take it one step further by using a more proactive and strategic approach to IT. We will hope for the best, but also help you plan for the worst by discussing current and future business needs, goals and “what if” scenarios. Once we have this information, we can provide guidance on ways to cut IT costs and suggest solutions that will generate revenue, and specifically align with each clients’ business plan.

Don’t be afraid to say you don’t know and bring in experts to help you understand your costs.  It will reap rewards now and help you sleep better when economic conditions do change.  Feel free to call Fluid IT, we love this stuff!  Our main objective is to help people with their businesses and see IT in action!

We've moved everything to the cloud, we don't need IT staff or support.

It’s Fall, the weather is cooler, football is in full swing and we finally moved all our systems to the cloud.  No more worrying about having the deal with all that techie stuff.  Life is good! vectorstock_3501851

 

“We’re in the cloud, we’re all good.”  We hear this all the time from business owners. The number of companies using cloud services for all their business software is increasing. With no servers and software in the office, many people have the misconception that any hardware still onsite, requires no attention.

So, when asking owners and CEO’s about their IT needs we get the quick “We’re all good, everything we have is in the cloud.”

This misconception is not only inaccurate, it is extremely risky.

While it is true that cloud solutions can mean computers in the office, laptops and desktops may not need to be as beefy because all the work is ‘in the cloud’, the fact remains there are still devices, and more importantly, users that will require the same level of IT support and responsiveness from their IT staff/provider.

Security is a primary concern when in the cloud.

In the “old days”, users would login to software and systems running on servers in the closet.  When there were issues, the IT guy would come to the rescue, and they would take systems down to do maintenance, upgrades, etc.  Having your software in the cloud can be very easy to use, convenient and appear to not need the same ongoing care and feeding, which can be mostly true and a great advantage of the cloud.  But that one first step – logging in, is still a critical component to ensure proper security is in place for accessing systems now in the cloud.

Managing security is still a core requirement for every business and with the “sprawl” of cloud solutions, many companies use multiple cloud applications requiring multiple logins and passwords.  On the other end of that cloud application is a user that still requires support when things go wrong, or when they want to add something new.

Users still exist and need to be supported

Seemingly simple cloud applications like DropBox still require security settings, user settings and support in a business environment.  You probably don’t want all employees to have access to sensitive HR data.  Users still must be added and managed, printers still stop working (the bane of my existence), and laptops and desktops still fail.  Assuming there is no need for IT support, puts the company back into reactive mode, only addressing needs after something happens.

Reverting to reactive support is a step backwards in user productivity

Most of what IT does is under the water line.  Like the propeller and rudder on a boat, you can’t see them, but they are required if you want to move forward in a precise direction.  Technology is only visible when the business and users are accessing it.  Much of the cloud is below the water line and appears to work on its own, but it still requires the skilled engineers and technicians to ensure everything is working to meet the business goals.

When you add the ongoing and more visible needs of the end-users, having good, proactive managed IT support and security is a MUST! Therefore, even when everything is in the cloud, having the right IT support can make the difference between success and failure.

Why You Need a Second Opinion Before Restructuring Your IT Department

  Do This Before Restructuring Your Internal IT Department Not too long ago, we shared a story of a company that wasted well over $300,000 when they implemented an IT plan without getting a second opinion.

This is something we hate to see businesses go through.

One of the issues that came from that costly mistake was that the company got rid of their outside IT service contracts and brought all their IT support in-house. They decided that if they were bringing all their IT hardware and equipment in-house, their IT staff should be in-house, too.

This mistake wasn’t a one-time waste of money. This cost the company multiple thousands of dollars every year going forward.

When we see companies considering restructuring their IT departments – especially when they’re talking about bringing their IT support in-house – we beg them to get a second opinion from an unbiased and business-focused expert. If not us, than someone else they trust!

Many small, medium and large businesses do not see a financial benefit when they bring their IT staff in-house. This move is expensive and incurs both one-time costs as well as ongoing costs – all of which can often be mitigated with a good outside IT service vendor.

Here are three things that most business don’t know about moving their IT in-house.

1. Using Outside IT Support Allows Your Internal IT Team to Focus More on Your Business

Everyone in your office should be focused on one thing: your business. If your IT team is spending all their time managing operational tasks, like running an office-based server farm, they don’t have time to focus on day-to-day business tasks, like getting new users set up.

Managing your business’s IT equipment, hardware, data, security, user setup, etc. is a full time job – for multiple people. It’s easier to keep your IT team business-focused when the operational support is outsourced.

2. Most Businesses – Even Large Ones – Cannot Afford to Hire Every Skill-Set Necessary

No one single person is going to have every skill-set necessary to handle all of your IT needs. So if you are going to have all or most of your IT staff in-house, you are going to need to hire multiple people with varying skill-sets.

First, this is costly. You will now be paying for salaries and onboarding for multiple new employees. Even then, you likely will run into IT support issues that your team can’t handle – and you’ll still need to bring in outside help occasionally.

3. Even When You Have More Internal IT Staff, You Will Still Have to Bring in Outside Support

Let’s say you hire three IT support personnel: a Level 1, Level 2 and Level 3 IT service technician. Well, what happens when your Level 2 person is out sick and your Level 3 person is busy dealing with a major security breach on one of your office servers? Your Level 1 person doesn’t have the skills to handle Level 2 IT issues. So you call in outside support.

Calling in outside support ad-hoc is a very expensive way to run a business. It’s often much more cost-efficie      nt to have an ongoing contract with an outside IT service vendor.

How to Know When to Get a Second Opinion

When your IT leader brings you a business case with a price-tag that makes you cringe, get a second opinion. In fact, it’s smart to even set a dollar amount to that. Say, if an IT situation is going to cost your company more than $50,000, you call in an expert for a second opinion.

Yes, that might cost you a little bit of time and maybe a consultation fee – but it may just save you $300,000!

It’s great if you trust your internal IT team when they come to you with an IT restructuring proposition. But don’t bet your business on it. Get a second opinion before you make any large, expensive IT moves.

Reinventing Law Practice with the Cloud

When Len Musgrove started his own law practice, IT was just another frustration and expense. He was all-ears when Wade Yeaman said, “The cloud would be an easier, more cost-effective solution.”