MS had 5,000 layoffs in 2009...only weeks after Bill Gates said we need more foreign H-1B workers.
With the government stating we've been in a recession since November 2007, and the media filled with troubling economic news, hard times are upon us. Some prognosticators are predicting that things will get worse; maybe a lot worse. Some are predicting the start of better things as early as 3rd quarter this year! However, there is probably no such thing as a business that's unaffected.
On the information technology (I.T.) front, even the lofty Microsoft announced 5,000 layoffs in 2009, a significant number of layoffs. This only weeks after Bill Gates gave interviews saying America needs to allow nearly unlimited H-1B I.T. workers into America because we have a shortage of I.T. workers. Ironic. Makes me wonder if it's time to abolish the H-1B program entirely.
Yet surveys of the small business sector paint a slightly brighter picture: For 2009, small businesses expect to increase I.T. staff (though probably not wages). Is there any logic to this? I think so. As we look back over the past couple decades, one thing is crystal-clear: Computing has enabled businesses to reduce costs, and increase productivity.
In hard times, you do not "lay off" the goose that lays the golden egg. What you do, instead, is "tune up" the goose; and take other measures to cut costs, increase sales, and maximize profits.
In this article, we'll look at some areas where computing is (or could be) saving you money, where it's increasing productivity, increasing sales, and maximizing your access to your customers and potential customers.
There is one more aspect of your I.T. infrastructure that deserves special attention during hard times: Reducing your exposure to unexpected costs. We'll talk about that last.
And first, before getting to the rest of the list, we have to say one thing loud and clear: None of your other efforts in I.T. will be worth any more than the security of your data! If you haven't yet implemented a robust data backup and restore regimen, now is the time to do it.
Computers save businesses money in almost limitless ways.
Computers save businesses money in almost limitless ways. The strategies involve everything from simply providing a clerical worker a word processor, to cutting energy and materials costs by monitoring industrial processes.
There are two things we want to do in the money-savings area:
1: We must ensure that our money-saving systems are solid, reliable, up-to-date, and well protected. Replace or repair computers that are aging or showing signs of unreliability. As a rough rule of thumb, figure that business workstations have a useful life expectancy of three to five years. We strongly recommend using Windows Updates to keep your machines' operating systems up-to-date.
It's hard to say enough about protection:
At a minimum, every workstation should be equipped with a good-quality surge protector. Workstations that are not battery-powered should also have uninterruptible power supplies (battery backup units). Actually, UPS isn't a bad idea for laptops, too. You'd be surprised the number of laptops with poor batteries that are being run on AC exclusively. Mine is; it's simply too old to justify the expense of another replacement battery.
No workstation should be allowed to run without a current (and regularly updated) anti-virus and anti-other-malware program. We won't get into the debate about which ones are better than others, here - except to mention that the free version of AVG is quite good. Just do some homework, and be sure they're in use.
It's also important to train computer users in how to use the Internet safely. Since the Internet is now the source of most threats to your systems, and because hackers are periodically one step ahead of the anti-malware companies, users should know what's likely to be safe, and what isn't.
We could write several articles on Internet safety. Here, is one good rule of thumb: The more "fun" a site promises to be (porn is king, here - but not alone), or the more it looks too good to be true (coupon sites), the more likely that it has a payload waiting for you. The more that people stick to "business" sites the lower the chances of getting an infection.
Email is another threat not to be overlooked. Hackers are constantly bombarding the Internet with bogus emails that are designed to deliver a malware payload or collect sensitive personal data. Users should be trained to never open emails from unknown senders; or, at the very least, they should never open attachments, or follow hyperlinks in such email.
2: Double-check your "savings" strategies. Do you run custom-written software?
Custom-written software is one of the major ways that businesses gain advantages in savings, profits and productivity. The reason is pretty simple: No two businesses, even in the same industry, do things the same way. Mass-produced software, even for a specific industry, seldom addresses every requirement of a given business.
But custom software has liabilities, too. Let's look at some, and talk about the solutions:
Is the software well and completely documented? Does it include an integrated, context-sensitive help system? Does it come with training manuals and tutorials?
Documentation is an area where custom software budgets are often given short shrift, and that's a bad idea. There are two common consequences:
1: Users figure out how to use the software in ways that were never intended. Sometimes this is because of a perceived need for a "work-around." Sometimes it's because a requirement wasn't known - or properly implemented. Regardless the reason, these practices get promulgated throughout your organization because of...
2: Training by folklore. In the absence of good documentation, the tendency is for one user to train the next. Think of the parlor game in which a brief anecdote is passed around the room, each person relaying it to the next. The fun comes at the end of the game when the last person's version is compared to the original. It can be hilarious at a party, but there's nothing funny about it when it results in users appropriating data entry fields for unintended purposes.
Is your custom software up-to-date? I think it was the pundit, John Dvorak, that said "software is not a purchase, it's a subscription." That may be overstating the case, but there is a grain of truth in there. The most perfect implementation of all your requirements - as of any given date - will become less and less perfect over time.
Why? Because you innovate. There is no way that you're going to draw a line in the sand and say, "That's it. Hereafter we will make no changes to our business procedures."
No. To succeed in this struggling economy, you have to innovate and tune up your business procedures. As you do, your custom software may need to be updated. Before contemplating ways to "shoehorn" your custom software into new operational models, talk with its author(s). Odds are they can enhance it to do exactly what you require. The cost may appear challenging, but it is highly likely to be offset by avoiding the unintended consequences of kludging up some half-baked workaround. But the cost is often surprisingly low.
This is something we constantly strive for - not just in periods of economic weakness. But it certainly becomes important when times are tough.
Survey and watch your workers. Are their software tools quick and easy to use? Or are users wasting time scratching their heads and correcting mistakes? It might not be their fault. Find out precisely what the problem areas are, and find a solution.
Do you find the same task being repeated, again and again, when it could be automated?
A prime example of this is when the wrong tool is chosen for a given task. A word processor may support tables, but a word processor isn't a spreadsheet. Likewise, a spreadsheet can store data, but it isn't a database.
The wrong tool costs!
One of our clients came to us to replace a "solution" for which they had paid a couple hundred thousand dollars. They are a gold mining operation in Nevada, and had brought in a high-dollar "efficiency consultancy" to help them improve safety and streamline operations.
As part of the engagement, their consultancy created a "dispatch" system, a crucial item when you have an underground mine and you must know where every worker or piece of equipment is at any given moment.
It was also important for this system to record the types and quantities of various materials used throughout the operation.
This "solution" was delivered as ninety-some interconnected Excel spreadsheets! For the purpose of recording historical data, it was necessary to save copies of these spreadsheets at the end of each shift - according to a strict naming convention. Users often go it wrong.
To make matters worse, the spreadsheets contained cells with complex formulae, and, if a user inadvertently dragged one of those cells, and dropped it somewhere else, the entire "system" came crashing down. Then it took the in-house Excel guru days to get the mess unscrewed. Since it happened about once a week, he barely kept up - and he had other productive work of his own to be doing.
There is an old Russian proverb that applies, here: "When all you have is a hammer, everything looks like a nail." Excel is a fantastic product; in this case, it was the lone tool (a hammer) in the consultancy's tool belt. So, to them, the dispatch problem looked like a "nail."
This was no spreadsheet problem - it was a database problem, and that's how we tackled it. The difference was night and day.
One of the most important things a business can do is to turn their entire staff into "salespeople." Not exclusively, of course. You'll still retain specialists for sales work, and other staff will continue to perform their normal duties.
But every worker that has contact with your customers is a potential salesperson. They can be trained to "hear" leads during the course of ordinary conversations. They can be trained to either pursue those leads themselves, or to pass the opportunities on to your sales staff with alacrity.
When somebody expresses a need, the time to close the sale is now.
Every employee knows (or should) that his income derives from your gross profits, and this is all the motivation it should take for all staff to be on the lookout for sales. Some, though, need a little nudge; a little extra training.
Staff should also be trained to keep customer contact information accurate and up-to-date because of the irreplaceable value of customer management. More about that in a bit.
"Work smarter, not harder" has become a cliche. And things become cliches because they usually embody useful truths. In another article, "Work Ethic v2," we explore ways to energize your staff and turn them "on."
Is your web site doing its job? At least once a month, you should visit Google, Yahoo, and other search providers, type in searches that should turn up your site, and note where you "rank." Sites that show up closest to the top of search results get more visits.
If your site isn't getting consistently high rankings, you need to find out why, and take the necessary steps to earn high rankings. Otherwise, there's not much point in carrying the expense of a web site at all.
We'll mention just a couple of the essentials:
- Fresh content: A static web site isn't terribly interesting to anybody, except, perhaps, during their first visit. Web sites need fresh content to keep visitors coming back.
- Proper intrinsic attributes: It's easy to omit a page title when authoring a web page. The page title isn't an attribute that's staring you right in the face. But a blank page title causes search engines to "think less" of your site.
- Every web page has "invisible" areas in the HTML source. The HTML standard provides ways for you to specify key works and phrases that you expect people to be searching. These need special attention.
- Search engines compare your invisible keywords and phrases against page content. A high level of relevance between the two (invisible "tags," and visible page content) makes search engines happy.
- People that get cute, and put "sex" in their meta-tags, when their page has nothing to do with sex, are being too clever by half. Search engines downgrade sites that use tricks like that.
- There are several other attributes of your web site that can be "tuned" to make it more "impressive" to search engines, but that's a topic for probably several other articles.
- Blogs: Search engines love blogs. Blogs take work. But effective use of blogs can do wonders for your search rankings.
- "Foreign" links: How many other web sites have links to yours? The more there are; the more "important" search engines consider your site.
- We have another article specifically about blogs and external links. Check the link at the bottom of this article.
- Prestwood will soon announce details about our exciting new web site ranking optimization services, so stay tuned.
- Looks do matter: The web is like the fashion industry. What looked slick and cool just two years ago now looks dated. At least twice a year, you should browse the internet and note the attributes of sites you admire. Compare your own site to the best of the others you see, and consider updating yours to keep it fresh and interesting.
- Depending upon how your site was designed and authored, it can be quite difficult to update its look. But it needn't be so. Microsoft's ASP .NET technology (a Prestwood specialty) has some fantastic features that take the pain out of updating a site's look.
- How's it feel? What is the visitor experience when visiting your site? Is it clear and easy to navigate? Can visitors quickly hone in on precisely what they're seeking?
You have a customer management system, right? Your database of customer information is your gold mine. In the world of sales, it's commonly known that it's about ten times easier to make a sale to an existing customer than to sell to a new customer.
That is one powerful fact! It doesn't mean you abandon your quest for new customers, of course. But it does mean you pay special attention to your contact management systems and procedures.
How easy do you make it for customers (and potential customers) to give you their contact information? Do you have a secure web page where people will feel comfortable filling out a form with some personal data? Can they come back and update their "profile" when an address or phone number changes?
Are you collecting all the information about customers that could be potentially useful in future sales?
Names, titles, phone extensions, birthdays and email addresses of various contact people at your customers' places of business are all important.
Birthdays? Absolutely. How else can you send a birthday card at the right time?
Names of spouses and pets? Hobbies and other interests? These little details can help your sales staff make customers feel special, help build rapport.
At the very least, your contact management system should allow for recording ad-hoc notes about each contact. Each contact is unique, so it's vital that all your staff have immediate access to customer details.
Custom software can play a key role, here, too. It can do everything from "tickling" your sales staff to running automated email campaigns.
Reducing Exposure to Unexpected Costs
The unexpected will happen and, when it does, it's often accompanied by an expense. Mr. Murphy (of Murphy's Law) is alive, well, and on the job.
There are areas in computing where the unexpected can be predicted, and what can be predicted can be mitigated.
A great indicator of looming unexpected costs is your level of "technology debt." Technology debt is the sum of all the costs out on the horizon that can (and will) come back to bite you because of "holes" or lapses in the totality of your IT infrastructure.
We have a complete article about technology debt, also linked at the bottom of this article.
Difficult economic times call for action, especially with information technology. Business as usual may not be enough to weather the storm. In hard times, the temptation to cut back on the resources you allocate to I.T. comes easily. And that can be a huge mistake. As we said at the beginning, I.T. has been saving money (and making it) for decades. It's the sometimes cranky old goose that lays the golden egg. The smart thing to do is to tune up that goose.