I am looking for cost effective software-as-service solutions. Help!

I am in the middle of launching an online business, that will have multiple locations long-term and staff that will be located across the globe in all the major ski resorts of the world. I am currently trying to find a Cloud SAAS solution that is cost effective and has these functions: document management, CRM, sales forecasting, tax management and joint calendars.

This is becoming a common scenario today as smart people realise they do not need to own infrastructure to get global software solutions up and running fast.

Clearly you need a powerful but customisable email solution, document authoring and collaboration tools, document storage with a structure to it and a CRM tool that will expand to cover your vast terrain.

For online email for business I do not think you can go past Gmail where you can register your own e-mail domain and use Gmail to offer unique email addresses to each of your staff or licensees immediately. There is a very small cost for this but it will give you what you need for a fraction of the cost of other solutions.

There may be other solutions out there but I have not spent time investigating beyond Gmail as it ties in with Google Apps which we support as a business. This will also lead you towards Google docs where you can create and share documents with your global team setting access levels as required for collaboration. Gmail and Google apps will also give you the shared calendars you are after.

I would be pushing the shared calendar through to Salesforce.com which is the CRM application we sell. Here you will run into cost issues as Salesforce.com is not the cheapest solution for SaaS CRM.

Salesforce.com also integrates nicely with Google docs and Gmail, as the two company founders are doing deals to support their mutual drive to build the cloud argument for software as a service. This tool will instantly give you graphical insight of the stages and progress of sales of each of your sales people globally. The reporting out of Salesforce.com is one of its strongest features as it is easy to design reports and simple to represent them graphically.

Please note that there are a number of hosted solutions you should look at include Sugar, Sage, SAP, Microsoft CRM.

I hope readers will add their personal preferences in the comments below so we can pool our knowledge on the vast array of products that are coming onto the market in the SaaS space.

David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

I keep hearing I should have a CRM system, but I don't get why!

With a customer relationship management (CRM) system you can keep a list of your clients, prospects and leads just about anywhere - from Outlook to a spreadsheet to an old fashioned card system.

If you are the only person doing sales in your business (unlikely!) then it doesn't really matter what you use. But when you figure out what the industry leaders are doing with a CRM system, you might see you need something more sophisticated.

Today I am going to share a few ideas and concepts with you of what to do with a CRM. These are the keys that are helping me beat this recession.

It is clear to me that sales cycles are currently longer and more competitive than usual, as business owners put more care into ensuring they have the best solution before spending money. So, ensuring that EVERY contact with a prospect is logged ensures we keep track of each opportunity from start to sale made, and beyond.

I now need to target my marketing to clients more carefully to ensure it remains valuable to them, so keeping details of source and interest of each person or company is imperative. We systemically gather every piece of important information about a prospect so that when we do targeted marketing and lead nurturing to potential buyers, they are turned on by the accuracy of our pitch, not turned off by the volume. Could you improve your targeting of interest topics?

We have introduced well-defined lead nurturing processes that automates a series of messages, each with a call to action for each product line we offer. So now a quote for a product or service is followed up by a nurturing campaign run automatically out of our CRM application.

Of course, as we get more active in our marketing, both electronic and direct, we must ensure that we manage duplicate prospects in the CRM system. The trick is not necessarily to prevent them in the lead identification stage, as the same lead may come from multiple places, but to process them out during the qualification stage.

From a sales activity perspective, it is important that we can track our progress through a defined set of sales stages, particularly to understand where buyers are leaking from our sales pipeline. Are they still buying but from someone else, or are they just not buying at all! If the first, we may need to adjust our "product"; if the second, we may need to improve our call to action.

By being systematic about progressing each opportunity through the defined sales stages, we get a great overview of how our sales are progressing and what our likely outcomes will be over the months ahead. We are also starting to track how long it takes our buyers to move through the sales stages so we can see where people are getting "stuck".

It is also most useful to us to have mechanisms (again both systemic and in the business process) to drive data quality and strong segmentation in our existing database. Now is when we need to get the best possible results from the database we have. These people who know us and have met us over time are potentially much more likely to buy from us than total strangers if we have the right product to sell them.

By creating our marketing campaigns in the CRM and tracking who each campaign is run against, we are also able to build information that allows us to track ROI on particular campaigns. Which ones are working and which ones aren't? What other factors are influencing?

We also use the web to lead forms, to receive a lead from a particular campaign via our web site, directly into the CRM database and track that lead all the way through to a sale and then attribute the revenue and margin back to the campaign that brought us that client, even though they came from the website.

No doubt many of you reading this have similar CRM systems in your business and know the kind of benefits this technology is driving to your bottom line. I would love to see some comments below on where you are up to with your use of CRM, and how that correlates with your success in the current recession market place.

If your business is struggling to intelligently manage customer details and you need a CRM system, do not hesitate to contact Combo. We are understand business processes and can help get you started on industry leading Salesforce.com software. You will start managing your business more intelligently and with a far greater return on your marketing for increased sales.

David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

My in-house IT staff are slow. What are my options?

Many businesses argue that in-house IT staff provide loyalty and gain specific knowledge that solves local problems faster. However when I hire IT people who have been the in-house person, they often say the reason for moving is the stresses of having been a poorly trained "cost centre" within the business, with unrealistic expectations placed on them for delivery. They typically look forward to being part of a team of like-minded people who are part of the company's income stream.

For example, my business Combo looks after systems for IT companies, among others. These clients develop software, and had realised that they were spending too much time looking after infrastructure, and so they outsourced.

If IT companies outsource with all their specialist requirements and knowledge, who is there that should not outsource?

Now, I am convinced that if you do not have the capacity to run a team of at least three IT people you should outsource your IT to a company. But make sure the company you decide to outsource to has excellent management systems and at least seven technical staff.

Yes, it could be argued that I am biased, but I have a good range of experience to base this on. I have worked as the one in-house IT guy, I have run in-house teams of six staff, I have run a one-man IT services business, and today I run a fast growth medium size outsource company.

As my name is David, I like the story of David and Goliath, and I can relate it to this issue quite nicely.

David went up against a huge army led by a giant and got in one very lucky shot that ended a battle and a war. In IT the odds of one person hitting Goliath with an IT solution is significantly lower, as the war is against an industry where the rate of change is still accelerating.

No one person can cover the huge range of emerging technologies at a suitable level to know what to deploy next or how to deploy it. So there is no one stone and no suitable soft spot on the giant to hit. One person may win a battle or two, but not the war.

These days every business needs a team of IT people to ensure the breadth of focus is met, from infrastructure to security to applications to web to communications. Each SME business needs to have - a strategy for receiving and following IT related advice; IT action plans for staying ahead of the competition; IT problems never appearing in the first place, going away when they do appear and being measured to provide a basis for improvement.

We can no longer afford to focus on just one aspect of IT in any given year; we must keep many aspects improving to stay on top of our business.

If you are thinking about hiring a new internal person for any one aspect of your business, I suggest you look very closely at the benefits of outsourcing to specialists who can provide a broader range of solutions in a fraction of the time, and usually at a better cost.

• You can access hundreds of days of training for a fraction of the costs.
  
• You get the benefit of knowledge sharing that happens when a team of people working on similar issues get together regularly.
  
• You get instant access to experience gained on other similar jobs.
  
• You share the cost of skills development across all of the clients of the service provider, including the cost of developing solutions to new problems or threats.
  

Obviously you remove the gaps between full time employees as they come and go, sick leave and holidays. With an outsourced help desk you even remove the gap of a lunch break. You remove the issue of long shifts or split shifts and so much more.


David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Should I bring forward infrastructure spending to get the 30% tax break?

If your business is turning over more than $2 million and you need a new server, then you need to act quickly before it is too late to determine what to buy.

Implementing new server infrastructure is a costly exercise, but if you purchase the asset before 30 June, you are eligible for a whopping 30% tax break.If you have a 90 day analysis cycle it may already be too late to do the analysis and get the expenditure approved.

Don't be complacent about this; if you are planning to spend over $10,000 on your server asset you need to make sure you have the solution properly designed. You need to consider storage requirements and processing power as well as software and operating system requirements.

It is also a good time to consider server consolidation through virtualisation while the larger servers meet the $10,000 asset cost requirements for the tax break.Distributors and resellers alike have reduced staff in the well published IT spending downturn, and stockists of large equipment have reduced stock to improve cashflow.

Clearly, trying to place an order at the last minute to have your equipment installed before 30 June is not a good strategy. Sure you can install it next year, but why wait for the refund for an additional 12 months if you know you need the infrastructure now.

Many firms, mine included, are running discount schemes on server hardware to attract much needed services work and to attract new clients, so there has never been a better time for making infrastructure purchases.Be warned that large purchases of desktops and laptops, while great for sub-$2 million turnover companies, are probably not going to get you the discount you are looking for.

According to Paul Wright of Mathews Steer Chartered Accountants, "while there is a lack of clarity regarding the Government's proposals at this stage, the understanding is that the tax concession is per asset, rather than a general aggregation of assets".

He also states that: "It should also be reiterated that as the legislation still hasn't been passed, and the Senate are apparently not sitting until the budget hearing, we have to continue to suggest caution in promoting the tax concession in case the Senate take an alternative view."It has been suggested to me that the Government is seeking legislation by press release rather than due process. So we are all hoping it goes through.

In Wright's words: "The extended delay between the announcement of the proposed concession, and its passing/confirmation, is not proving helpful and impeding the whole purpose of the initiative."One would think that in these pressing times with such big spending and tax cut decisions underway, there could be a special meeting of the Senate to finalise details and let business get on with plans - before it is too late to grab the tax concessions in this period. With cashflow causing issues for so many businesses, waiting 12 months for the refund does not sit well.

Wright also shares that leasing financiers are worried about the delay as they face being inundated with leasing applications just before 30 June. The reality is some applicants may miss out, not just because of the volume of applications, but because credit assessments are generally taking longer. There is therefore a lot to be said for clients gaining finance pre-approvals now, so that the finance is ready, should the legislation be passed.

To gain a pre-approval however, the financier needs to know the details of the asset being purchased, and therefore that planning still needs to be made now.This reinforces my statement about planning.

Now is the time to do the planning and design work to be ready to make the large purchasing decisions as soon as the legislation is passed mid-May, leaving just six weeks for supply and installation. So you will want to include your suppliers in the planning, won't you?


David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Does cloud computing mean I need to seperate hardware and software?

Cloud computing people are telling me to separate my applications from my hardware; what is that all about?

In small to medium enterprises, the temptation is to lump "IT" into a single bucket. Your IT staff, if you have them, look after your business systems, servers and PCs.

The danger with this approach in the new age of "cloud services" is that you and your people get stuck trying to work out an IT strategy that takes advantage of the idea that there is all this stuff out there in the cloud that doesn't require any infrastructure, and is therefore supposed to be cheaper.

But the reality is that it is going to be at least three to five years before every business application you need is available in the cloud and you don't need any more infrastructure of your own.

In the meantime, what do the smart companies do?

The answer lies in understanding that you, as a business owner or CIO, need to stay focused on procuring, implementing and continuously improving business systems that support every part of your business, using whatever IT applications are most appropriate for your budget and your business vision.

And for the next three to five years, the underlying infrastructure is going to be mixed. Some of your applications will need a server to live on, some of them can be hosted in a shared (virtual) or standalone environment, and some of them will be in the cloud.

And you need to have an infrastructure platform that lets you nimbly and cost effectively move from one to the other according to the needs of the applications that are supporting your business.

In the next few weeks Microsoft applications will become available as cloud-based solutions via Telstra. These should include Exchange Server, SharePoint Server and CRM.

(I would love to hear your comments on the Microsoft-Telstra hook-up, which is unique to Australia. Anywhere else where hosted Microsoft apps are available, it is done directly via Microsoft, but here in Australia I figure Microsoft lacked the infrastructure and so decided to partner up with Telstra. Good move or bad? Will you pay Telstra to access Microsoft applications?)

We now need to consider the cost and advantage of keeping these services in-house versus simply connecting.

As an example of the technical complexity thrown up here; we have not yet seen integration between Salesforce.com and a cloud exchange server. If you are already committed to Salesforce.com, you are probably better off selecting a traditional in-house exchange server or a hosted equivalent. This may change at short notice once testing of the cloud based environment is done.

In a situation where you want to use the cloud exchange solution, a short term deployment of a virtual hosted exchange server could be the key to rapid deployment with options to switch quickly once the desired service is tested and available.

This is a new age in technology, as the stuff in the cloud becomes the equivalent of the tools we have been using for years and scales down into micro businesses to give them everything their larger competitors have. In-house IT staff may struggle to keep up with the rate of change here, and may not have the advice business decision makers need.

So separate your IT infrastructure provision and outsource it. Buy what you need when you need it from experts who will maintain whatever is needed to keep your business systems running effectively.

Focus your internal IT energy (with help from experts as needed) on the applications layer - choosing the business systems that have the functionality you need and implementing business processes that make you the best business you can be.


David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Do I need virtual server for my business?

Last week I mentioned that I had not yet said much about virtualisation. With the recent announcements surrounding the national broadband network (NBN) it is time to start thinking about the infrastructure for the future and building systems now that will see us through the next few years while the politics and reality of the NBN plays out.

First we need to ask; why virtualise at all?

There can be only one answer to this in the current climate - to save money. If you will not save or make more money through virtualisation, now is not the time to do it.

Other drivers for virtualisation include reduced power and cooling requirements, space reduction, hardware consolidation, lessened environmental impact and an added layer of management that improves flexibility - letting you shift servers from one hardware platform to another with little effort and no downtime, for example.

Next let's address who should or could virtualise?

If you are a small business with one or two servers, virtualisation is probably not going to give you much more than headaches. If you need three or more servers there are possible cost savings, depending on which technologies you select. If you have significantly more than six servers there are likely to be considerable savings available to you.

What are the benefits that lead to a reduction in cost?

The cost savings come from both a reduction in the number of physical servers required and more efficient use of the existing resources and thus a reduction of capital expenditure. The reason the hardware is used more efficiently is that a single server is typically only busy for brief time "slices" and spends most of its time in an idle state or relatively unused. Typically each server has access to its own storage resources and these too are only partially used, leaving spare capacity.

Virtualisation software can better manage the resources of processor, memory and storage to keep a number of servers busy a higher percentage of the time. Multiple operating systems (OSs) can then be run simultaneously on a single hardware platform. They can be different OSs such as Windows and Linux, or different versions of Windows, and so on.

For a business with an application that requires Windows 2000 and no plans to support Windows 2003 or 2008 server, this can be a blessing as maintenance of a separate hardware platform is no longer required.

With multiple OSs on a single box, it is possible to have a large array of hard drives attached and have the virtualised servers share the storage as required with only minimal slack space across the set.

Similarly one physical server can have multiple processors and "time share" the processor resources. All this leads to a smaller physical footprint, lower total energy required, and less investment in aging hardware.

Once your organisation has multiple physical servers hosting multiple virtual servers, it is possible to set up fail-over options, whereby a virtual server can be moved from one physical box to another and automatically restarted in the case of a hardware failure.

There are many other benefits to virtualisation that I will discuss in the future as well as looking at options offered by the three major technology providers in this space.

If you have specific questions on virtualisation please add them in the comments below and I will address them.


David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

When should I start planning for the new broadband network?

There can only be one IT topic to discuss this week, and it has to be the shock announcement by Kevin Rudd on the biggest investment in infrastructure this country has ever seen.

Nerds like me all over Australia are feeling vindicated for the hours we spend huddled over computers. This project throws computer technologies to the forefront of the business world with the message that fast information flow is a big part of the future of this country.

Opportunities abound, from video conferencing in homes to new cloud-based solutions to old problems.

Data storage, as I mentioned in my last post, will rapidly move on line as files will be able to be called on from anywhere, unlike today where we can wait to upload and wait to download, which does not work in most business cases.

As the broadband dust settles, what is next for business?

Most of our business clients are running 100Mb networks from their server room to the desk in their office. Some are using gigabit connections, but most don't need that much.

So what the new NBN means to me is that now we will be able to connect every home-based office in Australia to my data centre at full speed. What could only be done in the office will now be able to be done anywhere in Australia. There are so many spin offs of this serious technology upgrade that it is hard to know where to start.

If anyone wants to form an opportunity seeking think tank with me, let me know - because the rules changed this week and that means big opportunities for people who lay the right plans.
I see massive potential for hosted applications and hosted servers and services. I have hardly mentioned virtualised servers in my articles to date, but it is now time to ramp up plans for massive server fabrics hosting virtual environments for all sizes of businesses.

It's time I added video conferencing technologies to my suite of products, as this will be a great time saver for any SME with distributed staff or clients. This will become a smooth technology in every home and office.

I can look forward to video based webinars educating my future clients on the latest technology developments. Note to self: "Must start the diet and plastic surgery regimen soon". Hmm, can software make me look better on video?

I have lots of questions that SMEs like Combo and our clients should start asking themselves:

• How soon can we start connecting at home and at work?
  
• Should we run our own servers or can it be done more efficiently by IT hosting companies?
  
• Will our software move to multi-tenant environments such as Salesforce.com or will we still need our own hosted servers to create single company instances of software?
  
• Do we still need a central office or can we decentralise and work from home and local offices to reduce our costs and lost time and to reduce our carbon footprint caused by travel?
  
• How will this affect the current ISPs which will convert consumer demand to connected clients and how will these businesses be regulated?
  
• How will pricing be determined for the end user? Will our fees have to pay the installation cost over three years, five or 10?
  
• How long will it be before the fibre technology is obsolete?
  
• Will Telstra's upgraded cable technology be a competitor to the NBN?
  
• Which city should the NBN company be based in? My vote goes to Melbourne as the best possible location.
  

I'm sure there are many more questions that we will all wish we thought of as the solution emerges. The answers will play out and shape our business and social communities over the next 10 years.

Share your ideas in the comments below.

David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Why does business storage cost 75 times as much as home storage?

Something we have struggled with this week in our business is explaining to our clients why one terabyte of storage for their server costs $15,000 when we can go down the road and pick up an external hard drive for a few hundred dollars with the same capacity.

We are seeing this sort of split growing in business technology versus home-style technology, as cheap versions of business-grade products flood the market.

Business and enterprise grade products are designed with a number of qualities and features taken into consideration. They are designed to:

• Run 24 hours a day, seven days a week for years at a time.
  
• Be scalable - you can add capacity in incremental units.
  
• Give reliability - drives are tested to run for 100s of 1000s of hours.
  
• Be fault tolerant - a collection of drives continue to run when some parts of the system fail.
  
• Ensure data is available to multiple users simultaneously, with a minimum delay.

In the past all storage was expensive. Over the past 10 years the price of home hard drive storage per gigabyte has dropped from $50 a gigabyte to less than $1 today.

My advice is that you get what you pay for.

• A hard drive from a computer store might only come with a "replacement" warranty, so no guarantee on the data, versus quality drives that may hold a three or five year warranty.
  
• Speed is critical to good data transfer rates so your disks need to spin twice as fast, so connections need to be constructed of higher quality components.
  
• Enterprise storage has management tools, automated monitoring, backup options and high-performance technology like battery-backed memory cache.
  
• You can't easily share, divide or move home storage options.
  
• Power management including redundant power supplies may be available on better systems to ensure continued availability.

In the future our data will be stored not in these primitive spinning devices but somewhere in the cloud, as we already do with our on-line photo albums and so on. It will reach a point with high speed networks and cheap data rates that on-line storage will make more sense than the very power and resource hungry distributed model we have today.

Once on-line retrieval becomes fast enough for business use, there will be no cost benefit to local storage anymore. After all, why would we all want to buy technology that is liable to fail and needs to be upgraded every three to four years when we can just save it to Google or Amazon? The question is how long will it be before our hard drives are dinosaurs?

David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Can I buy IT gear and get the new small business tax break?

In short, yes - all businesses can claim the special 30% tax break for purchases of IT equipment.
If your turnover is less than $2 million, you must spend at least $1000 on suitable assets to qualify. If your turnover is over $2 million, you need to spend $10,000 to qualify.

But there is a huge "gotcha" that most IT companies have not yet discovered, and so are not yet telling their clients. As the draft legislation stands this week, software and installation services are not covered by the tax break.

The current ruling is designed to encourage industry investment. However, as Ian Birks, CEO of the Australian Information Industry Association stated recently: "As an initiative designed to spur productivity and lessen the impact of the economic downturn on Australian businesses, the omission of software from tax break incentives is serious oversight.

"Technology is acknowledged as a key driver of productivity in this country, and in the past the Australian Government has identified technological innovation as the major driver of long term productivity. Software is integral to this process, and it should not be ignored in incentive schemes designed to stimulate activity in these areas."

While the Government already treats software as a depreciable asset and makes it a deductable work related cost, it has followed a model based on provisions for the capital allowance deduction scheme (see Division 40 of the Income Tax Assessment Act 1997), which will not allow for software or services.

This may have been caused by rushed processes in drafting a quick handout to small business; we can hope for a review in the final version due out late this month.

The exclusion of software and services will make for some interesting debates when hardware is sold with software included in the price, and will certainly lead to an additional administrative load in determining the tax benefit to claim.

I am sure it will also impact on people's decisions to invest in infrastructure that forms only part of the cost of any implementation, software and services typically making up some 60% to 70% of the total cost of any IT project.

If we are to get the productivity gains this country so badly needs in the SME sector, surely we can all call on the Government to lift its game and ensure that the full cost of implementing IT assets into businesses are covered by this tax break.

The provisions are outlined in the Tax Laws Amendment (Small Business and General Business Tax Break) bill 2009 (exposure draft).


David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector

Where Do I Get Help with My Software?

Have you ever tried to get support on your custom business application from your IT guy?

My clients need assistance at all sorts of levels with their software, and most of the time it is beyond our skill set to provide assistance. This is not embarrassing for us, this is normal for our complex industry. The solution is to build sound three-way relationships between you, IT support people like us, and the people who know their software.

Each industry has its own unique applications, from Apparel21 for clothing manufacture and distribution to Rockend for real estate agents and IMIS for member-based organisations. There are literally thousands of programs to support, and you don't use yours the same way everyone else uses theirs.

Sensible software development companies realise that their skills are in industry expertise and software development. So they move away from technical support of your computers and the need for this three-way relationship is required.

Sometimes it gets one more step removed when the application is something like SAP or Salesforce.com, because SAP and Salesforce.com cannot provide affordable services to the SME client directly and a third party software consultant is required to help you with implementation and on-going support/enhancements specific to your business.

For each of these applications it takes months and even years of training to become an expert at managing and using it within a business. The cost of this is too high for a technical service company to look after more than one or two applications well.

The solution is about building the right relationships between you, your IT support guy, the software vendor and your consulting partner.

So the method for getting good support for your complete IT system, which may include multiple custom applications and a range of hardware solutions, is to find a company that plays well with others to create a solution that works well for your business.

You need to quiz your IT support company to ensure that they are happy to contact your software vendors and consultants to ensure that relationship works and problems will not "fall in the gaps", as this is where lost time and increased costs of managing your IT systems comes from.

It is important that your technical services people have a healthy respect for application development and support to ensure they are capable of building and maintaining the three-way relationship. If the tech guys are too overbearing or pushy, the developers and consultants will not come to the table to agree to solutions that require co-operation from all parties.

And if your application providers are promising to support your computer network too - beware! They are unlikely to be very bothered about or skilled in any part of your network that isn't specifically related to their software application.

Go ahead and share your experiences with me!

David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Can IT Tools Help with my Financial Management?

If you run a business, chances are that in the past three months someone has told you that now is the time to manage your cashflow. They have suggested cost cutting and tightening your payment terms and collection policies.

I certainly have heard all of this advice in many of the industry briefings I attend, also in articles here on SmartCompany, and even in the SmartCompany forums. All of it is sound advice.

So as working capital management becomes critical and as equity and debt funding evaporates, tight credit and inventory management and constant cashflow monitoring are the keys to survival.

But you cannot manage what you do not measure, and therein lies the hitch for SMEs. Executive reporting systems that provide key information on as near to real time as possible become critical. Gartner says it is crucial to be able to see last month's figures by the 21st day of the following month.

This means good record keeping and great systems for recording and reporting. It may also require integration of key business systems to roll data into central reports. If you track people in one system and money in another you may not know the real cost of your efforts until it is too late.

The use of digital dashboards - where key information can be tailored to those who need it to manage in a timely and accurate manner - is the key to following through on all of the advice given by the economic gurus of our time.

A simple example from my business: We have carefully integrated our financial reporting system (which contains creditor information of who is on credit warning and credit stop) with our ticketing system, so new jobs are not booked for our slow payers. This is simple enough to do manually, but on a larger scale of multiple transactions, the automation becomes important to remove the opportunity for error.

In any business with multiple employees, whether it is a services business or a product-based business, there are numbers to track and actions to take based on the numbers.

My question to each business owner is: Are your systems strong enough to give you timely reports that let you take the critical action required to stay at the top of your game?
I look forward to your comments on this one!

David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Ignore the Advice; Don't Cut Back on IT

I recently attended the 2009 Gartner technology briefing, along with some of Melbourne's leading CIOs from IBM, Telstra, ANZ and other big organisations. The dominating topic was on the cutbacks in IT spending that we should expect in 2009.The presenter was telling us that in 2009 we should see companies looking to maintain profits by cutting back on IT spending. He went on to explain that in the last recession, companies invested in systems that improved productivity and reduced operational costs.

Over the past years, companies have been spending money on IT systems such as CRM applications and ERP solutions that permit EDI and business process automation as well as reporting that permits faster reaction and better decision making. The incremental improvements available today do not justify additional work during this downturn.

His advice was to review all IT projects and close down all possible projects swiftly - now is the time for cutbacks and bare-bones maintenance.

This prompted me to ask a question: "Can you define the market place you suggest this strategy for, and comment on the relevance of this statement for the SME sector?"

Boy, had I asked the right question. The speaker stated quite clearly that his comments focused on the corporate and government sectors, and absolutely did not apply to the SME sector, which had really only installed computers since the last recession and are now desperately in need of the productivity tools the corporate sector have been using for years.

I was very pleased with this response as it reflected my own experience and observations.
Many of our country's smaller businesses, which employ the bulk of our population, are behind in their business process automation and are in need of help. This is hardly a revelation, but our SMEs are too busy fighting for survival to heed the message.

So the very important message for Australia's SME community is that the way to stay strong in this downturn is to invest in IT systems. Yes, I have a vested interest in this, because I set my business up to service this growing demand in the SME sector back in 2002. But the need is real.

The good news for the SME sector is that since Microsoft released Windows Small Business Server in 2003, there have been some solid solutions for the SME sector developed by many of the corporate software makers such as SAP, Microsoft and Oracle among a host of others.

Many SME business owners have implemented the infrastructure and are ready to go to the next level of automation and reporting. Many of those solutions are now being hosted in the cloud as well giving us a wide range of choice for productivity increases.

In 2009 it is time to look at this issue and seek the latest solutions for your business. This is the year to keep the money coming in and reduce your labor costs. If you can grow the top line as well, you will be truly ready for the impending upturn.

David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Don't be Left Behind by Your Own Success

Setting up good systems is a complex proposition that takes time and costs money. If you don't spend the money, it will cost you more in the long run. You certainly can't grow without them.

There is good correlation between successful businesses and good information systems. Unless you discovered a wonderful niche where the clients are lining up, the costs are low and the barriers to entry high, chances are you need systems.

Let's look at an example:

If your business is delivering water to country homes that are not mains connected, all you need is a mobile phone and a truck to get going. You can get by with an order book and an invoice book.

Now imagine you have grown to have 20 trucks on the road staffed by 35 drivers doing 135 deliveries a day. There are four full-time staff in the office and three sales staff out on the road to keep the 135 jobs a day coming in.

Your simple business just got complicated by scale, and systems are needed.

For starters you are probably sending out 2700 invoices per month. If you could get 50% of these invoices to be automatically generated and sent by email, you could save $675 per month on stamps, $500 on printing and envelopes, $500 on admin time and you may even get paid days sooner, saving you $500 a month in interest due to improved cashflow reducing your overdraft.

Now look at route planning technology, that sorts your deliveries by region and reduces your travel time by one hour per day per truck, and gives you the ability to increase deliveries by 10% without increased cost.

In short, as you grow and your small business gets to be bigger, the only way to beat the smaller startups in your own industry is to have economies of scale through smart systems. If you intend to beat your competition, start looking for the best systems and invest time and money to get ahead.

So, here is a shopping list for you, in the order they are typically needed in a business.

Infrastructure: These are the servers, PCs, laptops and other mobile devices, terminals, networks, security and back-up systems that your business systems rely on. If you expect everything to just work together without design, your people are probably spending more time mucking around with their computers than doing the jobs you pay them for.

Email: Your business needs to make sure it is stable, reliable and secure. You might start with Gmail or Yahoo, but may need more soon, such as shared calendars, domain hosting, archiving and backup solutions. Then get really smart and hook your email up to your customer relationship management (CRM) or document management so that key emails are shared knowledge.

File storage: This very simple component is still done badly by many organisations, but the idea is to centralise your files, keep them secure, and create backups of them. Avoid multiple versions across multiple hard drives. Avoid key information being stored on local hard drives or in local email folders.

Delivery systems: These are industry specific, but no matter how simple your business is, as it grows to be done by multiple people your business processes must be automated to create a consistent, efficient and quality outcome. In many cases your delivery systems should drive your choices of ALL your other systems - because ideally you want to buy delivery systems which integrate to all the other systems in your business.

Also, wherever possible, you should buy a system that is built for your industry that incorporates best practice for that industry. Do NOT build your own unless you have a clear strategy to be a market leader in your industry and can invest the hundreds of thousands of dollars needed to make it work properly.

Financial systems: Managing money successfully in business does not happen by accident. Apart from the tax and legal implications, a good financial system provides regular indicators of what is working in your business and what isn't, and where you are spending resources. Then integrate it with your delivery system.

CRM systems: These may be general or industry specific but they help you keep track of interactions with people and other organizations. They are the key to sales growth and should be part of your marketing strategy. Once you get the basics right, you can then extend CRM to integrate all your sales and delivery systems so that your whole business knows what any prospect or client is up to.

Document management systems: If the only way anyone can find information in your business is by asking a key person where it is, your business is at risk. One of these in your business as you grow can assist with the storage and recall of information and can create massive productivity gains when multiple people deal with documents.

You can keep adding as you grow. Web sites, HR, payroll, auto responders, project management, CAD, CAM, GIS and so many more. Whatever it is, get good advice early to avoid investment in the wrong solutions.

Just contemplate what it would take to grow from 20 trucks to 100. Often it is the scalability of the systems that determines the growth factor for the business. I say this having grown my service business an average of 70% a year over three consecutive years.


David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Tough Times and Tech Solutions

When the going gets tough, business leaders need to motivate and lead their teams to success. We cannot offer huge financial rewards when sales are slower, so we need to focus on other forms of motivation.

There are lots of ways to motivate people other than direct financial rewards. As a reformed nerd, I lean towards IT and the digital age for tools that can be used for team motivation.

In tough times communities pull together, and these days communities are forming in the cloud with web 2.0 technologies. This is offering us tools that can, if used intelligently in business, aid the development of internal and external communities in teams as small as two or three people. I use the term "team" loosely here, as it may be that people are part of multiple teams in small companies, but the concept is the same.

Communities can extend to clients or test groups or others - I will leave this to your imagination. The important concept here is strong communication using community based tools that build stronger relationships that transcend depressing external influences.

Think about using intranets, wikis, online learning, telecommuting and other digitally enabled products to enhance the employee experience and improve and enhance the work environment. Get people tuned in to Facebook or LinkedIn groups, send broadcasts via Twitter to get more buy-in from your communities. You will find me on Twitter as you will find SmartCompany working on expanded and improved communities.

Staff who are engaged in communities are less likely to feel isolated and thus derive more satisfaction from their work. This can include new methods of encouraging innovation or sharing of knowledge to improve speed of resolution.

We have wikis for our marketing department and their projects as well as for our technical solutions team for their projects and solutions. These tools are improving our communities but they are also improving our efficiency and productivity.

If these tools are too new for you as the company leader, it may be time to lean on your Gen-Y team members for ideas on how to improve the digital communities within your business. There is clearly a trend towards these technologies in the downturn we are experiencing. One of the biggest motivators for the adoption of many of these technologies is the very low cost of entry.

Finally, we should all spare a thought for the businesses affected by the bushfires. I have been delighted by the action of the Australian Information Industry Association which has set up a web page to allow businesses to provide their part of an IT solution.

At times like this, there are community organisations that require systems as well as businesses that have had their entire IT infrastructure destroyed in their burned out offices. Literally hundreds of computers are needed and the expertise to connect them up and make them useful.
AIIA has taken the initiative to create a web site that lets companies register to provide any part of the equipment or services required. This is a great example of how modern technology can reduce the amount of administrative effort required to provide fast services in times of great need.


David Markus is the founder of Melbourne's IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

Think before you cut back on IT

Why do we put up with computers and all the problems they create and the expense of them when we are trying to cut costs? Shouldn’t we just throw them away and do without them?

I get this sentiment from people all the time. As a business owner I share the emotions, but as a manager, I know better.

We run a business that tracks thousands of job tickets. Each job ticket must be worked on by multiple people to pass from admin to technical to finance and on to the client as an invoice or statement. I know that each ticket has an administrative cost to it. My aim as a business owner is therefore to have more tickets handled faster by fewer people.

So my aim is to use computers to manage tickets more efficiently. The more the process can be automated, the better my profits will be. The faster my technicians can access information, the quicker they can resolve issues.

By resolving issues faster they reduce the cost of each issue and make us a better company to work with.

We also use computers to generate marketing material and to track client communications and sales conversations. All in all, we gain a lot from computers.

If our computers fail we simply cannot keep track of all the tasks and cannot process the volume of data our business must handle. Even a 20% decrease in efficiency would cause us to lose many clients and would certainly increase our costs to the point where we could no longer remain a viable business.

So the decisions for us are simple – spend as much as we need to on IT to be able to process our work at a rate that keeps us in business.

I suggest you quiet your emotional noise for a while, and look at the systems in your business that do run on computers or could run on computers, and work out the real cost in dollars per hour for the people that perform those tasks and think about how much more effective your business would be if that process were better automated.

Don’t get hung up on how you would automate it – that is a job for IT experts. Just figure out what processes you have that could be or should be automated or improved, and you will find how you can use IT in a downturn to improve your business.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT systems for the SME sector.

First Pants then Shoes

We all know the firing squad drill from the movies: “Ready, Aim, Fire!”

But have you ever heard anyone say “Fire! Ready, Aim”? Of course not, because it sounds absurd – so why do we do it over and over with computers?
By David Markus

We select the computer, buy some software and get started using it. This is Fire (buy the hardware), Aim (buy the software), Ready (figure out what we will use the software for).

Surely a more sensible approach to spending vast amounts of money on IT would be to stop and collect ideas on what operations the software needs to perform in the business – then you are Ready.

Start by designing some business processes that need to be performed by the software. Now you can select the right versions of software and determine the fit for your business before you commit to the expense. You may spend a few days in design and testing to determine the best solution, but you won’t be stuck with the wrong solution for years. Now you have taken Aim.

Once you have selected the best solution, you are ready to design the infrastructure required and put it all together – now you can “fire” off the order with confidence. It sounds simple, but it is very rarely done well in small businesses, and I would like to share my view on why.

If you have a business leader who is driven by results, they may not be brilliant at stopping to express their design requirements to the team. They see the need for a solution and dictate the “Fire! Aim, Ready” methodology by saying something like “get me a computer with a finance package on it so we can do our accounts”.

This leader may have kept accounts at some point in a glorious career, but probably still thinks it can all be done on a spreadsheet or simple application. They will not stop to contemplate the complex components of the business such as multiple currencies or trust accounting, tracking inventory or supply chain management.

So unrealistic time scales are created and a solution is put on the desk over the next day or two. For the next few years the business will struggle on with this application, customising it and finding workarounds and add-ons.

As the business grows to the limits of the software, the “Ready Aim Fire!” method becomes the company’s only hope of salvation in moving to a better solution that frees the company up from hideous, time consuming processes.

Don’t let your growth be held back by poorly planned solutions. Be brave, steady yourself, get Ready, take Aim and Fire off the best solutions for your business!

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

Put Your IT Costs on a Diet

There has been a lot of noise about net computers, thin clients or terminal devices. Same stuff, different names. The idea is that the processing is done by a central computer and the graphics are viewed on your screen anywhere in the world.

This is not new technology, but it has evolved to the point where videos and sound files play just fine. So now there is a raft of emerging technology for the SME sector that will create all the business tools on a central server and let staff access them from anywhere in the office or on the net.

Many of our clients and other SMEs already use a terminal server to do this, but are not yet getting all the benefits of accelerated sound and graphics. In fact I am sitting in my home office using a terminal as I write this article as I do not have a PC at home. Fancy that – an IT geek with no PC.

I could try to throw lots of technology at you to explain why this is so exciting to me, but I am going to resist. Contact me if you want to know more about the technology side. I will instead focus on why you can save a fortune by deploying this technology in 2009.

First and foremost, this is a well understood technology from the technologists’ end, so it is very manageable. This can lead to good stability and increased productivity in your business.

Management is performed on a central server that can be located anywhere – in your office, my office, or a data centre. There is no need to configure the thin clients, so once it is built, expansion to more people in your organisation is simple.

As an application is installed once on the server, everyone can start using it immediately. Software and security upgrades are done once, and apply to all users. Thus management of a terminal-based client is a fraction of the cost of managing a PC-based client – one system to control, one system to manage, less variation so less expense.

The technology works really well over 3G wireless broadband, so mobile thin clients can work well also. The telcos won’t like it though, as the technology does not use much data download over the 3G network so they can’t make too much money off you.

Speaking of which, here is the next very cool step for SMEs.

In 2009 you will be able to set this up on a service basis, so you don’t even need to purchase the hardware or software, you just pay a monthly price per server and per client and it is turned on for you. The idea of a breakdown or paying for IT services could become a thing of the past.
The vision is for a one-box solution that has ”managed everything” including on-line automated backup.

There is one question you could answer for me though – would you trust the big telcos to manage the hardware and connections for you, or would you want a company you can reach out and touch?

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector

Top Technologies for 2009

The growth in technologies over the year has been amazing, and next year looks even better. Here are the top 10.
By David Markus

Recently Gartner published its list of top 10 technologies for 2009. I have grabbed last year’s list and this year’s list and give you both for a comparison. I have then added a short comment on what each means to us in the SME arena.

Gartner's 2008 list

• Green IT
• Unified communications
• Business process management
• Metadata management
• Virtualisation
• Mashups
• The web platform
• Computing fabric
• Real world web
• Social software

Gartner's 2009 list

1. Virtualisation. This has leapt up the list as it is extending beyond just server virtualisation and offers the best solutions for cost reduction and hardware consolidation, thus reducing real estate requirements, power used and environmental impact. In 2009 virtualisation is hitting storage and desktops as well. For the SME marketplace there will be scaled down versions that help.

2. Cloud computing. Also rated the most hyped of the technologies on the list, this will begin to change rules as hardware is no longer needed to access software, changing business processes and making companies leaner and faster. Cloud computing is moving beyond SAAS into entire servers and storage in the cloud. I will be writing about this a lot in 2009. Send your questions in now.

3. Computing fabrics. This concept is for the big boys with very expensive computers where they can shift applications from processor to processor and select the memory and storage required dynamically on a super computer that is shared by multiple applications and platforms. We don’t need to give this one too much thought.

4. Web-oriented architecture. Good news for all of us that are not web developers is that this is a set of rules on how web stuff should be done and the rest of us can leave it to them as work with it. If you are a web developer, look it up.

5. Enterprise mashups. This is more a use of technology than a technology in its self. Mashups may have an impact for us if we are web savvy and want to use information on the web inside our business applications. The simplest example of a mashup is the programming of our CRM address book to open an on-line street directory showing the address.

6. Specialised systems. This is talking about purpose built boxes for storage or security or web filtering. A specialised system does just one thing – it may be programmable but its generally set and forget. We probably have one in our business but we may be adding more in 2009 as cost effective solutions for specific problems like spam filtering.

7. Social software and social networking. We may well see more use of tools like LinkedIn and Facebook for jobs such as recruiting, sales and marketing in 2009. Well worth thinking about for cost savings in communicating with a mass of people you do not know yet.

8. Unified communications. This has slipped for the enterprise list but I am confident that it is much higher up the list for SME companies who have not yet updated phone systems to take advantage of this technology.

9. Business intelligence. Only the larger SME companies will have the means to extend business intelligence by applying BI analytics into their business processes. Not one for most of us to worry about just yet, although I believe it will create great value for those that use it.

10. Green IT. In my opinion this one needs to be pushed back up the list to number one, as we face so many environmental issues with the way IT is run today. Refer to my previous articles on Ewaste and green house gas emissions.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

The e-waste Challenge

Should we have a levy on electronics equipment, and will it help?
By David Markus


Would a levy to help with e-waste help a growing problem?

Let’s start by looking at the size of the problem. According to the ABS, household use of computers is growing. In 2006/07 there were 5.1 million homes with internet access, so we assume 5.1 million computers.

Obviously there are more in use in industry and many homes have more than one PC, so let’s assume conservatively that Australia has 10 million computers. In general computers are replaced every two to eight years let’s be generous and assume an average life of five years. So every year at least two million computers are being disposed of in Australia.

Dumping e-waste in landfill means toxic heavy metals including lead, mercury and cadmium may make their way into soil and groundwater.The management of Sims Group (a worldwide recycling company) is getting vocal about this with their general manager of sustainability, Peter Netchaef, proposing the Federal Government impose a levy on imported computers to curb the build-up of electronic waste.

More importantly Jeremy Sutcliffe, executive director of Sims Recycling Solutions, called for the Government to act now on compulsory legislation regarding the recycling of e-waste.According to Sutcliffe, e-recycling rates in Australia have been very poor, with less than 4% of the e-waste generated being processed.

Compare this to countries that have introduced stewardship programs and e-recycling legislation, including all countries in the EU, some states in the US, Japan and Korea, which now have e-waste recycling rates in excess of 80%.

Australia also has lower standards for hazardous materials and I personally have been offered cheap batches of machines that have been ex-EU where they could not be sold due to non-compliance for content. Without tougher requirements Australia will become a dumping ground for products deemed contaminated in the US, EU and Japan.

We are at the mercy of our legislators on this one.

So what can we do to reduce our impact on this?

First, we can ask for clear information on the toxic components in our computers and compare them against international standards.

Second, we can reduce storage of retired machines and pass them to legitimate recyclers so they get a second useful life before being scrapped. Many not-for-profit organisations will re-use two to four year old PCs, so don’t just stick it aside in case you need it later.

As Australians we tend to hang on to our computers until they are no use to anyone. By the time they go to the recyclers they are being broken down into useable parts and raw materials.
According to estimates it costs around $30 to recycle the materials here in Australia while in countries such as China it can be as little as $2, so much of the world’s hazardous waste is being sent to the third world for manual separation.

At this point we should all know about the Basel Convention which came into force in 1992. It aims to protect human health and the environment against the adverse effects resulting from the generation, management, trans-boundary movements and disposal of hazardous and other wastes.

Basel Action group recently published an article generated by 60 Minutes journalists on the topic of breaking down e-waste. It was not a pretty picture, with entire villages in third world countries being polluted and workers absorbing poisons that will last generations over the instant pain of poverty.

If Australia does not want to be a source of toxic waste, we need to look to our manufacturing standards and ensure we do not permit higher levels of toxins than our counterparts like the US and the EU.

We must start to think ahead and plan the inevitable destruction of every electronic device we manufacture or import to ensure we are not building a toxic stockpile for future generations.
Whether we impose a levy now or pay for it later through clean up efforts, we will pay for it nonetheless.

We could start looking at how to reduce planned obsolescence and build equipment with modular components designed for continual upgrades rather than complete exchange.This is not a problem consumers are yet empowered to fix, but we can start asking for solutions from the technology companies. We can also start looking at our toxic foot prints and seeking smarter and cleaner solutions.

Please do look up your local clean computer recycler and think disposal before you buy more electronic equipment.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

The Breakthrough Backup System

We have all heard enough horror stories to know how important effective back-up is. Now there is a better solution for SMEs.
By David Markus

In small to medium business, backup and disaster recovery are complex problems that typically have been expensive to address. Large corporate firms can afford fail-safe solutions and mirror sites that significantly reduce risk. Until recently, the best solution for SMEs has been tape backup.

There is always a risk that a server will crash and cause a lot of pain to a business through lost data and downtime waiting on repairs. Many wise businesses follow a strategy of keeping server hardware current to avoid a lengthy wait for replacement parts. If you have multiple servers in your network today and no plans to replace them, there may be a quick and sound alternative.

I have been watching the evolution of disaster recovery solutions for the SME marketplace for over six years. I installed my first remote backup solutions in 2002. Since then nothing much has changed and it has been a reasonable but expensive solution. Now in late 2008 I have discovered a breakthrough backup system, one that changes the game and makes this a compelling and affordable solution for most SMEs.

The secret lies in neat integration of the latest backup and disaster recovery technologies. Solutions exist today – examples include products from BizProtect, Cebridge and Iron Mountain – that can protect multiple servers and provide a one hour recovery window using a fully automated and monitored backup process.

This technology scales from one to 10 servers protected by a single solution with snapshots of your data being taken several times each hour. The changes to your data are collected and stored centrally and at a moment’s notice can be consolidated and launched as a virtual server. This virtual server can be run for as long as required, allowing the business to function while the failed equipment is repaired or replaced.

Data is also encrypted and stored off site via the internet, providing a full disaster recovery path in the unfortunate case of an office fire, flood or similar catastrophe.

One of the amazing features of this technology is that it can all be managed remotely and your virtual server can be online within about one hour of a server failure. So now the smallest of organisations can have corporate-style server fail-safe plans.

We are seeing this solution remove the risk of server failure for many clients who were facing very expensive server replacement projects just to manage risk.

At a time when liquidity is short and reputation is important, this is likely to be a key technology for finance companies, funds managers, accountants and law firms in 2009. It is equally valuable to any organisation that values continued access to data even in the event of server crashes or failure.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

Ahead in the Cloud

The new technology of cloud computing could be the answer SMEs are looking for.
By David Markus


If your business has grown over time, you have no doubt bought expensive software that fitted well for a while but failed to grow with you. Upgrades are time consuming and can be complex and costly, and custom development is out of the question due to huge ongoing costs – the choices have to date been limited.

The new technology of cloud computing could be the answer SMEs are looking for.

To illustrate the possibilities offered by cloud computing, I like to use the analogy of the office. As a fast growing business I have been forced to relocate a few times and seriously struggle with a three year lease as being too constrictive. In six years we have had three offices, and are just about ready for the fourth.

So what would a ”cloud” office offer? The cloud office may start as one of those serviced offices where you basically have a street address and occasionally hire a meeting room to conduct business. You then add some staff and take a managed office in the facility.

You make use of a shared receptionist and appear to be a large company to anyone that visits. You expand interstate and use the same managed office company to start your new office, the networks are in place, and it works well.

But then you have success with your business and need to relocate to your own building, set up your own systems at great expense, probably just as you are investing heavily in new staff and additional sales and marketing effort. Ouch…

Cloud computing offers truly scalable services that let you select your level of engagement and upgrade seamlessly at any future point. Today there are many examples of cloud computing that we all use, such as Google to index the web, Amazon.com to find the book we want, Facebook.com for social networking.

In terms of business applications, one of the most prevalent examples of this is Salesforce.com, which is a web-based database product with its roots in sales process automation and CRM. This product offers an entry level service for a single license and seamlessly expands from there. At the large end of the scale there are businesses working globally on this platform with tens of thousands of licenses for a single entity.

If you just want a server platform without having to buy hardware you can use the “in the cloud” services of a company such as Amazon.com, which now offers virtual servers that let you do your own thing. Need another server? Just turn on another one and pay the fee. By the end of 2008, Amazon is also planning to release Microsoft servers as a service.

Not to be outdone, Microsoft will shortly offer the Office suite as a cloud service – you no longer need to buy and install office products, you can subscribe and log in and use them as you need them. There will be cut down versions accessible from your mobile phone so you can really work on the run.

If this model of use was applied to office space, you would move into the ground floor of an empty skyscraper, pay $99 in rent for the first office space and slowly take over the entire building without any conflict with other tenants.

If you would like to know more about cloud computing drop me a line at blog@combo.com.au

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

Your IT is as Good as the Talent that Supports it.

Every business with more than a few PCs needs IT talent. The larger or more technology dependant your company is, the more talent you need.
By David Markus


I frequently find small and medium businesses with as few as 20 staff employing a young IT person to work for them. This person often is expected to advise, manage and fix all the technologies within the business – and is often quite simply not capable of the task.

Recently I was called in to a finance company that had a high demand for IT systems and so hired a young university graduate to look after their computers in-house. They believed that having a full time resource with the right qualifications would give the best results for their organisation.

Unfortunately universities do not teach the best practical skills, and the young graduate failed to establish suitable disaster recovery systems, which lead to a several-day outage after a hardware failure. The graduate also had a poor understanding of business, and took the approach of implementing cheap hardware solutions for the company to “save them money”.
Over time the infrastructure was de-stabilised to the point that it was costing the organisation significantly in downtime when staff could not access information or process orders.

The two edges of the sword are that keeping the talent close and having them know your system is good, but having only one or two people in your IT department is a high-risk, high-cost approach to solving the problem.

The most expensive part of IT is the services – if the talent you employ full time lacks the skills you require, it can be very expensive to train the resource or supplement the skill set.

Today with remote management technology being as advanced as it is, companies of any size can benefit from replacing or supplementing in-house technical resources with outsourced arrangements.

This way you can tap into a pool of talented people with a wide mix of technical capabilities. You then benefit from the experience these consultants gain on other sites, get a better managed system, and faster, smoother upgrades when your technology needs it.

If you have over 100 computers, a mix of in-house strategic management and junior support with outsourced mid-level support can work very well. You can even gain a fully managed help desk that keeps your in-house technical resource well managed for you, ensuring your IT services budget is spent as efficiently as possible.

If you have less than 100 staff it might be time to consider outsourcing the entire support role to reduce costs and improve productivity.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

Greening Your IT

Did you know that computers and aeroplanes are emitting similar levels of green house gasses?
By David Markus

The aviation industry is estimated to be creating 2% of the worlds carbon output, as are our computers. Many of us will be familiar with the option to pay our carbon offsets on a per-flight basis, but most of us are not paying carbon offsets for our computers quite yet.

According to a study published by Gartner group in February 2008, our PCs and monitors are contributing 39% of the IT CO2 emissions, while servers are contributing 23% – the rest of the CO2 from IT comes from our networks, telecoms and printers.

Studies in the US suggest that it takes just three trees planted each year to offset a PC’s contribution based on 10 hours a day of effective use. Over the four year life of a PC, that is 12 new trees. I am not suggesting that tree planting is the best carbon offset solution, but it is just nicely quantifiable for this example.

The question is; how can we move to reduce this carbon footprint over the next few years given that our businesses and homes are full of computer technology?

My answer is in consolidation of equipment and reduction in power demands of our IT equipment. Current trends – especially in small business – are to have one server per application or database. Over the next few years we need to get better at running our entire business off one server platform and that platform needs to become more energy efficient.

The next step in this server virtualisation is to remove servers from small business altogether. Through virtualisation of servers, it is now becoming possible for a hosting organisation to host multiple organisations’ servers virtually on one hardware platform, thus increasing the efficiency and utilisation of processors, data storage and power facilities.

As our broadband services increase in speed, it will become possible for most organisations to simply access servers ”by the slice” across the web at a fraction of the cost of owning and maintaining the hardware themselves and at a fraction of the environmental impact.

In the mean time, the simplest thing we can do is turn our PCs off as we go home!If you have other IT energy saving ideas please let me know by commenting below. I would love to put together a list of your ideas for a future article.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

The Business Trinity

Wages, rent... and why an IT plan must be part of your business plan.

By David Markus


It would seem the business world has not yet caught up with the fact that IT is the third fixed expense in business after wages and rent. Yet very few business plans have a component called “IT plan”.

Planning to have each department in your business up-to-date with technology is an ongoing process of aligning your purpose and solutions. Clearly the IT plan should be part of your business plan and should support this with the technologies selected.

An IT plan:

• Should be part of your business plan.
• Indicates how technology supports your future direction.
• Explores emerging technology.
• Includes security considerations.
• Examines best-of-breed for your industry.
• Must include a budget if anything is to work.

Your IT plan should boil down to “How will technology support our future?” This will determine whether IT will manage to make a difference. Once you know where you are going, you can select the right solutions to get there.

Make sure your solutions are selected to support the business you are running today to ensure you remain competitive and in business for the next few years. Forward planning at a central level in any business is essential to reduce the number of different applications that need to be integrated later. One only needs to look at Telstra to see the effects of different departments referring to different customer records.


Where to start

Start by looking at the technologies that could help evolve and change the future of your business. What technologies will it be for you? You need to consider:

• Mobility.
• Document management.
• Unified communications.
• E-mail marketing.
• Finance.
• Web-sites.
• Search engine optimisation.

Choosing the right products

Small business often lacks the analytic skills to know which solutions are right for them. This is why I recommend asking the question; what is the best-of-breed solution for this type of problem?

A great idea is to look at the products used by large multinational companies and then see what has been scaled down to do the same for your small business. Once you have found the best-of-breed practise, you can use comparisons to determine the value and match of lesser products. But remember, you may find it is very hard to justify the small cost savings offered by lesser products.


Security

No business plan is complete without a risk analysis and so we must touch on both security and disaster recovery. While there are plenty of solutions to security threats and network intrusions, it is only a matter of time before new threats emerge, so it essential that we plan to maintain security.

Also make sure you consider aspects of privacy and protection from fraud.


Budget

To get the lowest total cost of ownership you need to plan your spending with the big picture in mind. Key areas of expenditure include; consulting, software, hardware, installation and maintenance/helpdesk services.

With each part of your IT plan supporting your business, you can now structure your finances to ensure manageability and lowest total cost of ownership


The next big IT issue

When we are looking at an IT plan for the years ahead, we also need to contemplate the arising issues in the business world. By far the biggest issue facing the human race in the next 50 years is global warming.

When we are planning expansion or replacement of our existing IT equipment we need to be guiding our companies to make better choices, with lower power consumption and greener manufacturing methodologies. We need to look at recycling old equipment and reducing landfill created by the short life cycles of our equipment.

Trends in our industry that will assist with this reduction of impact include hosted servers and hosted software. This is reducing the need for under utilised on-site equipment. This, like many green initiatives, is using smarter technology to reduce impact but also reduce the total cost of ownership.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

Tough Love on Hardware

Over time, the lesson on the true cost of cutting corners has been drummed home.
By David Markus

The cost paradigm has shifted. Once upon a time the rule of thumb to IT costs was 1/3 hardware, 1/3 software and 1/3 tnstallation and services. That was when a PC cost $4000 and software was expensive.

Today computers are cheap and software is cheaper than it once was if you are buying common desktop applications. However, the complexity of management is such that no one individual can manage all of your technology alone anymore. So now my rule of thumb is hardware 10%, software 25%, installation and maintenance 65%. Contact me if you want to haggle on the details of this.

Any business owner knows that the ultimate discipline in running a business is expense. When we cut corners in the setup of our business it costs us money later. This is true of our HR policies, our accounting practises and collection practises, and is also true of our IT systems, both hardware and software.

My point is that saving money by purchasing cheap hardware is a false economy, as the downtime and additional services required over a three to four year period of ownership are far higher than the cost of getting the right hardware first time. Standardising on one style and one brand will lead to the lowest total cost of ownership possible.

As to my own experience, when I started Combo in 2002 I started selling cheap PCs. They were made of quality parts but they were not top-shelf. Over time I found that one in 20 PCs on average was delivered from the distributor to my clients in a non-working state or failed within 24 hours of delivery. In each case, hours of hassle followed to get the hardware replaced.

In over five years since we started selling top brand equipment, only a couple of PCs have failed in the same way, and in each case one phone call to HP saw them fixed within 24 hours with no additional expense to myself or the clients.

I have many examples of hardware faults causing days of downtime for clients that have come to us during or after these disastrous periods. It just is not worth the extra cost to your business.
So before you make another hardware purchase think about the benefits of consistent performance and limited downtime. It will inevitably justify the additional expense on quality equipment up front.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

Integrate to the Top

Are your spreadsheets telling you to develop an application?
By David Markus

Many small business owners start their business on a spreadsheet and struggle to evolve. The accounting system doesn’t talk to your quoting system, your email marketing is running from somebody’s Outlook contacts instead of your customer database, and you have three different systems for managing other things in your business that just evolved over time.

Did I mention your website? Let’s not even talk about where leads from your website end up.
We frequently discover businesses in this state. They often have the same lament: “I run a unique business, I can’t just buy an application that works for us because no one can predict my needs.”

This is a warning sign to us, as software development is a specialised field and usually an expensive proposition. If you embark on development of a custom application you are likely to develop something that works well with a small static component of your business, but fails to integrate with applications used by other parts of the business.

The key to smooth, productive work environments is integrated software. Whether you run a services based company as I do, or a manufacturing or sales based organisation, there is software developed that will fit your business to within 80% of your needs and require a little extra effort in integration, reporting or data capture to enable your business to be tightly integrated and highly productive.

So you have a few choices.

Buy an off-the-shelf package that is specific to your industry and change your work practises to fit around the capability of the package (customising and configuring it as much as possible).

Engage a development/integration partner to build you something that integrates (and be prepared to spend big money with the vendor, plus you need to hire internal resources to write the specifications and manage the delivery).

Look for something that gives you an 80% solution that could potentially cover 80% of your business needs and start planning your migration to it, strategically and in small steps.

Well, there’s the fourth option - do nothing. But we won’t talk about that, as it is unlikely to make your business problems go away.

If there is an area of your business you would like to automate let me know and I may write about solutions to your needs in future articles.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.

Clouds are forming, should we wait for the reign?

Can web-based applications provide for all your business needs?
By David Markus

Software as a Service (SaaS) or Cloud computing is all the buzz at the moment and may well reign supreme in the business world of the future, but should SMEs be looking there for solutions to business problems today?

A quick definition is in order. SaaS refers to applications where one simply uses a feature online without needing to install software.Google, eBay, Facebook, YouTube and Amazon are all well known consumer-based examples that we all use or have heard of.

Today, many business owners are looking for productivity tools to ensure they remain competitive in the turbulent times ahead. One solution is to implement software that improves business process and ensures your business remains competitive. Choice lies between traditional software installed on your equipment and SaaS. The problem is how to correctly identify the technology that will give the best value and the best competitive advantage.

I have been dealing with a recruitment firm lately that also works on consulting and other aspects in their vertical market. They could use traditional recruitment software just like their competitors, but have seen advantages in adopting a web-based application that gives them the ability to store resumes online and cross reference those for matching purposes.

Today there are some established alternatives to buying hardware and software to run inside your business that offer significant benefit over doing it yourself. Now there are emerging options for hosted accounting and CRM software. Even ERP and document management can be performed on hosted applications.

By combining features of a well known SaaS CRM application and online content storage and searching, our client has been able to solve their particular issues with a unique solution. Now they can open up in new locations without complex networking or infrastructure concerns and can also access their data from client sites without the major security issues usually linked with remote access to back-office applications, no VPNs or terminal sessions required.

Generally speaking, it is still early days for Cloud computing and it is worth asking lots of good questions before endorsing or dismissing it as an option for your business. For example, it is very important to understand the real costs of infrastructure before committing to the ongoing expense of SaaS. You must also consider integration of SaaS with your existing business applications, and localisation of the applications to Australian conditions and regulations.

David Markus is the founder of Melbourne’s IT services company Combo. His focus is on big picture thinking to create value in IT Services for the SME sector.