September 13, 2010

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“More with less” has been the business mantra since the economy collapsed two years ago. That’s fine, to a point, but companies that should be investing in information technology may still be burdened with frozen budgets.

Whether we emerge from this financial crater soon, or continue to bump through uncertain times, your small business can’t afford to sit on the sidelines while your competitors invest in upgrades. 

So what’s the key to making smart IT investments? In a nutshell, everything begins and ends with your customers. When evaluating IT expenditures, ask yourself whether that investment will noticeably improve your product or service.

For example, Karen Miller, director of IT for FedEx.com development, says everything her department does stems from the primary mission of making the FedEx website more user-friendly. “Our main objective is to enable customers to do business with us on their terms,” she says.

So it comes as no surprise that Computerworld magazine recently named FedEx a “Best Place to Work in IT” for the ninth time in 10 years. Of course, a Fortune 500 company has more resources than smaller businesses to invest in IT systems.

However, much of what FedEx does to keep its IT team in the know is possible on a smaller scale, beginning with education. A variety of online and classroom training options are available to all FedEx employees. And the company’s IT managers meet individually with their employees to create customized development plans. Every company, no matter its size, should be able to accomplish the same thing on some level.

Here are a few more strategies to keep your IT capabilities current and competitive while remaining within a constrained budget:

• Invest only when there’s a proven return. Don’t feel pressured to keep up with or stay ahead of your competitors if there’s no ROI in sight. In their best-selling book “Rework,” Jason Fried and David Heinemeier Hansson, founders of the software company 37signals, state it eloquently: “Cold War mentality is a dead end. Solve the simple problems and leave the hairy, difficult, nasty problems to the competition.”

• Ask about extended support. When outsourcing, it’s a good idea to specify a warranty or support clause so you’re assured of continuing support from the vendor. It’s much easier to negotiate a support clause before the service provider begins work.

• Make a list. What hardware and software has already been purchased for your business? Where and how is it being used? Make sure that people in one department aren’t duplicating purchases in another.

• Start small. Begin with a project that is relatively small and simple in scope. If possible, implement your IT infrastructure in phases.

• Align purchases with goals. And obviously, all investments, including software, hardware and staff time, should support a specific business goal.

Paul Nolan is editor of SalesForceXP magazine, a bimonthly publication that provides sales managers with insights for getting “Xtra Performance” from their sales teams. 

American Express OPEN and FedEx have teamed up to provide discounts and a comprehensive resource for shipping, business and print services. To learn more, go to http://www.fedex.com/opensavings.

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