In This Chapter

Regardless of the type of business you’re in, an information technology (IT) plan is critical to the survival of your business.

Whether you are storing or using customer data, processing invoices, tracking accounts payable and receivable, writing proposals, communicating with customers, or keeping up with the latest news in your industry, you will need to use IT. Choosing the appropriate technology for all of these processes is both a big strategic choice and, potentially, a major investment. And no matter how small your business is, you need, and always will need, some kind of IT infrastructure. That infrastructure will certainly change over time, but that fact should not prevent you from taking action to create a plan that meets your business needs today.

This chapter helps get you started in a key best practice for IT: the ongoing task of setting up and revising the right IT plan—one that serves both you and your customers. If ever there was a best practice that deserves an investment of continued attention over time, this is it.

What kind of hardware do you need for your business? Different businesses have different requirements.

Some businesses, such as single-location retail outlets, may require a relatively simple setup: a laptop, a point of sale (POS) terminal bundled with an inventory system, a telephone/fax machine, and the service necessary for that phone line.

If you are running a sales organization with multiple salespeople, you will need to plan for a different level of investment. Such a business could require a customer relationship management (CRM) system, an enterprise resource planning (ERP) system, and all the necessary hardware to support those systems. An ERP system is an integrated software application that serves as a business management tool, helping to track resources, tangible assets, materials, finances, suppliers, vendors, customers, and employees. A CRM system is a software program that enables businesses to track and manage their interactions with their current and prospective customers. It is used by both sales and marketing departments to ensure a coordinated interaction with customers.

You might also require an integrated phone system, such as Voice over Internet Protocol (VoIP), with a more complex setup than just a single phone line. You could also choose to host a number of servers to support all of these applications, therefore requiring a more business-friendly Internet connection, complete with a firewall to protect all your data.

When it comes to hardware, you can choose between various operating platforms such as Microsoft, Linux, or Apple Macintosh. As of the writing of this book, most businesses use Microsoft-based computers because they are still perceived as being less costly overall, and as offering businesses many more options. Choose hardware that you are most comfortable with and that best meets your needs, including supporting the software necessary for you to run your business.

If you travel frequently, you may opt for laptop computers rather than desktop computers. Similarly, if you have sales folks on staff, they will need laptops since they are likely to be on the road much of the time at customer sites.

The software you need to run your business—word processing, spreadsheets, database, and accounting software—may dictate the hardware and the platform you need. You also need to take into account the need for compatibility with current or projected partners, vendors, or suppliers. To whom will you have to transfer files? With whom will you work to track inventory?

Choose telecommunications equipment (phone system) and services based on your current and projected business needs. If you require an overall networked environment because you have many employees, it is probably more cost-effective to go with a single vendor for telecommunications and Internet services. Alternatively, if it’s just you, and maybe one other person, in the business, a simpler phone system may be sufficient. In this situation, a non-business-oriented telecom provider may be the most cost-effective choice.

Your goal should be a flexible, affordable system that allows you to be prepared for growth without going overboard on costs.

We’ve mentioned more than once that when choosing IT, you need to think about both your current needs as well as your projected future needs. To do this, you need to ask yourself a number of questions.

First, answer these questions to get a good sense of your current needs:

Then think about the future of your business:

The good news is that when planning for IT needs, you only need to look a few years into the future. There is no need to focus on where you may be in five or more years because technology changes so frequently that you can’t plan effectively that far out. Focusing on the next two to three years is a good bet to get the most out of your investment.

Consider the following when deciding whether to lease or purchase technology for your business:

You’ll also need to consider whether to purchase maintenance agreements on the technology you lease or buy. If you decide to lease, frequently (although not always—check the lease agreement) maintenance is part of the agreement. Additionally, sometimes you can negotiate for upgrades to equipment you lease. If you decide to purchase your technology, you might want to purchase maintenance and service agreements to protect the equipment.

Depending on your business, software needs will vary. If you are an insurance firm, for example, you’ll need word processing, spreadsheets, presentation, and maybe database software for everyday needs. If you are a manufacturer, you may also need inventory control software and ERP software.

You’ll purchase software on a per license basis; this means that if you have three people who will be using word processing software, you’ll need a three-user license.

The largest provider of office-related software products (such as spreadsheets and word processing programs) is Microsoft Corporation. A variety of companies have ERP software or accounting software, and your decision on a provider for such software will be based on many factors, including:

Just as with hardware, you will want to choose software that will grow with your business, keeping in mind that you will need to purchase upgrades to the software regularly. When selecting accounting software, make sure you can easily share information with your accountant.

Many small businesses dispense with purchasing software altogether and instead opt to run much of their IT through the cloud. With cloud computing, the software and data is accessed via the Internet rather than stored on your computers. Instead of purchasing software and hardware for storing data, you simply pay for the capacity you need. Companies such as Microsoft, Google, and Amazon provide cloud computing services.

With cloud computing, rather than investing in IT infrastructure and software, you simply purchase capacity as you need it. With cloud computing technology, you and your employees can access your software applications and data from anywhere as long as you have an Internet connection.

Security and privacy are increasingly important concerns for businesses considering using a cloud computing environment. There are ways to protect your data, of course, but you should consider how much control you want over where your data resides and your access to it prior to choosing a cloud computing environment.

Too often, businesses continue to use cloud computing environments long after it no longer makes financial sense for them to do so.

If you choose to use cloud computing, you want to be certain that the data you store in the cloud remains yours—you own it, not the host company. Ensure that, when you terminate the agreement, you get all of the data that you stored in the cloud. There should also be a provision for purging your data from the cloud once the agreement is terminated and all your data is back in your possession. The agreement should also provide for a service level agreement (SLA), which basically states that there is a quick turnaround for support and that you will have access to your data within a certain amount of time if the system should crash. Additionally, look for guarantees for access to data and speed of access.

You’ll also want to make sure you back up and export your data on a regular basis. You want to keep your data outside the cloud in addition to in the cloud.

Of key consideration in determining your technology needs is keeping your data safe. You’ll want to protect your customer data, information about your employees, and your business finances.

A firewall—hardware and software that blocks outsiders from accessing your data—provides a secure environment for your data while permitting those with authorization, such as your employees, access to information they need to do their jobs. If you decide to use a cloud computing environment, or host servers via a third-party collocation site, be sure that you get details on how data is kept secure. If you are uncomfortable with any aspect of the arrangement, don’t take a chance. Losing sensitive customer data because of improper precautions or carelessness can drag you into lawsuits that can be detrimental to your business reputation and very costly.

Depending on the requirements of uptime for your system and the data, you may want to have a failover environment in place. This basically duplicates your systems, so if one system fails, the other picks up and takes over, allowing for uninterrupted operations.

Certainly you’ll want to consider backup systems and software to provide you a regular backup of the data on your system. With a backup system in place, should something happen—such as a user deleting information by mistake or a system crash causing a loss of data—information can be retrieved from a backup. Consider Symantec Backup Exec for Windows or Macintosh environments (www.symantec.com). Smaller businesses might opt for Goodsync (www.goodsync.com).

If you retain customer information such as credit card numbers or other sensitive data, it is imperative that you keep that information safe.

If you store any credit card information, go through a PCI-compliance audit to ensure you are following all protocols for storing the credit cards. Ensuring PCI compliance can be costly and might require you to hire a consultant, but it is worth the money, time, and effort to ensure that you have protected the data you store on your systems. See www.pcisecuritystandards.org to find out the latest version of standards and to get more information about PCI compliance.

Just as you need a plan for getting your business back up and running after a major incident, you need a disaster recovery plan for your IT. After all, any significant period of downtime can be very costly to the business. You’ll need to have a plan in place should any of the following occur:

When developing a disaster recovery plan for your IT infrastructure, perform an analysis of your exposure to risk. What would an event such as a fire, flood, or hurricane do to your data? What would happen to your business if you suddenly lost all your data as the result of such an event? What systems are in place to keep that from happening? Include in the risk analysis how secure your systems are—your firewalls, authentication requirements, backup systems, and so on. The less secure the systems, the more likely you are to lose essential data.

Here’s another question to consider: how much time can you afford to have your systems down and unavailable? If you must be up and running around the clock with no exceptions, you might want to consider having a collocation site with a complete duplication of all of your systems running. If your business is located in Massachusetts and you cannot risk being down, you’ll want to consider having backup systems in Maine or Connecticut pick up the slack should your systems in Massachusetts crash. This is, of course, a costly endeavor and is only recommended for companies (such as financial planning businesses) that have very sensitive information that cannot be lost or down for extended periods of time.

Once you develop your plan and have your backups in place, test it. You don’t want to wait to find out if the system works when you really need it. As a best practice, run an audit of your disaster recovery plan on an annual basis to determine if it still meets your needs.

The IT industry issues security updates on a regular basis to protect its software from hackers, viruses, and malware. You’ll want to have a system in place to regularly install these security upgrades.

Unless you are an expert in this area, you should strongly consider getting some kind of (affordable) expert advice in making the best IT choices for your business. You’ll want to select a consultant who …

Spend time with the consultant before you hire him to ensure you are comfortable with that individual’s working style. You should feel comfortable asking questions and being honest about your needs and your budgetary restrictions.

Several websites provide consultant directories segmented by industry. For example, Consultants Registrar (www.consultantsregistrar.com) provides a listing of consultants by industry and by state. Another option is Consultancy Register (www.consultancyregister.com) which enables you to search for consultants in a variety of specialties. But perhaps the best way to find an IT consultant is through references of others in your industry who hired a consultant and had a positive experience.

You don’t want to invest significant monies now in an infrastructure plan and find out next year that your technology choices no longer support your business effectively. You must plan for growth.

If you are unsure of your needs, consider starting out with software-as-a-service (SaaS) applications. This reduces your out-of-pocket expense for costly technology solutions. As your business grows and you have a clearer idea of your needs, you can begin to make the investment in your own technology solutions.

Develop an IT plan based on your technology budget and your current and future technology needs. Update the plan on an annual basis to reflect changes in your business.

Take these steps in developing your IT plan:

Include the following additional information as part of your IT plan:

As a best practice, maintain a binder with all of this information; doing so makes it much easier to evaluate your IT needs on a regular basis.

Technology changes constantly. There is always a new tool on the market with more bells and whistles. You can’t possibly invest in every piece of new technology, nor should you attempt to do so, but some may provide great benefit to your business.

Let’s assume that you are ready to upgrade your IT systems. Before committing to a certain plan, take a day or so to review all of your options. What new technology exists that would add value to your business? What technologies will be available in a year or two? Is the technology maturing quickly enough for you to take advantage of it given your limited resources?

Keep in mind that because technology changes so rapidly, you will always have appealing new options to choose from. Make the best choices you can right now. Don’t let the blizzard of available options paralyze you. Make a decision. Create the best plan you possibly can, double-check it, then implement it. Then review your IT plan annually.