Top 3 Small Business Challenges in IT

The Morning Drive Podcast Episode 8 transcribed by our app TranscribeMeow. Check it out in the iOS App Store. Welcome to the Morning Drive podcast. I’m your host Rey Ortega, the CEO, and founder of

Welcome to the Morning Drive podcast. I’m your host Rey Ortega, the CEO, and founder of Grata Software where we partner with businesses to build innovative technologies on cloud platforms. Today I have the top three things that I found that small businesses run into when they’re trying to build technology or they’re trying to understand how to incorporate technology into their business. Technology is a very expensive venture. Some of us who’ve been doing this for many years know that technology can be very, very expensive. Sometimes projects could go anywhere from fifty thousand dollars on the low side and sometimes end up at three hundred to four hundred thousand dollars depending on the level of complexity of the project.

When we work with small businesses, they could fall anywhere between small startup businesses all the way up to thirty to forty million dollar businesses. The SBA, Small Business Association, have determined that in certain industries, small businesses can go up to those numbers. In IT, it goes up to seventy million if you’re a small business, so being a small business is very relative to the industry that you’re in. With the work that we do, the clients we talk to and even people who are not our clients, we’ve run into several issues when we work with small businesses. I want to bring up the top three things that we run into that are very important for you to understand. And maybe we can figure out a way to help you understand how to get past these issues.

Strategic Planning

The first thing is probably one of the root causes for small businesses. It’s not technology, but the lack of strategic planning for IT. We’ve dealt with several companies where we’ve gone in and they could use some sort of technology, whether its Microsoft Word or some type of Microsoft based ERP system. What we find is that they incorporate things like Microsoft Word and Excel or they may incorporate some type of accounting software like Quickbooks. The problem with when you work with software that you purchased for your business, it’s built for a specific purpose, and it’s more of a generalized purpose, it’s not specific to your business.

Now, Word and Excel are not a perfect example. Neither is QuickBooks because it’s the standard for accounting. However, assume I’m a property management company looking to buy property management software. Well, the property management software that I buy has been built more specific to an organization that needed that kind of software. Or they’ve talked or met with several people in that industry and got an idea of what to build for that industry. So you’re kind of working with technology that’s been built for a specific purpose for a specific client.

We find this many times when we get involved in these government bids or even other large corporate bids, their proposal or their request for proposal tends to have verbiage in there that’s very close to a company that already has a software that’s pre-built for them. So in those cases, sometimes it’s really difficult to even do anything about, but if you personally are running a small business, you’re going to run into this situation where you’re going be looking at some certain types of technology that you’re going to purchase for your business.

Now, the thing is, when you’re not really planning it out, and you’re kind of just buying what you need when you need it, you run into this issue where once you buy, you may spend thousands of dollars on the stuff that you buy and then realize that it doesn’t do all the things that you need it to do for your business. It’s not tailored to what you do, and that becomes a problem. And that’s something that you’re going to have to contend with when you get to that point.

We once met with an engine manufacturer years ago that had purchased five or six different applications in order to be able to perform all of their manufacturing tasks and all of their processes. After meeting with them for a couple days and assessing all of the things that they do, we found that all of these different applications each function in a specific area of their business, but together they don’t collectively work together. And there wasn’t really an integration piece for either of them. So we had to architect a full custom solution that would allow them to be able to go from phone call to delivery and through the whole manufacturing process with an application that we would build that would function for their business from top to bottom.

That tends to be the avenue to take, especially if there’s something that you’re really trying to go down that path of getting something that you really need. With third-party software, you don’t really have those options. And that’s one of the things that we’ve seen working with small businesses, that there’s no real strategic plan for IT. It’s kind of ‘I buy it when I need it and I kind of incorporated as I need it.’ So it’s one of those things that we definitely would recommend.

When you first start a business, look at certain things from an IT perspective. It’s really important to have someone that you could go to, some type of resource that will provide you that kind of information. It’s really difficult with all the technologies that are out there to kind of come up with your own way. But that’s why companies like us exist and companies, like other competitors of ours, exist. Our job’s to kind of guide you through that process and find you the right technology for what you need for your business.

So that’s one of the first things that we’ve noticed working with companies is that without an IT strategic plan, they tend to be lost at first and purchase a lot of software that they don’t really need. It doesn’t do all the things that they need it to do, they end up spending all that money, and then they have to go back and finally come to someone like us. Now they’re spending hundreds of thousands of dollars on a solution that’s very custom. Some of them were able to afford it. Some can’t. But at least before you get started, it would be great to have a strategic plan of how you’re going to use IT to your benefit. And I think that’s really important to start off with.

System Integration

The second thing is when a company decides that they are going incorporate some type of technology like an ERP, or enterprise resource planning software, and they want incorporate and integrate with other systems. For instance, Quickbooks can integrate with certain ERPs. The issue that happens is that they may incorporate technology, but the problem is there isn’t a disaster recovery plan for that technology. I’ve seen several times where companies build technology and then it goes down and they’re calling around ‘what do I do to fix this?’ A lot of companies that we get tend to be companies that have already gone out and actually invested in technology, but now have a problem with the actual recovery and scaleability and the types of planning for growth with that product or technology and that tends to be another problem that they run into.

It’s important to have a plan for that and it goes back to your IT strategic plan. If you’re going to build a IT strategic plan, also build some type of disaster recovery plans in case a server goes down or your application goes down, there’s a way to recover it. We had a client who was potentially going to lose their whole business due to a hurricane, so it’s important to have a plan of action. They did not have a plan of action. We incorporated one after we got on board with them. Fortunately for them, it did not happen. But if Hurricane came by and flooded their office complex, they would have had nowhere to recover their product or any of their technology. So come up with a disaster recovery plan if you are investing in technology for your business.

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Security

The third most important is security and this is a very touchy top topic. Even right now, there’s a whole bunch of conversations about cyber security, intrusionware, and ransomware. We’ve seen ransomware in action when one of our clients came to us and asked us to fix one of their API’s. Immediately when we tried to log in to the API, it was covered and ransomware. So it happens. Security is one of the biggest risks when it comes to any type of technology, even comes to your own internal stuff. We’re not even talking about product development at this point. We’re talking about this technology in general. If you’re using Microsoft Word and Outlooks server in your local environment or even if you’re using a cloud based environment; security is the number one priority.

Right now there’s a lot of regulations that protect user security and user data. For instance, a GDPR, which is the European New Data Protection Act, is a four percent of total revenue. It doesn’t matter for which division. It’s total revenue for the whole corporation if you violate the GDPR standards.

So security again is the number one issue that we find in most businesses. When we talk to them, they don’t have a clear security strategy to protect user data and it’s really not their fault. Not everybody who starts a small business is going to know that right now they’re probably being hit about one hundred times a minute from some hacker in Ukraine or Korea or China. They’re not going to know that and it’s hard to know that. You would have to be a server administrator to understand that. A lot of WordPress sites right now get hit so many times with so many types of malware that get installed and it’s shutting down sites and shutting down companies that are using WordPress as their primary source of application management, which is common.

Not every company builds custom software from scratch. Some of them, especially some smaller businesses, use WordPress for a lot of their small business needs. We as a company don’t recommend that, especially when it comes to an application. If you’re building a website that’s basically for marketing, WordPress is a very valid source. But when it comes to enterprise applications, we don’t recommend WordPress.

We do have clients who are using WordPress for enterprise applications, and we find that they spend so much money with us just in managing the WordPress sites. It takes a lot. They’re being hacked every day. There’s constant bots that air hitting those WordPress sites and our job is to make sure that they don’t. And if they do, they’re not getting anything out of it. But it still taxes your server because you need to write scripts in order to basically not allow connections from different IP addresses. So there’s a lot of work that goes into that and that costs money.

And as a small business, you can’t keep spending that kind of money on just preventing someone from accessing your website. You could if you’re like a thirty to forty million dollar business. But if you’re a small business, you really can’t. It’s really not feasible for your business to do that.

Conclusion

So those are the three things that we see when we work with companies. There are some companies that we talk to that are not even our customers and we provide advice anyways because we care. We want to make sure that their business stays around. We’d love for them to come back, call us and say, ‘Hey, we need you guys now.’ And so we try to provide that information to them about hacks and also make sure they have an IT strategy because these are very important.

We have a customer who we’ve build technology for and they had an IT strategy that they were implementing. We built a system for their company to use and now that system has turned into a product that they’re turning around and white labeling of selling to other competitors. It’s a valid way of making additional revenue. Not only that, but it’s also minimizing their costs and internal operations. When we work with companies like small businesses, these are the kind of things we still run into. The best way to handle them is to work with an IT or software consultant like Grata Software so that we can help you mitigate these risks and issues and help get you the technology that you need in order to make your business more successful.

And so that’s why it’s really important to speak with a professional who understands how technology is used in all different facets of the business. So if you feel like you’re running into problems like this, then definitely contact us. If you have any questions, we can help you move forward. Catch you on the next podcast.

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Rey Ortega
Rey Ortega

I'm a passionate creator of technologies for businesses. After years of leading software teams & delivering products to market, I founded Grata Software, a software consultancy, that helps businesses innovate and build disruptive products on cloud platforms. At Grata, I am the CEO & Head Solutions Architect.