Small Business Information Technology

The Information Technology (IT) bubble is anchored on large business. Small business, on the other hand, is anchored on a local technology and peripheral store. When large business needs software there are two options: build or buy. When small business needs software its the strip-mall. In other words, there is Microsoft Office, Quark, Adobe, Quicken, etc. So in a sense, its all about large business and expensive software crafted for large business. What then, are the other options?

These days of online bookstores and metal shops obviously intimate the diverse creativity of people in unexpected business domains producing or consuming software services on the Internet. Using the Internet can entail a web store, or it can entail remote use of a database, documents, graphics, or perhaps other software over the Internet. Some examples of the ways small businesses use software include tracking software - sometimes a spreadsheet, graphic arts, document archives, accounting, publishing.

Effectively, small business is categorized by the industry as a private consumer. There is often no or small advantage between being a small organization versus being an individual. Small business generally doesn't get very far down the pricing sheet. However, unlike private consumers, software that small businesses use often requires specialization and could cost tens of thousands of dollars in licensing with significant annual maintenance and update fees. Even the simple case of spreadsheets requires someone to purchase a manual and dig in. Its time and effort that is paid either in sweat or cash.

Generally project budgets are summations of direct costs for software but don't include indirect costs of software maintenance over time. The omission is common for large business, small business, and all shades of gray. Indirect costs come from maintenance updates of supporting software, the task of installation, and solving user issues. In other words, the maintenance and administration of software is often time consuming beyond expectation. Then there are unexpected costs. Every small business owner knows about unexpected costs.

Unless there is a mortal requirement small businesses usually pass on the cost of specialized software in favor of more practical solutions - Microsoft Office often comes with a computer purchase and budget friendly utility software for example. It is a favorite contingency that often becomes the de-facto standard because it is approachable and familiar. There are templates for many types of spreadsheets shipped with MS Office, iWork for Mac, and some ship with Open Office 2.x (Open Source for most platforms including Linux). The trade-off is the time and effort to create specialized spreadsheets, further specialization of existing templates, maintaining data integrity and data input, provide data access and developing reports; common daily tasks. Translucent future tasks will involve both capacity and capability.

There's a fascinating category of small business that does not fit well into the preceding generalization. The environment changes when business stakeholders have IT experience. The economy model is different because savvy stakeholders can add sweat equity in creative ways. Clearly having IT experience is an advantage but doesn't come without risk and cost. The fulcrum is the team's breadth of experience relative to the technical landscape - in other words, whatever the team has to work with is the team's foundation. The risk is limited breadth, vision, and experiences that can lead to simple oversights and incomplete estimates. People in this circumstance become The IT Department, no matter the first intentions. A presumed part-time concern that becomes a full-time task. Ces't la vie? The problem compounds if too much attention is subsumed for tech problems versus running the business. The tech problems become the focus and business operation becomes an annoyance. Its easy to get wrapped up in technology and loose perspective of the business. Too easy - some tech problems are made of dark chocolate and are magnetic. This is demonstrable by the obvious difficulty of finding a chocolate Easter Bunny having both ears within three feet of a unrestrained child of four years. -- QED.

The most challenging group of small businesses are small private medical practices including veterinarians, dentists; in fact, all health care practices. The software for dental offices is expensive and complicated. Imaging software is coming into the private practice as the industry is shifting to digital images versus film. There are very few options in this case. For those in this situation, you may be interested in becoming a supporter of Open Source. There are several projects supported by the US Department of Health. A Google Search will find Medical Open Source and AAFP information on Open Source Medical projects. Support and community interest in these ideas is one way to influence this up-and-coming option.

This makes it sound like IT for small business is high-risk or sketchy and some people may want to avoid a dependence on specialized IT altogether. Its hard to avoid and in many cases its high-risk for a small business not to use IT. The risk level is in part related to how business critical the software system is. Perhaps business processes are dependent on IT and the risk must be assumed - there's was no choice. If the software is critical there is a propensity to accept higher risk.

If this risk can be mitigated for all these situations, there would be fewer false starts and fewer bad endings. The problem itself suggests a hypothetical which is if small businesses had access to someone with direct experience building commercial information systems, then the team's breadth of knowledge is enhanced significantly. Why experience in information systems instead of information technology? Because information systems as a focus, doesn't assume specific information technology. Information systems are processes that specify the flow of information through an organization and can be described without implicating computer technology but is most often implemented with information technology. In a manner of speaking, this is the same thing as understanding environment and surface options before choosing paint and tools.

How does this provide a solution? First, its practical knowledge, it takes advantage of greater breadth and depth of experience, and reduces the risk of re-validating historical mistakes. Metaphorically, you would be traveling with someone who has been down the road quite a few times and has seen the caveats.

How can small business afford this resource? Obviously this is a senior information system person that is also a technician. Large corporations title this person as the Chief Technical Officer, Chief Information Officer, or Chief IT Architect. This is someone who has built information systems, several times, and has a broad swath of IT experience. The role is not required full time, just when needed and as needed. It becomes an affordable proposition when the rates are pragmatic - meaning everybody wins. The initial question is then incorrect. In other words, How can small business afford this resource?, overlooks a more practical question. Economics suggest that the question begging to be asked is What is a reasonable rate that small business can afford? The first question is skeptical of the existence of solutions. The second question assumes solutions exist based on a fundamental notion in Economics that if there is no interference, the market will balance on a reasonable cost for reasonable expectations.

An answer to the question requires a straw-man business model. The model must constrain the search for individuals who are local; limits travel and commute expenses. Because the individual is local, rather than base rates on existing rates of consultancies, base rates on cost of business plus reasonable margin. Also, because the role is not full-time, there can be no expectation of matching corporate salary scales for IT Professionals. People near or transitioning to retirement make good counselors, they have the requisite experience and are often in the process of simplifying their life style. Depending on these variables, its conceivable the rate could be very practical and affordable.

The independent CTO provides counsel under an hourly rate. The benefits are similar for most small business situations. For example, (a) a business seeing a transition beyond spreadsheets can explore solution options; (b) a business with IT experience can brainstorm strategies for increasing scale and/or reduce maintenance efforts and costs; (c) and under a or b or any shade of gray, knowledge share and solution research for IT challenges and future proofing - preparing for the future.

Assuming a hourly rate for an independent CTO can be reasonable, a small business can afford benefits of insight and planning as do large corporations. The same solutions used by large corporations can contribute to small businesses with some independent and forward thinking. It is most often the case that having seasoned counsel about information management and information technology can springboard solutions, define options, avoid pitfalls, and inhibit indirect costs. Absent residual beliefs and assumptions about corporate rate sheets, this model could work.

So, what does that mean?

What does the phrase 'pragmatic information systems' mean? Why make a title of it? Why not Pragmatic Information Technology? Because in the tenure of my career in distributed technology I've come across what I think is an important distinction - Information Technology is still a single-sided phenomena, one only needs to follow the money. Said another way:

• The consumption and use of information technology is primarily a game for well funded organizations


• The focus of software companies drawn to well funded organizations.
  

The phenomena produced by the Open Source philosophy was supposed to close that gap. What happened is ironic. Once the licensing landscape was established, read that: clear boundaries of liability; Open Source became a competitor to established software vendors. This was especially so in the middleware space where application servers compete. An application servers is a platform that consolidates technologies used to produce sophisticated web applications. Well funded organizations were able to play the reduced ownership cost of tested, and in some cases certified, Open Source distributions against the usual and established suspects. The establishment's licensing costs are surprising; from what I've experienced and have had validated by my peers, the quality of support is sometimes not that good until you get to the right people.

Now comes software companies and consultancies focused on Open Source (OS). As a consultancy the organization offers experts in a strategic range of OS distributions. Open Source software companies tend to lie between two extremes:

• Consumers of OS projects who test and certify distributions, provide email and telephone support, maybe organized field level support and learning services
  


• Administrators and benefactors of OS projects, repackaging of public domain into a supported branded product, provide email and telephone support viz licensing, maybe field support and learning services
  

The reduction of cost of Open Source is associated with the reduction of complexity; i.e., the cost of development is absent or significantly reduced. But to be fair, the same is true of the quality of support in Open Source support organizations, and sometimes successful support from the community is complicated.

The effort of obtaining support from the Open Source Community is caused by a misunderstanding of the nature of the Community. Rule #1: Simply because you are using the distribution (whichever that might be), does not entitle you to a response, a solution, or even the attention of the developers. Rule #2: Read the manual, and read it again, and refer to #1. This is a different environment from the traditional. It may sound odd expressed this way but, the Open Source Community is best suited for independent sorts who can contribute to the knowledge base. The use of Open Source and participation in the community is a cultural change from the customary business model. Open Source is a community based model of software development versus a unitary source based model. The community model does not allow entitlement, it allows only participation. The unitary source model allows entitlement by definition.

Many of the Open Source software companies and the consultancies that support Open Source have associated costs that are not conducive to the economics nor the operandi of small business. Some benefits of using software associated with Open Source exist, for example Ubuntu, to be fair, but these benefits tend to be little more than what comes in the shrink-wrap; for example thirty-days free access to supported archives, or automatic updates until product end-of-life. How does that benefit small business beyond what a high-school geek benefits?

The preceding are the observations that compel this summary of what I mean by Pragmatic Information Systems. The promise of IT was better, faster, cheaper. Frankly, that promise is empty of meaning in the context of the current culture. Perhaps its become better-faster-cheaper for those with budgets to afford better-faster-cheaper; but I'm not familiar with any. The focus has been too shallow. Better-faster-cheaper is a war of words only.

Small businesses often have a need for better-faster-cheaper technology to compete better, faster, and cheaper. The lesson from the myth of better-faster-cheaper compels reiteration on the way information can be consumed and used by a community of interest. But an information system is a significant expense made more significant by the sophisticated methods and technologies owned by larger organizations. A collateral effect, in my opinion, is the impractical prioritization of presentation; the pragmatic implication is a deflection of focus from the first priority of conveying information. The information can be void as long as it looks good in lipstick. The gap between information producers and information consumers widens continuously in the current culture.

The present state of affairs makes it sometimes cost ineffective to invest in stricter governance of costs, both direct and indirect, because a technology could not be purchased. The resulting situation is brutal pragmatics: The existence of the problem is far less annoying than the solution. There are several, probably countably infinite, cases and examples. Its true that in many cases large concerns have opened information sinks accessed via a web site and special credentials. Some are sophisticated, some are restrictive. However, many times the terms and conditions of access to critical information is restrictive and risky to small businesses. This is an impractical model when nearly all businesses, large to small, are so tightly coupled to an international network. Its the same Internet for everyone and Open Source was intended for community use - meaning the World Community. Open Source does not imply free nor does it imply entitlement. The price tag involved can be paid either in capital equity or sweat equity. The olde-fashioned way is still the gauge. That means money or time in some moderation. Its been my impression those two things are, in a manner of speaking, commodities that are in short supply to a small business owner and operator.

This only adds impetus to the focus that small businesses can use the same technologies as the large concerns - its a matter of inventing pragmatic ways of adopting Open Source. What's good for the goose can be good for the gosling. This Blog is about how Open Source can be used beneficially by small businesses without a dependence on what large businesses can budget for Information Technology development. The solutions to be explored have two sources: my head, and community feed back. This in itself should be a friendly nudge that to find solutions entailing Open Source for small business the pragmatics shifts the emphasis to community.