Today we are going to be talking about the compounding effect of IT. What does it do? How can it help businesses and be more successful?
Todd Nielsen: Welcome to the JMARK Business Innovation Technology Experience. Today This is Todd Nielsen. I have with me here Thomas Douglas, Kristina Coon, and Dax Bamborough. Today we are going to be talking about one of my favorite topics which is the compounding effect of IT. What does it do? How can it help businesses? How can it make individuals be more successful? How can it make businesses be more successful? Who wants to go?
Dax Bamborough: So I guess I’ll just start by making sure … So maybe describe a little bit better, Todd, what do you mean, use the word compounding effect? What? Explain that a little.
Todd Nielsen: Yeah. So I think with anything in life, when you have something that you’re investing into and it’s a good investment, there’s a compounding effect. It’s not just something that incrementally increases. It’s something that multiplies many fold. If you think about a financial investment and the same is true in a sense with IT because IT is considered, well, unfortunately, a lot of people consider IT an expense but it’s really an investment. You’re taking money and you’re putting it towards something and you’re you’re hoping for an outcome.
Todd Nielsen: That outcome isn’t necessarily financially-oriented, the outcome might be productivity or it might be security, reduce liability, but it really can be money, profitability in the business. So the compounding effect of IT is essentially, how is IT the investment that potentially compounds many, many times over into a successful organization?
Dax Bamborough: I think as you mentioned, the different areas maybe that people look at, productivity or security and stuff. I think to add to your point, those things build on each other as well, the more productive you are, we know that that leads to more profitability. The more efficient you are, that leads to more profitability. The more secure you are, the less likely you are to lose time to downtime when you have trouble, when you’ve got your plans in place for disaster recovery or those things, that’s where that has an effect that’s not not necessarily tied directly into that particular thing. But it affects your business in other areas. That’s the compounding effect that you’re talking about.
Thomas Douglas: Yeah, exactly. If you break it down and you think of it simply in a couple of different ways. One might be a billable resource within an organization. So an attorney who generates their revenue, generates the dollars that they can take home by the hour. If IT is down for them, obviously they can’t produce, they can’t get things done. So their potential income has just taken a hit inside their own world because of IT.
Thomas Douglas: If you talk about the compounding effect of that, look at a sales and marketing team. So if you have a sales and marketing team who are responsible for bringing revenue into an organization and they’re down for a period of time, let’s say that they’re down for three to five days, well, that three to five days can have a compounding effect that leads to cash flow problems or a missed deal or not getting a contract or a deadline met.
Thomas Douglas: So the compounding effect of missing those things inside of an organization may not just be the productivity head of it, it can actually have a massive financial ramification on an organization. If you miss one income stream, that can turn into not having the funds to invest into sales and marketing or not being able to invest in the right things that you need to to continue to grow the business. So there’s a there’s a massive compounding impact that can happen. It’s a little bit like that compound annual growth rate. So if you look at it through the lens of you earn interest in a savings account, and then the money that was deposited from that interest then has the potential to earn further interest. IT can have that same kind of a compounding effect in a business.
Todd Nielsen: It can also be life saving or life-threatening. I mean, if you’re a medical facility and your IT isn’t working, and you can’t check in patients or you can’t view charts or x rays or reports that are all on the system, it could potentially be quite scary.
Thomas Douglas: It will in the long term health facility, most of the medications are now distributed through technology. They’re managed that way because a lot of the medications are protected and they have to be maintained in a secure environment. They can only be distributed at certain increments. In other words, you can’t take a narcotic of some kind and give it out three times in an hour when you’re only supposed to give it out once every three days, or once every other day, or once once a day.
Thomas Douglas: But at the same impact, if you if the technology goes down and in the systems that control that can’t be accessed, then it can mean that the life saving medications or necessary medications may not be able to be distributed to someone. Because of that, they can create major challenges. Major risks and yes, it could be life and death.
Todd Nielsen: Yeah, the other thing with the compounding effects that I think a lot of people look at the base level of to have fast productivity and to have things that are reliable and stable, I just need to spend money on the equipment. I got to have blinking lights, and the right hard drives, and the right memory. That’s going to solve my problems. But unfortunately, that’s just the kind of the base of sorts. With what I’ve seen on the compounding side is, I mean, my performance can increase, the number of projects we do can increase, the initiatives can increase, the metrics can improve, the collaboration improves. I mean, it just slowly builds each of these little thing. It’s like the little superpower that starts getting faster and faster and you’re getting your power and then you don’t take care of it, it all comes tumbling down.
Thomas Douglas: But it’s the minimum right to play anymore to have have a decent, reliable computer. I mean, businesses know. I mean, it’s like well, a car’s got to have four tires. It’s got to get down the road, it’s got to start. I mean, it’s very similar with a computer, there’s a certain base set of expectations that come with technology. But on the flip side of that is do you have the latest safety in place, i.e. Do you have the seat belts in the airbags? Do you have the technology, the security put in place on your network?
Thomas Douglas: Because it’s not a matter of if, it’s a matter of when, you’re going to have some sort of a security threat that hits your network. It’s the same that you do, you wouldn’t take your two-year-old son or daughter out and just put them in the backseat without without a car seat, without safety and putting them locking them in, and making sure that you’ve got the right airbags for your spouse. None of that is going to happen.
Thomas Douglas: The same is true with technology. If you don’t put the right safety mechanisms in place, there will be some sort of an incident an accident, if you will. If you haven’t prepared for that your world is going to come crashing down and productivity is going to die. It’s on both the positive with the mean to speed things up. But it’s also on the negative too of what happens when you don’t take those precautions and you come to a crashing halt.
Todd Nielsen: The other day, my four-year-old was trying to convince me in the car to let her drive, and so that that comes home there. But it’s like you said, I mean, a lot of a lot of companies, essentially are putting a four-year-old in charge of their IT services. Now from a maturity standpoint, it’s a complex world out there.
Thomas Douglas: It is.
Kristina Coons: I will say too, a lot of times I think that the employees feel it as well. Just going to trade shows, I meet a lot of people in all different roles. We’ve heard people say, “I have literally left a job because the technology was crap, and I can’t work.” Tom says this all the time, “People want to do a good job.”
Dax Bamborough: to add to that, I think IN my own experience, working for JMARK, I work remotely, I work in Utah. Last year, my computer crashed one day just out of the blue. And you know, one minute I’m working. Next minute, my computer is entirely dead. I thought about this when Todd mentioned just investing in the hardware. But it goes beyond that because JMARK also had the process in place to get me, a remote worker, working again as quickly as possible.
Dax Bamborough: I think people would make the joke, “Oh, that’d be nice. If my computer broke, I’m just going to take the afternoon off, nothing to do, right?” But that’s never the case. Because really deep down inside, my work didn’t go away. Nobody else was getting the work done. It still needed to get done. That had an effect on my teammates who needed me to get something done in order for them to get something done. That was stressful for me.
Dax Bamborough: But the entire process was within place that I called it in. The next day somebody showed up from HP to try to switch out the hard drive. That didn’t work. JMARK already had a plan. There was a replacement computer shipped to me. Later that day, I was back working again. It was because the process was put in place. It wasn’t just investing in the hardware or whatever, but it was also putting the plan in place to get me back working in as quickly as possible.
Todd Nielsen: Yeah. Tom, you’ve talked about this aspect in terms of business velocity. Can you talk a little bit about this compounding effect on the negative or the positive? How that affects velocity and what it is?
Thomas Douglas: Yeah, well, it’s a little bit of a detailed conversation, so bear with me for just a second as we talk about it. But it takes an entire set of tools and applications in order to make a business run like it’s supposed to. The compounding effect though is that businesses grow and they get more complex. Well, what they have a tendency to do is to go out and buy an application that they need to solve a certain problem. Then they bring that inside the company. Then months or years later, the business continues to grow and change. They go out there, buy another application, and they bring it in and another application bringing, and another application and bring it in.
Thomas Douglas: What can happen if you’re not careful is that you have so many applications that oftentimes overlap in their capabilities inside the business that you have app sprawl. You have server sprawl, you have complexity sprawl inside the business. So one of the things that we take pride in doing is helping organizations to come in and simplify that so that you have the smallest amount of applications, the smallest footprint of technology that you need to have in order to move fast. When you have a lighter load, you can speed up and you can train better. You can onboard faster, and you can backup your data more effectively, and you can do all those things.
Thomas Douglas: So what we want to identify inside of any organization is what are the necessary applications? What are their capabilities? How do we bring those together? How do we shrink the data and the footprint of technology necessary so the business can speed up and increase the velocity? We also know that as a part of that though, businesses have a tendency to buy the the application as they need at the moment without taking a comprehensive look at the impact that that has. So does that need to talk to something else in the business or does it need to overlap or communicate?
Thomas Douglas: Integration is the key to success in today’s world around IT. So if those integrations and cross data transfer platforms don’t exist, then that really slows the business down. So we want to make sure that the data is necessary from the time that somebody is a stranger to a business to the time that they’re a client doing business on a recurring basis all the way through that process, we want to make sure that the data flows. That allows the business to speed up because where businesses run into trouble consistently is in cross team collaboration. Team one has to hand it off to team two. The information didn’t get from point A to point B. That breakdown is where businesses create friction, and that slows them down.
Todd Nielsen: Yeah, I think that we’ve been talking about the compounding effect of IT. But I think that to close out, we should talk about the compounding result of a great IT. That compounding result goes far and wide. It’s profitability, it’s reduced risk. It’s happy employees and increase morale. It’s increased collaboration. It’s increased productivity, it’s employees excited to come to work. It’s an employee’s willing to work late for a special project. It’s reduced stress on business owners to have more time with your family. I mean, it’s far and wide.
Thomas Douglas: Absolutely. Kristina said it earlier,. At the end of the day, people want to come in. They want to do a great job, they want to love what they do, they want to love where they do it and who they do it with. IT is a major contributor to creating that environment. When businesses fail to put a solution in place that allows people to become the best version of themselves, to enjoy their job, and to feel like they’re contributing, then it becomes the detractor or the focus area of I just can’t get my job because IT sucks. That’s a really bad environment.
Thomas Douglas: The flip of that is that I come into work every day, and my stuff gets done. I don’t have to worry about my backups. I don’t have to worry about managing the day to day. I don’t have to worry about whether or not my computer’s going to come on or not. If it doesn’t, I know it’s going to get resolved quickly. That peace of mind allows businesses to speed up and to focus on the things within their business that really do matter. There’s so many great missions that businesses have, that’s what we want IT to deliver.
Todd Nielsen: Awesome, great conversation. I think we’ll end on that high note. Until next time, stay safe.
Thomas Douglas: Thanks. See you.
Kristina Coons: Yeah.
Thomas Douglas: Take care.