An eye-opening discussion about how forward-thinking businesses look at I.T. as an investment. Discover how great technology saves you money in unexpected ways and bears fruit that positions your business for greater profitability.
Speaker 1: Welcome to The JMARK Business Innovation Technology Experience.
Todd: Okay. Welcome again on our marathon afternoon of broadcasting out to Facebook. This time, we are going to dive into another topic that is really probably on just about everybody’s mind right now, and that is saving money. And we were talking about this the other day, the idea of saving money with technology. Probably shouldn’t have a cough drop in my mouth while I’m talking. Been a lot of talking today. The idea of saving money with technology, many people equate to the bottom line. It costs $5,000 or $6,000, $5,000 is cheaper. But the truth is that it’s not so black and white. There’s a very large gray area, because it can translate into a lot of different areas. So, Tom, what are some of the different areas that we see value in technology that really equates to the bottom line?
Tom: All good questions and good topics, and there’s a myriad of areas. I think the first and for most organizations, people, and the cost of people are their number one expense. And so if you’re putting bad technology in front of good people, you’re going to get adequate outcomes advanced. And so if you think about foundationally, what is the purpose of technology? And it is to create efficiencies, it’s to create outcomes, it’s to empower people to be successful, to create outcomes. And if the tools that you’re putting in place have security problems, have risk in them from a business continuity perspective, or simply just don’t run well or have consistent problems, then you’re slowing your whole organization down. You’re creating a drag within the business, and when IT becomes drag in the business, it can cost your turnover.
We’ve had multiple stories where we worked with a prospect and someone for the first time, and the reason that they finally decided to really double down and focus on their technology is because either people came to them and said, “If you don’t fix this, I’m leaving,” or in the exit interview, they said, “I’m out the door because I can’t get my job done, I can’t be successful and so I’m leaving.” And as a result of that, it’s like, “Oh man, I just lost my best salesperson who couldn’t get their job done, who couldn’t sell fast enough and couldn’t produce the commissions, the income that they wanted individually, and so they went somewhere where they can.” And that’s just one of many examples. Didn’t dive into security, didn’t dive into anything else that it is very real and how it’s not the bottom line.
If you’re looking at technology, and this is how much I’m spending on technology, and can I save money, chances are you’re focused in the wrong areas. You should be focused in an area of the business of, what am I doing that accelerates my company, protects my company? Removing the costs in IT generally have kind of a compounding negative effect on a company’s ability to be successful.
Todd: So Tom, if I were looking for a technology provider or looking to save money on technology… And a lot of people right now are… the situation is they are really trying to save money, for many reasons. But if I were looking at this and I heard that, my mind would go, sales pitch, sales pitch, sale pitch.
Todd: How do we get someone to stop thinking about that number and see the holistic view of what technology actually can do for an organization?
Tom: Well, I always go back to analogies, and I think one of them that answers that question is, you wouldn’t deliver car engines in a Toyota Corolla. You buy the right product that aligns with the purpose that it needs. And in many organizations, they want their team to produce high volume. They want them to produce at a high level, like a school bus. You can buy a Toyota Corolla, and it costs a whole lot less than a school bus, but you’re going to make a hundred trips back and forth in order to get the kids to school, and it’s very inefficient and ineffective. That same analogy applies in technology. There’s a lot of ways to cut costs and save money, but it creates so many byproducts and inefficiencies within the business that it actually hurts the company longterm.
And so I guess I would answer that by saying the way that you do that is you challenge what creates drag in the business. What empowers people, what sets people up for success most effectively. There’s obviously training. You have to make sure that people have the skills and the passions and the desires to do what you need them to do in those roles, and then they have to have the tools and the capabilities to deliver on them. And if you’re not setting people up and giving them the capabilities to have all of those things, then it’s your own fault that your business isn’t successful at that point. It’s nobody else’s. And so it’s being willing to take that step back and say, “What gets it done?” And the answer is, it takes people good with good technology in order to create the outcomes.
Todd: I think the one other thing that I would add to that is, what has the potential to create drag that is not there right now? And that is generally around security, or something that is reaching into life, or perhaps your IT provider is too small for you. And so there’s these things that potentially, at some point, will cause you problem or could cause you problem, and that could be really, really, really, really big in the case of a security breach or something like that.
Tom: Well, in all thing… Oh, go ahead, Kristina.
Kristina: I was going to say at that point too, you’re not saving money anymore.
Tom: You’re exactly right. We know it’s true in technology, it’s true in our houses, it’s true in cars; it’s not a matter of if something will break, it’s a matter of when it will break. And so by not taking the appropriate measures to ensure that your business has safety in it, then eventually, it’s going to start costing tons and tons of money. So whether it’s security and you have a breach, ransomware, and it shuts your whole business down for days, weeks, months, and potentially it could even go out of business, or whether it’s hardware failure, because you didn’t manage your life cycle and now your people can’t work, or it’s something as simple as in a telecommunication team, having the right internet service, so that you can use a SaaS application or a web-based application that has the capability and the performance that you need in order for people to be successful. It’s really evaluating all of those things, and to your point, Todd, in the future, what could go wrong?
Well, I could have a breach. It’s possible that somebody in my organization is going to click on something and invite the bad guys in. How am I going to make sure that I have risk mitigation measures in place? But all that means you have to have a good business continuity plan, you have to have the right security posture, you have to have evaluated where those risk areas are, you have to train your people, you have to put the backups in place, and you have to protect your business from ransomware. And if you fail to do those fundamental things by cutting costs in IT, eventually, what happens is it backfires and it ends up costing you a hell of a lot more money.
Todd: So let’s [crosstalk] talk about the numbers then. Oh, go ahead, Dax.
Dax: Oh, I was just going to flip it and then see what you have to say about the opposite side of that. We’ve talked about fixing things because this is creating drag, holding me back. What’s the flip side of that with what can I add that’s going to accelerate, move me forward faster?
Tom: Absolutely. Well, and there’s a thousand different ways that that can happen. The simplest is by making sure that you’re staying on the right versions, the right capabilities, the right technologies, so that you don’t get stuck behind. So if you have Windows XP, Windows 7, old server technologies, you can’t run the latest applications that you need in order to facilitate the next level of success. Or if everything on the network just runs so slow that every time somebody double clicks on something, it’s like, “I’m going to double click on this and go get some coffee while my application opens up and then I’m going to come back and then it’s going to crash, and then I’m going to go get another coffee and go shoot the bowl with my buddy across the hall and…” It’s what are you doing to make sure that things are running well, it’s a well oiled machine?
We say all the time to people that we’re having conversations, is that your IT needs to run like you expect your car to. Nobody expects to get up in the morning to go out, put the key or push the button in the car and have it not start. Like, the expectation is that it will always start, it will always run as long as you’re doing your maintenance, Same is true with IT. If you want it to always run, you’ve got to invest in it and you’ve got to stay current on those things, so that when you push the button, you can go.
Todd: It’s really easy to… It doesn’t take some crazy trigonometry or anything to run some numbers and figure out some of these things. Looking at the times that computers are slow, doing a survey throughout the company, just pulling some data. Online, you can pull data on CASA breach. In 2019, the average cost for a breach was just over $8 million. The average cost of a record in a breach is $242, I believe. And so if you have a hundred thousand records that were breached, that adds up. And of course, it’s all… these are averages. But when it comes to a mediocre IT environment that is causing a loss of productivity, a loss of collaboration, a loss of connectedness, and it’s damaging the culture, it’s putting the organization at risk, there’s a lot of lots, there’s a lot of problems there.
Tom: Well, averaged bad IT environment is going to cost your average computer user at least one hour a day. So if you think of it in terms of your average salary across the organization of 50 people and your average salary is $40,000, well, out of the average day of eight hours, you’re going to just wipe one away to bad productivity, you’re spending a whole lot of money inside your organization just because of bad IT. And while it is soft costs versus hard costs, it’s very real in the longterm, and I think that that’s the piece that people have a hard time reconciling is, “Well, yeah. I’m going to pay him anyway.”
Like, well, but in a day where the number of people in my organization is critical, I want to have as fewer people as possible in order to run the business, I need to make sure that those people are empowered in order to get as much done, so I don’t have to hire another body to come in and spend another $40,000. And so when we really take that step back and look at it, then those are the conversations we love to have with our clients and prospects is, how do we create a lean, mean organization using IT to drive better outcomes with your people?
Todd: I’d argue that in the current environment that we have going on right now, and as everybody is trying to innovate and transition to whatever the new normal or better normal is going to be, that the speed and velocity at which individual employees and teams and the entire company as a whole can operate is directly tied to your ability to save money. It’s costing you so much more money if you can’t move at a fast speed, if you can’t innovate, if you can’t create products and services where your customers currently are. It won’t matter if you cut a few thousand dollars from your IT budget.
Tom: Yeah, you’re exactly right. It’s about having the capability in order to… In our organization, one of the things that we talk about is finding ways for four people to create the outcomes of five, because that creates better velocity inside the organization and it creates better career opportunities for everybody inside the company. And so if you empower people with the right technology to do that and have really candid and transparent conversations as a company, as a culture around like, “This is how we need to operate. What tools do we need in order to facilitate it?” The answer oftentimes is going to be, good IT. Just make my stuff work, make it safe, make it fast and get out of my way and let me do my job. And-
Todd: Make it secure.
Tom: Yeah. Make it safe. That’s exactly right.
Dax: I think a good example, which is a little bit divorced from the IT, but I go over in the summer and mow my parents’ lawn. And for a long time, there was a lawnmower that I was using that my dad had had for ages, and it would take me forever. And I was always like, “Why does it take an entire Saturday to mow the lawn? What is the problem?” But the lawnmower was working fine, so [inaudible] it didn’t occur to me. And then when it finally broke and I went out and bought him a brand new lawnmower, and the first week I mowed with that lawnmower and it took me like three hours less than it used to, it was like, “Oh, wait, you’ve got the right tool and you’re using the right tool for the job, but not trying to nurse this whole thing along just to save some money.” It saved me an enormous amount of time, and these are the kinds of things that you need to be ahead of it, and then thinking about the problem and not just until a big something occurs to force you to change.
Todd: Dax, you don’t know it, but you’re basically giving some marriage advice right there. I struggled with that same exact thing right there. I have a freaking [inaudible] yard. And when I bought a lawn mower, a riding lawnmower, my wife’s like, “Really? No.” I think she thought it was more of a manliness thing. But it’s like, no, it’s about saving time. It all comes down to time. So, great marriage advice and great business advice there, Dax.
Tom: [inaudible]. Well, I think what you were talking about a little bit there, Dax, is anticipating what it will be in the future. I was having a conversation this morning with an entrepreneur, and we were talking about a new product idea, a new concept. And he said, “Well, what exactly do you want to spend your time on?” And my immediate answer was, “What we need to be focusing on is what could go wrong. What’s going to break, what’s going to slow this down, what’s going to make it not be successful. What do we need to remove out of the way, what impediments do we need to remove to make sure that there’s no doubt that we’ll have a guaranteed outcome?”
And so when we started to peel those things back, it ultimately, oftentimes, comes back to people or technology. And I think when organizations will look at things through that lens of, what could be creating drag, what could be creating problem, why are my people not getting as much done as I would like, or why does it take too long to get a loan application processed or to produce these documents or to interface with the client the way that I want, oftentimes it’s people, training, technology. And when we remove those impediments, then the whole business can accelerate.
Todd: I think that someone could potentially hear that and also think that we’re advocating, potentially, the idea of using technology to get rid of people. But the truth is that when you empower people with technology and with the services that keep them supported and keep them operating fast, your business grows, you can hire more people, you can be more profitable, you can create the culture and the environment that you really want to create.
Tom: Yeah, there’s no doubt about that. Businesses that have that capability will ultimately create way more jobs than somebody who’s trying to fire and replace them with technology. It’s an empowerment and an accelerator to a business, not the opposite. Not an environment where we’re trying to replace people. And a lot of people think that when we’re talking about this, we’re talking about new computers, new servers, new infrastructure, a faster CPU kind of a thing. That’s really not the answer. While staying current is important, the answer is the strategy that goes across the whole environment. How do we make sure this computer works with this technology, with this server in a secure environment, so that we can guarantee velocity?
And so it’s really about a whole viewpoint of how everything comes together, not just a single computer. Because you can put a fast computer on a slow network and it’ll still really run bad, or you could have a fast computer on a fast network with bad security and everything comes crumbling down. So it’s a global strategy that helps an organization to accelerate.
Todd: Yeah, I think that it’s important for people to put aside their preferences and their narratives about what they possibly need in their organization in terms of technology, because often, it is as simple as a tool for collaboration and not using the phone and maybe getting more in front of video, or maybe it’s a project management tool, or something that you are not used to using. And maybe you’re a little bit resistant to the change, and it’s just that simple thing that possibly doesn’t cost very much. But it’s the change in behavior that could potentially create a massive success.
Tom: Absolutely. Speeding people up with better tools, help people to be more successful in their job. Set them up for success.
Kristina: Do you all have any [crosstalk] real-life horror stories of… Sorry, Todd.
Kristina: I was just curious if you had any actual real life examples that you could tell people of horror who are stories, basically, of companies who chose to “save money”, but that didn’t end up being the case.
Tom: Oh [inaudible].
Todd: Oh boy. How much time do we have?
Tom: The easiest one of late… Ransomware is the biggest threat that exists for lots of businesses out there. And over and over and over, we’ve gotten phone calls or messages from organizations who have cut corners or have relied on internal IT in order to do things, but they didn’t have either the capabilities, the tools, the time, the resources in order to make sure everything was managed well. Sometimes it is the IT person’s fault, sometimes it’s not; they’re a symptom of a bad situation. But whatever the case, when you’re cutting corners within a business, it creates risk. It’s like not changing the tires on your car and driving 80 miles down the road. Eventually, you’re going to have a blowout if you don’t take care of it, and the same is true with technology.
So if you’re not investing properly to make sure that you’re creating the safety, the backups, the business continuity plans and all of those things, then you’re going to have some sort of a compromise or problem that slows the whole business down. And so the easy ones to point out are the security breaches and the ransomware. There’s other stories where people didn’t have a backup and the server crashed and they thought they had a backup, but they didn’t and then they lost all their data, or they had to send hard drives off to data recovery companies, and it costs thousands and thousands of dollars to recover data in an environment all the while the business is down.
I can’t tell you how many times we’ve been called into a situation where we’ve never worked with someone and they’re like, “Can you come save us? We hear you guys are good. Please come help.” And we walk in the door and the answer is, “Server crashed, hard drive’s gone, no backups.” Our options are pretty limited. We can help clients navigate through that by using some of our partners and tools to do data recovery, but it’s a horrible situation to be in all the way around. And so when you… Oftentimes, like anything else, when you try to save money, there’s a balance, and eventually the ship is going to right and something’s going to… there’s going to be a reckoning.
Todd: We could tell lots of stories, but what scares… not scares, but what hurts a little bit more is the ones we didn’t hear about. They didn’t pick up the phone soon enough, and now they’re just not around.
Tom: Yeah. And it’s-
Todd: Kind of a sobering thought, but it’s the truth, unfortunately.
Todd: All in the crusade of saving money.
Tom: Our own industry has been playing with it. There’s been a half a dozen [inaudible] service providers around the country who have been breached, and for the same reasons, they didn’t put the proper energy into safety, backups, security, whatever it was. They had a breach, a failure or whatever, and now they’re gone. And it’s bad all the way around when those kinds of things happen and hits the news, and it’s bad PR and it’s unfortunate for everyone involved. And the byproduct of all that is customers who may be harmed in that, who were trusting a technology company to do good job for them. And it’s easy to fall into that. The cobbler’s kids wear no shoes kind of thing, in our industry, you just can’t do it.
Todd: Very true. So in the end, saving money is not always about cutting costs, it’s about looking at the holistic strategy of the organization and how the organization uses technology, how the organization safeguards itself from the dangers and the risks that are out there, and how the organization uses the technology on nearly an individual level to get things done and to move the organization forward. Great conversation, and we’ll see you next time. [crosstalk].
Speaker 1: Thank you for attending this podcast. We hope it has been informative and helped that JMARK, we are people first and technology second. To learn more and discover additional content relevant to your business, please visit us online at jmark.com, or at LinkedIn, Twitter, Facebook and Instagram. You may also call us at 844 44 JMARK. Thank you for your time, and we look forward to seeing you again.