SMEs: Do business the smart way

Speedy IT purchasing decisions can be beneficial both to SMEs and their suppliers

Small to medium-sized enterprises (SMEs) can actively manage their IT hardware to provide continuous replacement of IT assets, which creates a balance between business value and intrinsic residual value to ensure an optimum platform is in place at all times. Another way to get the most out of IT investments is through smart procurement. This is something smaller companies use to provide IT for the business.

Business services provider Brookson is one such company. Founded 17 years ago, Brookson has 170 staff and provides real-time accounting information, acting finance, accounting, human resources, and law specialisation services for self-employed people.

While Brookson is a relatively small business, IT director Lee Kingshott faces many of the same challenges as IT leaders at much larger organisations might because the company provides outsourced business services to 9,000 customers.

Agile thinking

The biggest difference between small and large firms is that smaller companies are able to make decisions quicker, he says. “The procurement process in large organisations is longer, but SMEs do a lot of due diligence. SMEs are more agile – they are able to pick relevant bits of procurement to tailor their risk appetite,” says Kingshott.

For instance, Brookson previously built a portal for its customers using Silverlight. The app, called Connect, provides an online document repository. It contains scanned HM Revenue & Customs (HMRC) documents, expense claims, invoices, payroll information, invoicing, bank statements and video tutorials. But the company needed to migrate from the Silverlight platform as Microsoft’s product strategy shifted. It was also keen to roll out Connect to tablets and Android devices. It took just five days to take the decision to migrate from Silverlight to an HTML 5.0-based portal, and the HTML 5.0 version of Connect was completed and tested in four months.

Working for a small company can be more attractive to suppliers than large enterprise contracts

Market knowledge

Kingshott purchases Gartner reports to understand what is happening in the market. Brookson has a small number of suppliers, which it tends to keep for a long period of time. It has worked with Microsoft, for Navision, for four years; the Connect customer portal supplier for eight years; and has recently begun working with Bytes on managed print and document management. Kingshott’s goal is to buy off-the-shelf products where possible.

“I don’t want to reinvent the wheel. We need third-party off-the-shelf software that can be implemented quickly,” he says. The Navision ERP system took four months to implement, which Kingshott describes as “massively quick given the amount of customisation we did”. Navision 2009 is used in much larger organisations, but it fitted the way Brookson works. “We run 9,000 companies’ data through the ERP system, hence the need to look at Gartner’s recommendations,” he says. Kingshott also uses suppliers’ websites, follows up customer reference sites, and talks to customers – a similar approach to due diligence that a larger organisation would undertake.

“For Navision, we spoke to three reference sites,” he says. Navision is used to help Brookson’s clients manage cashflow by taking a data feed from customers’ business accounts to calculate their tax position and track their bills. Brookson has recently begun working with Xerox and Bytes. “We were spending an inordinate amount on managed print,” says Kingshott. “After speaking to Bytes, we have now installed multifunctional devices [MFDs], which are securely managed.”

The MFDs only print when a user physically goes to the machine with a smartcard. The contract also involves document scanning. “HMRC is making great inroads in XBRL [extensible business reporting language], but there is still a long way to go. We are sent lorry loads of HMRC documents from our customers, and use OCR [optical character recognition] software to upload the information,” he says.

SME partnerships Working with a small company can be more attractive to suppliers than large enterprise contracts, due to the nature of the tender process. “We have clients in large corporates and SMEs,” says Paul Strout, corporate account manager at Bytes Document Solutions. “We will grab opportunities in SMEs, but are more cautious with corporates.” The reason, he says, is that the return in large corporates can take 12 to 18 months, whereas SME sales cycles can be three to six months. “We put in a lot of time and effort to assess the customer, talk to key stakeholders and understand the mission objectives,” says Strout. What sets SMEs apart, he says, is the willingness of people to stand by their decisions.

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