A company has outgrown its IT systems and the founders are divided over whether to invest in a more sophisticated network. The company's resources have been stretched recently by an acquisition and the setting up of a subsidiary in Germany. The various parts of the business use incompatible IT systems.
This could be the ideal moment to insist on a unified approach. The group needs to determine whether a new system will integrate what is now a geographically diverse business and whether, by replacing or upgrading its systems, it can offer more to its suppliers and customers and outstrip the competition.
A good look at the existing systems will help it to determine whether to replace all of them or simply upgrade parts. Either way, if the investment is made, the company must prepare itself for a transitional phase. Would upgrading in stages reduce the financial or commercial risk? If so, what are the priorities of the business? If it plans to invest in a new system or upgrade, what can be bought off the shelf and what should be customised? It should work out how to upgrade continually and who will be responsible for the system's maintenance. Outsourcing may be an option.
The group must also decide how it will use the system. Will all staff have access to it anywhere and at any time? It must also work out how the system will be financed. Most importantly, the founders must get board consensus on what to do and on who is going to do it.
- Appoint a project sponsor, ideally from the board. This needn't necessarily be the most enthusiastic member.
- Appoint a project manager - a good decisive implementer and communicator who pays attention to detail and will be resilient.
- Review the business processes before the systems.
- Make compatible, as soon as possible, the IT systems of the acquired business and the German subsidiary.
- Concentrate on areas resulting in benefit to customers.
- Basic activities such as financial reporting and contact management are generally cheaper to buy off the shelf. This reduces risk and leaves space for development of company-specific systems.
- Check the IT plumbing between hardware, communications and software.
- Expect some stress and don't take on a simultaneous big project.
- Make training a priority.
Patrick Dunne works with 3i.