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Reasons Businesses Should Invest in IT Now

June 20th, 2009 – Des Moines, IA

Dan Emehiser, COO and Managing Partner, Fulcrum Consulting

“Technology has become so interwoven into how a company operates that it's no longer considered discretionary spending," says Dan Emehiser, COO and Managing Partner of Fulcrum Consulting, “IT projects often times are the competitive advantage that propels a company forward. They allow a company to be ahead of the curve. With all the economic doom and gloom we're hearing these days, it's easy to forget that there are still plenty of organizations that look to utilize this downturn in the economy to leapfrog the competition.”

Some technology requirements are no-brainers, like keeping antivirus software up to date or complying with the regulatory guidelines. Other IT plays are strategic, geared toward cost cutting, gaining an edge on the competition or taking advantage of great prices.

Why should businesses buy technology services right now?

The basics are more important now than ever.

Companies need to keep to their basic business functions in motion during the recession. What that means in terms of IT spend is that organizations that have profited from managing technology refresh cycles wisely should keep it up. A Managing Director of one of Fulcrum’s largest customer’s sums up the need for spend: "Even though the economy has slowed, the demands on businesses have not. Security, productivity, data storage/backup and regulatory requirements are among the IT needs that continue to increase for most businesses."

Know your infrastructure. Identify the good and the bad and make sure you have the basics in place. The delivery of the core services is what you will ultimately be judged on and nobody is going to care how clever or innovative you are if the basics don’t work.

To get an edge on the competition.

Technology isn't simply a business need, it's a business driver. Better and quicker information exchange, more useful metrics and increased productivity all are made possible by technology. Dan Emehiser says, "Having a competitive edge in today's tough market and having the ability to remain flexible and respond to the market as it undergoes change is more important than ever. If the capital is there, spending on technology is a great investment for businesses to make when others cannot. Technology today is what is enabling companies to have a strategic advantage."

Two points to consider: Go to your customer. Don’t wait for them to come to you. Take them ideas and introduce them to your top talent. Understand your customer and your customer’s customer. What does success look like for them? Can you measure and deliver in ways they understand and can absorb. What irritates and frustrates them about your service and delivery?

Look for new services and technologies and divert whatever effort and funding you can squeeze from current budgets and programs to stay ahead in preparation for the eventual upturn.

To save money in the long run.

Even in the short run -- as cost-cutting IT practices like virtualization and remote systems management have matured, so too have their return on investment improved. "Companies should buy now if they're looking at a virtualization project," says Dan Emehiser "It's a very quick ROI, sometimes within months, and you can also justify it by savings in cash flow because you've reduced other expenses in the operation."

The three "Rs" -- return, return, return -- are keys for the Infrastructure head of a national healthcare customer: "It's a question of ROI. You are probably not installing an ERP or implementing data center consolidation for the fun of it -- you are trying to raise your top line or reduce expenses. If the business case is sound -- say, investing in IT that delivers strong ROI like virtualization -- then the project should go ahead." This Fulcrum customer thinks the IT industry is especially poised to benefit as stimulus funds start to flow: "As the U.S. stimulus package begins to impact the economy, the channel will be able to respond quickly with solutions and services that were not available in the past and provide operational savings in the future. The channel, which has led in all of our last three major process technology transitions, offers a high service value in that they can quickly upgrade their customers' installed technology base for greater efficiency and output and thereby help them to remain competitive."

Because rates have never been better.

With consultants desperate to keep consultants busy in an incredibly rough market, it's possible to engage technology services for "extremely good rates," says Dan Emehiser, “but it won’t last forever."

To prepare for the eventual recovery.

We continue to "prepare for the turnaround" as talked about by customers and other vendors in our business. But the depth and breadth of the current downturn is clear. Most are dialing back the recovery talk in favor of focusing squarely on sustaining their respective businesses. "Normally, you would say, let's build up our competitive advantage, let's buy technology while it's relatively inexpensive. But this is a biggie. It's hard to think about the recovery,” says the CFO of a national retailer. "If your company is in financial trouble, preparation for recovery doesn’t mean anything. But if you are liquid, then yes, you should be thinking more long-term."

“It's true that the conversation isn't going to work for every business in this climate”, says Dan Emehiser of Fulcrum, “but those that are relatively healthy should be addressing critical problems in order to come out of this challenging time in a much better position to compete."

About Fulcrum Consulting: Drawn to the company’s client focus and consultant first philosophy, large businesses have turned to Fulcrum Consulting for business guidance and the provisioning of IT and Financial staffing services to help them meet their business goals and objectives. Founded in 2003, Fulcrum Consulting has grown to become a market leader in business consulting and IT Professional Services. Please direct questions to inquiry@fulcrumconsult.com

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