As part of a regular series powered by Dell, BetaKit asks prominent leaders to share how technology has evolved since they first launched their business careers, before predicting where it will take them.
As an IT consultant for most of his career, Matthew Trotter knows a thing or two about the technological hurdles of scaling businesses. A Principal Consultant and Data Centre Solutions Executive at Dell EMC, Trotter has a portfolio of over 2,000 small Canadian businesses that he advises, helping clients understand the technological architecture required to build a thriving foundation for growth.
What was the state of technology when you started your career?
When I first started my career, I was an IT consultant. Times were crazy back then because you had no choice but massive capital outlay. If you needed email for instance, you’d just go buy a whole server, but then you needed someone to run it. You’d either have full-time staff if you could justify it, or leverage consultants who would be working for 10 to 15 businesses at any one time.
At the time, you owned all your technology. You purchased the servers, you managed the consultant or staff, and you dealt with all the issues that arose.
If you needed more resources, you would have to go buy more and put in purchase requests that could take weeks to get approved, so you would always oversize the solution. This led businesses to having way more infrastructure than they needed.
Back then, business IT owned everything. They had huge budgets, a lot of control and power, and often got the chance to centralize and ‘okay’ every purchase.
What struggles do you see small businesses facing today with modern technology?
When virtualization and cloud technology started getting big around 2006 to 2008, the struggles shifted. Before then, small businesses had the issue of capital outlay for technology.
“The challenge today is investing large amounts of capital into buying technology.”
After cloud proliferated the number of technologies on the market, it became an issue where companies didn’t know if they were choosing the right technology. Cloud, though, brought many positives. For one, it gave small businesses choice. It also solved the problem of needing to purchase additional bandwidth just in case, because with cloud you could scale capacity up or down as needed.
With cloud technology, however, comes a power shift in business. What I mean by this is that businesses of any size can reduce IT overhead costs through simplified infrastructure, better security, operational automation, and end user self-service. Cloud becomes the core building block of transformation. It allows you to work from anywhere and access everything at any time. It makes collaborating with clients and colleagues seamless and efficient. These competitive advantages are no longer available to only large businesses, but to everyone, shifting the power and dynamic of business.
So that old IT spending is now going towards sales and marketing to purchase technologies that might previously have been the domain of IT?
Exactly. And IT is losing control over those investments. In businesses where IT has kept a fixed focus on basic services like email, those departments are becoming further segregated in how they operate. Those department budgets are being reduced because a lot of those services can be removed from IT.
This is a problem not because of tech; the tech is better now than it was. It’s a problem where different departments bring in their own technologies, creating tech debt and redundancies in the organization.
The money from the business being spent on IT is very focused on keeping the lights on. This is because the business is not actually seeing value in IT. Most of the time they believe it’s “plumbing” – email, infrastructure, etc. But in reality, IT is becoming the business, i.e., data analytics and other things that help businesses become more competitive in their industry. So using those dollars towards innovation projects — solutions that drive business value — versus bricks and mortar IT investments is a huge concern.
There is so much benefit in terms of time and cost in having one IT partner who can advise on current needs while understanding your road map for future business growth. At Dell, we can help businesses build solutions that scale. Rather than making one-off purchases to solve point-in-time issues, we can align purchases with a longer-term plan.
Are there tools or support systems available now that are crucial to small businesses navigating this power shift?
Now we are seeing that public cloud technologies are great for elasticity and shifting large capital costs into recurring operational expenses. This allows businesses to leverage virtual computing, application and data storage resources on an as-needed basis with the flexibility to scale, but it’s also very expensive.
“A lot of businesses only look at initial dollar amount and completely ignore the operating costs associated with the solution.”
Starting out in a new business, it makes a lot of sense to use the public cloud. But once your business starts growing, the costs start adding up and become more than if you built and operated that infrastructure yourself.
IT and digital transformation isn’t about flipping a switch. It’s about looking at the highest value projects. There’s often a lot of legacy infrastructure that’s been there for years.
Modernizing those systems and integrating new systems help enable businesses to be more operationally efficient. Businesses looking to be more competitive need to consider if the investments they want to make are the ones that will pay dividends.
What do you think is the next big trend in technology and how will it impact the way we work?
Hyper-converged technology is the trend.
Initially, we had on-premise technology that involved costly segregated servers and consultants with a lot of inefficiencies. The single biggest driver right now is cloud – automating and simplifying your operations while enabling end user self-service. It’s been a hot button for the past five years.
Hyper-convergence brings the operational efficiency of the public cloud – self-healing, one touch upgrading, etc. – and builds that into on-premise infrastructure. Essentially, hyper convergence allows businesses to reap the agility of public cloud infrastructure without surrendering control of the physical hardware on site.
As small businesses grow, it’s now a holistically curated technology experience.
Where do you think the future of work is headed?
The challenge today is investing large amounts of capital into buying technology. Thinking about it as a small business, the challenges are always time, dollars, and getting the most from both of those. More technologies and business expenses will become operationalized, which means large upfront or one-time purchases will seem expensive by comparison.
But it’s not one size fits all. The big trend is transitioning customer environments from legacy to hyper-converged platforms, where we can see operational cost reductions. When you consider the cost of operating and managing the equipment over five years, hyper-converged solutions are substantially cheaper in the long run.
A lot of businesses only look at initial dollar amount and completely ignore the operating costs associated with the solution. They need to look at it as an investment instead of just a capital outlay.
It won’t be the case for every small business, but any customer buying today needs to make sure those solutions can address the rapidly changing business goals over the next three to five years. Now that technology is catching up to those needs, you must invest in technologies that enable your next transformation.
Photo via Unsplash