In the movie The Empire Strikes Back, you may remember, the great sage, Yoda, tells Luke Skywalker, “Size matters not.” But according to a group of IT leaders who met recently for the CIO 08: The Year Ahead conference (run by CIO.com’s publisher), size certainly matters when we attempt to engage large information technology consultancy firms. These vendors don’t seem to want to do business with small to midsize organizations, even though we have money to spend.
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One IT leader who came from a large shop before landing in his current role said it was difficult to get phone calls returned from the once “cozy” vendor—whose sales reps were eager to talk to him when he commanded a larger budget. Another observed that the talent his vendor provided was “green.” Finally, a few expressed disbelief at vendors’ pricing; it appeared these vendors were geared only for large organizations with large IT budgets.
Vendor Help Wanted
I have experienced some of the same frustrations. For two years I have been employed as the director of information services at the nonprofit Sequoia Community Health Centers in Fresno. Sequoia’s primary purpose is to provide outpatient care to the most disadvantaged citizens in the Fresno area. In 2006 alone, Sequoia healthcare professionals saw more than 37,000 patients.
Because we rely on grants and government funding, it’s more difficult for us to fund strategic IT projects than it is for for-profit organizations; however, that does not mean IT gets a pass on providing outstanding technology to our colleagues. IT must provide strategic value to the organization and must be nimble enough to respond to changes in our organization.
Sequoia’s IT team has nine members. With such a small shop I have to spend a great deal of my time maintaining operational excellence. However, my role must move from an operational one to one that is more strategic. During my first year at Sequoia I concentrated on improving the processes that affect operational excellence. With these processes largely working, I must now spend my time providing a technological vision for Sequoia. Because I am a member of the Executive Leadership Team (the primary operational management body), my CEO also expects not only technical vision but business vision as well.
As an example of this push to address strategic concerns, language was inserted into Sequoia’s five-year strategic plan that mandates that a disaster recovery plan be completed by December 2008. As you can imagine, creating a fully functional disaster recovery plan requires an enormous amount of time—and, as I noted above, I’ve been focused on operational excellence, not long-term strategic planning. To provide me with more time, my CEO authorized me to hire an IT manager in early 2008 to maintain operational excellence. However, even if I had a fully trained IT manager in place already, I do not have the expertise to create a plan that can withstand the scrutiny of auditors and Sequoia’s board.
I felt an experienced consultancy could help me develop the disaster recovery plan, and so late last year I attempted to engage IBM. But the cost was out of Sequoia’s reach. I was surprised at IBM’s lack of interest in Sequoia. I had a budget of $25,000 and wanted to give it to IBM. Yet it was clear from talking with my IBM representative that Sequoia (because of our size) was not the right fit for IBM.
Herein lies the problem. Just because Sequoia is a $25 million dollar organization (in revenue), that does not exempt us from some of the same challenges that larger organizations endure. Although $25,000 may not seem like a large amount to IBM, imagine if they had many customers similar in size to Sequoia.
What Would Yoda Do?
Not only are the IBMs of the world leaving money on the table, they’re also risking future sales. The IT leaders at small organizations will in many cases be employed by larger organizations someday. Why alienate them? Vendors could engage IT leaders in small organizations now and build brand loyalty.
How could they make such a business model work? Let’s imagine (with apologies to George Lucas) what Yoda might do if he were running a large consultancy. For one thing, I’m sure he would have a dedicated group of Jedi Knights sworn to serve those in technological need. These Knights would not be Padawan Learners (the Jedis in training) but rather full-fledged Jedi Knights with at least a few years of experience behind them. As the IT leader of the smaller organization moves to larger organizations (or expands, as Sequoia is expanding) Yoda would have another group of Jedi who could handle more complicated problems. The handoff would be seamless, quite possibly keeping the same Jedi Master account manager in charge.
Yoda would also have a menu of consulting options that could be utilized for smaller organizations. These menu items, such as disaster recovery, could be geared in price and scope to fit organizations of different sizes. By having a menu of consultancy options, IT leaders of smaller organizations could plan and budget for these expenditures more easily.
May the Vendors Be With Me
Certainly the struggles of a multinational corporation are far more intense than my own, but I can learn from them and apply their tried-and-true management principles to Sequoia. That’s why I spend time sharing information with other CIOs. But to help me implement those best practices, I’d like access to the same expertise that my colleagues at larger companies have.
That is out of my reach budgetwise. But it doesn’t have to be.
Michael Gaskin is director of information services at the nonprofit Sequoia Community Health Centers in Fresno and is a member of the CIO Executive Council.