Fitek UK’s Mark Baterip looks at how the reducing cost of technology is allowing SME’s to compete with bigger businesses.
As a child growing up, I would often hear my very working-class parents bemoaning how much easier things were for others. My mum would say, “Money makes money”, a phrase that I didn’t wholly understand then – and perhaps still don’t. In business terms, however, I recognised very quickly the benefits that big businesses had over smaller competitors and how the economy of scale did, to some extent, give an unfair advantage.
In the early 2000’s the company that I began my tech career with, worked with a large financial organisation to fully automate their accounts payable process. The upfront capital expenditure alone was in the region of £100k with ongoing monthly costs of more than four figures. This company were informed at three separate points that there was no business case for this purchase, that the ROI would be in tens of years and that my company were a little uncomfortable.
The customer informed us that the purchase was purely to add a level of accountability, process and compliance that none of his competitors had. His purchase had little to do with business process but more so was designed to give him a message to his potential investors that none of his competitors could match.
Nowadays, such lavish purchases have thankfully become much rarer. A similar system would probably cost a fraction of those figures and, ultimately, that company would find that competitors may well have similar solutions. The implementation of modern technology, and the falling cost of it, is making for a far more level playing field which is more accessible for SME businesses.
The advent of Industry 4.0 in manufacturing, environmental levying in public sector, and just the continual striving for efficiency in business, will make the need for effective deployment of technology a key focus for all leaders and owners of businesses. At Fitek we work with leaders as part of financial transformation projects, and we have learned that, in whatever the sector, they all have some very similar key questions:
1. What am I aiming for?
With technology changing so quickly, it is almost impossible for leaders to keep abreast of what is available to them. Technological change must be driven by a clear and shared message of what is being aimed for in the business.
The nine ‘pillars’ of Industry 4.0 are all designed to show how a focus on different technologies is necessary to improve the efficiency of a business and reduce the impact on the environment.
However noble, these nine pillars are a ‘how’ not a ‘what’. Leaders are often left unclear as to what specific aims should be. Over-complication does not help as a mandate for change.
At Fitek we keep our messages about technology simple and, although our solution has elements of six of the nine pillars, these simple messages help leaders to understand their key aims:
- Will it make the lives of my staff easier?
- Will it reduce my costs?
- Will it make my processes more efficient?
- Will it reduce my carbon footprint?
- Will it make me more profitable?
2. Where do I start?
At the recent Insider Media Advanced Manufacturing Conference in Manchester, delegates heard from Richard Hagan – CEO of Crystal Doors one of the UK’s most technologically integrated and efficient manufacturers. He has a business that leads the way in automation and efficiency, but he made a clear point that he started by making very small and very achievable fixes to his processes.
Delegates were encouraged not to be overwhelmed by the challenge but to see it as a real opportunity to use available technology to make sustained improvement to their businesses.
The FitekIN solution is one such ‘fix’ that businesses have employed to remove costly manual processes from their accounts payable processes. This is a very small part of an overall business but offers a very manageable, measurable and cost-effective quick win!
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3. Can I afford it?
As already stated, the cost of technology has come down significantly over the years. Cloud based storage has removed the need for on-prem servers, actual hardware is so much cheaper than poorer, less powerful predecessors and, generally, staff are much more used to using technology in their daily lives.
All that said, it still has to be paid for.
Fitek recently sponsored the Digital Government conference in London. It was very interesting to see how Public Sector customers were able to invest in technology but had a rigorous ‘spend to save’ agenda. Technology should always be measured in ‘how much it saves’ not ‘how much it costs’.
Over 20 years in our sector has given Fitek an approach which maximises the potential saving and shortens the ROI cycle:
- A capped implementation fee which can be spread over the term of the agreement
- A service cost which is per invoice, meaning you only pay for what you use
- A software cost which is seat based and tiered – allowing for growth in numbers
- NO further costs at all – training is done as part of implementation and the development roadmap is rolled out to all users with no uplift
This flexible approach to our costing model, with a focus on ROI, allows our SME customers to enjoy benefits that were previously only available to companies with much bigger turnover and much deeper pockets.
If you would like to discuss anything in this blog, then please get in touch with firstname.lastname@example.org