There are many trades that require little or no technology — street performing, for instance — but yours is probably not one of them. More likely, yours is a "knowledge economy" business that requires some connectivity to the global information network. And without decent technology, you'll be competing with at least one hand tied behind your back. The question is, "Which technologies do you really need?" Whatever your business, it's worth remembering some principles of technology investment.
First, your technology does not have to be the coolest in town. In fact, cool usually means expensive, and startups are always short on cash. (Plus there's the small matter of a recession.) Far more important is reliability and uptime. You will have plenty of demands on your time as a startup entrepreneur without having to worry about fixing your technology. So be wary of cool, especially Version 1.0 of anything, unless it's fundamental to your business. Get the tried and true.
Second, remember that you can't do everything yourself, and you don't want to spend a lot of time finding the right people to help you. That's why it's a good idea to stick with the leading brands — they have support systems built around them, including consultants, programmers, trained service professionals, supplies, good online help, add-on technologies and so on. If you pick an off-brand item, you could be on your own.
Third, while you may save a few dollars by buying used equipment on eBay or craigslist, you're up a creek if the equipment breaks down — either you'll lose time (which is money) trying to fix it yourself, or the repair bills will counter any savings gained from buying used equipment. So think about total cost of ownership rather than lowest initial price. You might even consider an extended warranty; it's highly profitable for the vendor, but it could be highly critical for you.
In an ideal world, your technology should not get in the way — it should be as unobtrusive and reliable as the power coming out of your electrical outlets. A good approach is to minimize initial investment but ensure a smooth growth path.
1. Desktop/Laptop Computer
Whether you prefer a desktop or a laptop computer as your primary machine, this is your "base of operations," where you write your business plan, do the financial projections, create the presentations for investors and customers, and much more (see Microsoft Office or Equivalent Applications, below). But before you buy that new machine in the retail store window, take a page from the big business IT playbook: Standardize on desktops and laptops to reduce support differences. Pick a leading brand such as Dell, IBM or Hewlett-Packard, identify which models you'll allow in your business, and don't buy anything else for you or your employees.
2. Microsoft Office or Equivalent Applications
The Microsoft Office suite - Outlook, Word, Excel, PowerPoint (and optionally Access and Publisher) - gives you 90 percent or more of the software applications you need for running a typical business. The applications are well-designed (consider how much money went into them), and if you get the suite with a new PC, the cost will be reasonable and money well spent. But if you feel that much of the 500MB the suite takes up on your hard drive is so-called "bloatware," you have other options. Among others, Google has been encroaching on Microsoft's space with a series of online applications (known as SaaS , meaning software as a service ) that includes word processing, spreadsheet, calendar, email, desktop search and analytics. The upside: They're free and take up virtually no space on your hard drive. The downside: If you lose your Internet connection, you lose access to your applications.
Unless you have a phenomenal memory, you'd do well to get an iPhone , BlackBerry or Palm and synchronize it with your desktop calendar, tasks, contacts and possibly email. Combine this with the smartphone's standard voice and text messaging capabilities, add an ever-growing number of third party applications (especially for the iPhone), and you have the makings of real mobile productivity. Developing story on this front: the new breed of netbooks, for those who want something between a laptop and a smartphone.
Before they promised us a "New Economy" in the 1990s, they promised us the "paperless office" in the 1980s. That didn't pan out either, so you'll probably need a printer. But a decent black-and-white laser printer may be a better choice. For a modest investment, you get sharp, professional-looking documents that look the same as those of Fortune 500 companies. For internal use, consider an all-in-one device that will print, copy, scan and fax. Just remember this: Nothing says "unprofessional" like a brochure printed on a cheap color ink-jet printer. So outsource high-profile color print jobs - because first impressions last. And especially with printers, always consider lifetime ownership costs: In this situation, the printer is the razor and the ink or toner cartridges are the razor blades.
Once you pick out your laptops, desktops, netbooks, mobile devices, printers and whatever else, you want them all to talk to each one another. This means networking. The internal network connects your devices to each other; the Internet connection (usually DSL or cable) connects your internal network to the "cloud," or the millions of outside networks that constitute the Internet. In between the inside and the outside is your firewall, which is designed to protect you from the nasty things that breed on the Internet and that can bring your business to its knees. Unless you are technically savvy or you can make do with peer-to-peer networking and basic security, you should consider bringing in a professional to configure and maintain your network.
6. Phone System
POTS (plain old telephone service) is now considered quaint. And the available choices are overwhelming. For example, you can get your own toll-free number and an automated attendant to answer calls; when a caller leaves a message, it's forwarded to a designated phone number and is also emailed to the user's business. But what do you really need? It may be as simple as a dedicated phone line for you and each of your employees, together with automated attendants that the phone company provides. That will give you voicemail, call forwarding and some other basic functions. As you grow, you'll want some switching capability. PBXes these days can be tangible (and expensive) or virtual. Virtual solutions are the voice transmission equivalent of SaaS - you don't own anything, you just subscribe. Also, voice communications can be delivered via phone lines or via VoIP. VoIP is all the rage and presents considerable cost savings. The problem is that if your Internet connection goes down, so does your phone line.
A server is a computer that has been optimized for one or more specialized applications. For example, a database server may have large hard drives (hardware) and run the Microsoft SQL Server database system (software). If you're a three- or four-person company, you may not need a server at all. But as you grow, you'll want to offload certain processes from individual desktops and laptops to one or more dedicated machines. This enhances performance and makes your IT infrastructure easier, faster and less expensive to maintain. Again, unless you're tech savvy, you should probably outsource the setup and maintenance of your server(s) to an IT professional.
Someone has to track the money coming into and going out of the business. While it's tempting to find a good bookkeeper and wash your hands of it (aside from the occasional report), it really behooves you to stay on top of your cash flow - even when you have a bookkeeper. For a startup business, cash flow is life or death and sadly, fraud and embezzlement is rampant. So pick an accounting package to standardize on - Intuit's QuickBooks is the dominant player, followed by Microsoft Money and Peachtree. Then learn the basics and make sure you can at least keep the general ledger and generate basic financial statements and reports.
9. Sales/Contact Management
If yours is a high-volume business with many prospects, customers and cross-selling opportunities, then a contact management system such as ACT or Goldmine may be for you. Alternatively, there's Salesforce.com, the poster-child for SaaS. But do you need contact management software? You may be a low-volume, high-price vendor. Or, as a startup, you may not have that many contacts to manage. For folks like you, Office 2007 Small Business Edition includes the latest version of Outlook Business Contact Manager. It is an effective way to manage contact lists, schedules and to keep notes without having to buy complex CRM software.
10. Collaboration and Remote Conferencing
This revolutionary technology, which allows remote workers to share documents and applications in a virtual collaboration space, should get the Congressional Medal of Honor or something. Imagine the billions in travel costs saved by not having to give every demo or training session in person. Imagine the benefits to the environment as well as the gratitude of road warriors who avoid airport frisking, jet lag and time away from family. The gains in productivity are immense, which explains the many offerings in this category, including WebEx, NetMeeting, Citrix's GoTo services, Central Desktop and others. And don't forget the traditional solution: conference calling. With or without a shared desktop, you'll need conference calling capability. Among other options, there are now free offerings such as FreeConferenceCall.com, which allows small-business users to make conference calls free of charge. And then there is messaging software (such as Yahoo Instant Messenger), an inexpensive and reliable way for small businesses to keep in touch with their employees, partners and others.
So those are the technologies your startup business can use. For a perspective on technologies your business can't use, try here .
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