Small Business IT Economics: An Outsourcer or Employee?

    The article is written for small business companies from 20 to 100 people. Important! For medium and large companies, there is a different alignment.

    Content:
    1. Business: consumer or financial
    2. IT: provision (accounting) or attraction (search)
    3. Knowledge: systematic or situational
    4. Person: outsourcer or staff member?


    Business: consumer or financial


    Your business has been operating for several years. It’s easy to tell what you do. There are two main types of activity: either you produce something, or you redistribute what is produced by others. For example, you produce and sell slippers (news, websites or seo) - then your business belongs to the consumer sector. By the way, services are also a consumer sector. But, if you buy slippers (news, sites or seo) for resale, then your business belongs to the financial sector.

    Strictly speaking, the financial sector, as an independent one, stood out from the consumer sector as its component, but now it doesn’t matter, but in general it is a question for the theory of neo-economics, who needs to search and find. And I'm talking about IT.



    IT: provision (accounting) or promotion (search)


    Quite a story. Some have already somehow forgotten that before the appearance of the computer, everything in the world somehow worked and the ships plowed the vast expanses of the vast oceans, along with the construction of unprecedented skyscrapers of the pyramids. That is, there was life, but there was no computer in it. And not to say that someone was very worried about this.
    The main thing that the IT world has been given is information accounting + convenient information search . Actually behind this small one lies the answer to the implied question, how did we live "before that" ..?

    In terms of types of business, the use of IT is very justified. True, you need to understand that the penetration of computers among people should be high enough to recoup troubles with IT in general, in other words, people should get their hands on and start using computers. So.

    Consumer sector

    Soil preparation is the introduction of a computer + network at the enterprise. This is a pioneer - system administrators. Nothing can work without them, it is trite.

    The place of IT in the consumer sector can be reduced to one keyword - accounting . That is, we provide accounting. In other words, we can take into account our processes in production and make up the raw material stock base - this is the time, and the finished product base is two. There is also a salary and staff and equipment, but this is a bonus. The main thing is products.

    In the process of accounting for production processes, we can identify:
    • Volume savings.
    • Savings on communication between people.
    • Savings on sophisticated quality control.


    The main idea is that if there are a lot of similar routine operations, then it makes sense to implement IT accounting. Otherwise, you can do without. Nothing terrible to happen. Quite the contrary. Perhaps the lack of IT will help make a business profitable, or at least a separate site.

    At the exit from the consumer sector, there will be a recorded list of the produced nomenclature (products or services). This list goes to the sellers, that is, to the financial sector.

    Financial sector

    The place of IT in the financial sector is to strive for another keyword - search . At the same time, accounting does not go anywhere. But search is the main function in capitalism. The financial business model is a vivid formula

    Деньги -> Товар -> Деньги'
    

    That is, in order to sell something that is not needed, you first need to buy something that is not needed (c)
    Actually, until the search tools appeared both by product range (hello walk) and by consumers (hello book) IT for financial business had a small a bit of significance. The basis is the communication skills of sellers in different formats of personal meetings.

    At the same time, the financial sector inherited IT accounting from the consumer sector: salary, warehouse.

    The main function of the financial sector is the search and connection of goods with the consumer. As well as the search for favorable prices, supply and demand. Moreover, both a direct search of people for goods and a reverse search when goods (through marketers) are looking for their people.

    What adds the financial sector to IT accounting? The answer is complex: its spontaneity, situationality.
    Since the sale is from person to person, proven sales practices are used. In short, the method of "teeth loose" and promise the most effective - it has always been so. Charisma and manipulation, there is charisma and manipulation. Therefore, IT specialists, trained in strict system accounting, so often grab “creative” tasks such as “redo everything”, or why we have so few orders.

    These are not salespeople (lyrics) so bad, it’s a feature they have. That is, the aura and charisma of a particular seller must be denounced in the form of a site. But that's not all. Since a good seller knows how to adapt on the fly to a client in person, he involuntarily implies that his site should do the same. Or vice versa, let the site be at least some, but when the client calls him, then he will promote it.

    Total

    The consumer sector, took its paper reporting journals and converted them into electronic form, having received significant economies of scale. Implemented a system of accounting and search for a range of goods and services.

    The financial sector is trying to take advantage of the created accounting and search infrastructure, but so far it cannot copy human situations, let alone the site. At the same time, it was possible to increase the number of points of primary information about goods + deliberate adjustment to the human search. Spam is a simple logical and understandable promotion tool.

    Knowledge: systematic or situational


    Like any complex tool, IT is associated with specialized knowledge that you can’t quickly transfer. This is a major problem for everyone. From a business perspective, this is a burden, like bookkeeping. Only worse, since IT is allowed not to be used, that is, one has to voluntarily climb into this “swamp”, and even somehow manage it.

    For the consumer sector, more or less, everything is clear. The options here are


    1. Make yourself an accounting system and actually everything. You don’t have to do anything else, sis. admin cope if the computer freezes. And it is possible without any admin at all. The option is good, but scary in terms of downtime risks.

    2. Therefore, option two is more common. Make an accounting system and leave a person to support. The problems here are. The level of the system corresponds to the level of the person who made it. As a rule, this is a novice specialist, so the convenience of the system is often lame. In addition, a person begins to get bored and wants to move on, but there are no objective tasks for growth within the company. Therefore, a trickle appears. Actually, the option turns into the worst number one option.

    3. Option three. Build an accounting system on the promoted technology (hi Bitrix) with the involvement of contractors. Actually this is the “easy” second option with an attempt to level the risks of staff turnover. The calculation is simple, there are many specialists in the market who own this technology, so we can quickly find a replacement. This option is logically good, but almost identical in comparison with the second option. Since the selected technology immediately binds the entire accounting system to itself - this is the time, and automatically lowers the requirements for the level of a person - these are two.

      A separate minus here is that, in fact, the turnover in this case only increases, since the person receives a clear growth prospect, but only within the framework of another company. Moreover, the reasoning is also transparent and logical, now I’ll study here and go where the higher pay, it’s convenient - because the technology is the same (yes, I know bitrix). That is, we grow specialists for others for free, is it not a shame?

    4. Option four. Outsource the entire IT system. That is, to increase the degree of division of labor. Actually, just as, at the time, the financial sector stood out from the consumer, as we have already seen that the nature of the financial sector is highly dependent on the skill of the seller. In the case of IT, we are also too much dependent on special skills.

      In this case, all the workflow and motivation of the IT staff falls on the contractor, who is simply obliged to conduct several projects for different customers in order to be experienced enough. The important point here is that the outsourcer must write the code specifically for you. You attach it to yourself, and it becomes attached to you. Since an outsourcer cannot sell an individual development to anyone but you, nobody needs it. Mutual linking to each other.

      In this case, the risks of downtime tend to zero, and the contractor himself begins to strive to develop and offer improvements due to the specialization in your business and the constant development of skills. Therefore, this option really solves the problem of IT accounting. What to hide, I myself work as such a contractor.


    Now let's look at the financial sector

    He got all the experience and developments of the consumer sector. Actually, the problems are also diligently inherited. In addition to the accounting system, the following were added: a) a lot of network sales points (read sites), and b) a lot of non-automated work on seo (read spam). There are attempts to automate seo, but since the very nature of sales is purely situationally charismatic, the results cannot be objectively put on stream, each time it is somewhat different.
    In addition, sellers know how you do not jump out of your pants, and the one who has the best price, he sells.

    From the point of view of a classical IT specialist, a situation of constant stress from inconsistency and unpredictability of the result. High turnover here is the norm.

    There are rare exceptions when IT specialists are predisposed to sales, but for you this will mean only one thing - you are guaranteed to get a direct competitor in your field, which will soon oust you from the market. To live with wolves, as they say, is nothing personal only business.

    Person: outsourcer or staff member?


    The answer is simple: definitely a staffer.

    • Firstly, it’s so psychologically easier. Let him not cope, let him laugh, but psychologically it’s still easier. Especially for the financial sector, where the psychological attitude comes first.

    • Secondly, it’s more clear. Not all can be discussed by mail or skype. It’s much easier to discuss ideas. Even experienced guys admit that without a personal discussion it’s practically impossible to realize a confused idea. Often you just need to talk or close the area of ​​incomprehension.

    • Thirdly, you can understand who you work with. Personal character, motivation, ambition. All this has to do with work, because people are involved in IT. Some successful managers feel their employees so much that they may not really go into IT at all. But then they have everything under control and are going according to plan. True, these are found only in the consumer sector, where the basis is systematicity, rather than situationality as among salespeople.

    • Fourth, you can always agree with a person. Nothing prevents to agree on a free schedule or parallel projects. If the work is carried out responsibly and the person suits you in spirit, then sooner or later you will come to the conclusion that your IT is organized according to the fourth option. That is, it is an outsourcing, with a trusted person who specializes specifically in your business and is always ready to be in the office in person.


    Are there any options for full outsourcing?

    There is. But they will not suit you.

    The fact is that only one category of people can take people who were initially remote (outsourced) - those who are in the subject themselves. That is, you do not have a problem with IT knowledge, and you yourself can do absolutely everything. Then you just need hands that you can use instead of yours.

    However, as soon as a little away from routine tasks, swings and misunderstandings immediately arise. The situation instantly turns into a bad one and you have to move on to an emergency-experienced activity.

    Eventually


    IT is a field of expertise. If you can organize a systematic approach to IT, and set system tasks, then if there are people at hand, everything will turn out right and the development of your accounting will go on. Situationality must be taken for granted and rely solely on luck.

    With a systematic approach, people tend to stay at one workplace longer: 2-4 years or more, you can predict that you will have a person. If you came to the natural outsourcing according to the fourth option, then consider that this site is closed for you at all, the person will remain in the team and become part of your business.

    With a situational approach, people stay for six months - a year - two maximum. The main reason is the fundamental nature of people in IT. Do not look for reasons in yourself, just immediately lay the test for the planned rotation of IT specialists. This approach is quite normal. In addition, if you are lucky, it is more likely that you will come across a person of the same situational nature. Then things will go uphill. True, if he turns out to be too good, then his business will go uphill. In any case, planned rotation cannot be avoided.

    Concluding remarks and references

    • The purpose of the article is to present the theoretical state of affairs in IT regarding the organization of an IT department and the search for employees for it, with the possibility of referring to this material as an explanation.
    • The article uses an economic view of business based on the theory of neoconomy.
    • The situation in the industry and approaches to the organization of IT, the author of the article took from personal experience, based on work in IT since 2001.
    • The organization and psychological aspects are based on the works of Shchedrovitsky P.G., and are also confirmed by the rich personal experience of the author of the article.

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