The nice thing about this new stream is that we can write about technology trends that are important – right now. Well, the dominating news seems to be the imploding economy. I am going to set aside my utter disdain for the fact that so many analysts and talking heads describe the current situation with phrases such as, “the worst disaster to ever effect humanity”, and, “the worst financial times to ever hit the human race.” At this point, I am hoping that Sarah Palin’s Joe Six Packs have figured out that the underlying economy is fine, and that this will become a self fulfilling prophesy if the media megaphones succeed in scaring every person within earshot into skipping Christmas this year. Getting past all that, let’s talk about technology…

Negative economic times generally have an interesting impact on technology tools because the resources dry up and organizations have less ability to take risks and buy new toys. So they replace this with learning how to use their current tools better, and figuring out how to leverage free technology tools. A simple example of this would be that small companies decide that there is no use spending $300 on Microsoft Office when they can use Google Docs for free. Another example is that instead of buying a whole new accounting system, people try to figure out how to extend the current system they have. In many cases this is a good thing because they learn that they can get a lot done with the horse they are riding instead of trading her in on the new model. Ergo, from a vendor viewpoint, there will clearly be winners and losers.

I like Google in a down market because their model is primarily free for tools, and funding that through advertising. Sure, their advertising revenues will drop, but their usage base will go up and as soon as the economy comes back, there they will sit with millions of additional users. I do not like Oracle, SAP, HP and Dell. These are easy suppliers to cut back on because they either make expensive software, or hardware that can be delayed. What about the small or medium sized business out there. How can they leverage technology in a down market…

Well, first off, be open to using free tools where you might not have earlier. There are open source applications that can be used if you will just invest some time to learn them. There are many clever marketing and advertising options that only cost your time to learn them and experiment. Every day of every week of every year at this point I see some new, free Website or online scheme that can help you find new customers or improve the relationships with current ones. Necessity is the mother of invention I suppose, but I would rather think if it as a recession is the mother of invention 😉 The next thing to do is take some of the free time you have on your hands since many of your customers are now wringing theirs, and learn how to fully utilize the software you have already purchased.

This is a great time to take a deep breath and really take the investments you have already made and leverage them. The fact is that when things are going really well, we are too distracted to fully implement software and hardware systems, so a slow down can give us extra time to go back and really figure out how to use everything we have paid for. My observation is that software like CRM systems rarely get even 50% utilized. Even network equipment can be sitting there partially implemented. We have custom reporting software, but do not spend the time to really build all the custom reports or dashboards that we need. We have website content management systems that let us have complete control over our sites, but we don’t update them nearly as often as we should. My metaphor is that a soldier uses peacetime to clean the guns and do some target practice so that when the battle starts, they are fully prepared. The same is true for this downturn. Now is the time to evaluate all the technology you use, and invest time in learning how to fully leverage it. Then take the next step and figure out what free technology exists that you could be using. Then when the smoke clears and the economy rises like a phoenix, you will be prepared to leapfrog your competitors.

Hidden in this is a message that it is not wise to fire all your IT people in a downturn. Although they may not appear to be revenue generators directly, they are often the people that can assure you can generate that revenue in the future.

Scott Klososky
Scott@klososky.com