High-tech help? It's your call - hiring small business information technology experts

Nation's Business, Feb, 1996 by Christopher Robert Barton

At the end of 1992, the first year of operation for B&S Diversified Inc., the firm consisted of only four office workers and two field-based electricians. Sales at the Orlando, Fla., construction-contracting company totaled just $800,000. The last thing on the minds of owners Tanya Sims and Rose Maybin that year was hiring a full-time technology professional.

Just three years later, B&S Diversified is a $5 million company with 12 employees in the main office and 46 electricians in the field. Yet even though the corporate office has only six personal computers, Sims and Maybin plan to hire a technology pro.

"It's always been a priority to improve our computer system, but we have grown so fast it has been hard [for us] to find the time," Sims explains. Implementing technology improvements would be the full-time job of their technology employee.

Two vital departments in the company - estimating and purchasing - have only one PC each, but both soon will get additional computers for servicing current and new accounts, Maybin says. The computers will provide only a short-term solution, however, for the firms informations-access problems, she says. For the long term, the company needs to establish a server-based computer network - a job for a technology staffer. Both Sims and Maybin are well aware that network engineering and management are not tasks that can be entrusted to computer amateurs.

B&S moved in June to a larger building, and Sims and Maybin had cable installed for high-speed data communications. Initially, a consultant will use the cable to connect personal computers used by the firm's controller and three project managers. Later, the full-time technology staffer will expand the network to the rest of the firm's PCs and printers.

Reasons To Make The Move

Why hire a computer guru rather than turn to outside experts such as consultants as needed? For the owners of B&S, the source of the answer was part arithmetic, part entrepreneurial optimism, and part business experience. Says Maybin: "When you go from four to 58 employees in three years, that's rapid growth. At that rate, we could have 150 employees and 27 computers in another year or two. Logic tells you that you can't outsource forever, and we'll need to hire someone."

Moreover, says Sims, she and her partner have found that doing specialty work in-house - rather than employing subcontractors - generally saves money and improves quality.

Reasons To Hesitate

Although the decision to employ a full-time information-systems specialist was clear-cut at B&S, it can be an agonizing choice at many small companies. That's because small-business owners - many of whom are technology novices - often justifiably fear that a computer specialist would merely sit around with little to do until the company computer system crashed or until hardware or software needed upgrading every two years or so, says technology adviser Phil Anderson.

A professor of strategic management of technology at Dartmouth College's Tuck School of Business, in Hanover, N.H., Anderson generally recommends that firms outsource computer work to eliminate the risk of having to pay an occasionally idle technology employee.

However, deciding whether to hire an expert or rely on outsiders for technology support has to be based on factors specific to the individual company, according to experts such as Joseph Elmer, a software developer in Lynchburg, Va.

Complexity And importance

Elmer, who also is president of the 400-member microcomputing special-interest group of the Information Technology Association of America, a 6,000-member trade group based in Arlington, Va., says two factors in the decision making are the complexity of your computer setup and the importance of computerized data to the day-to-day operation of your business.

Suppose, for example, that your company accepts orders and receives credit-card payments by telephone; if your computer crashes, he says, even a one-hour wait for a consultant to arrive "and bring the system back up is a lot of lost revenue."

Or if you have decided it's time to integrate computer operations-connecting the accounting and inventory-control systems, for example - it's probably time to consider hiring a full-time employee to handle complex operations, Elmer says.

The Extra Benefits

Keep in mind, also, that there can be intangible benefits to having your own technology professional on board, says Christopher Young, a partner in the management advisory services group of Deloitte & Touche LLP, an accounting and business consulting firm based in Washington, D.C. For example, he says, a full-time technology expert "could save thousands in training costs for new employees ... and pinpoint specific new technology uses for your business that could save or make you untold amounts of money."

The cost of bringing such an expert on board would probably exceed $40,000 a year, says Rich Schinnell, a computer consultant and president of the Capital PC-User Group, in Rockville, Md. He says a small firm should not hire a recent college graduate at a low salary and then expect to be able to replace all the firm's outside technology contractors. "If you hire someone too cheap, they won't have the capability of working alone," Schinnell says.