How to Prioritise your IT Needs

Background

Almost every business starts small and grow to become as big as it wants or can be. Some businesses though choose to remain small or medium for certain reasons. For example, some consultancy businesses would prefer to be small to maintain their agility. Some business founders escape the bureaucracy of the corporate world and choose the freedom to be agile and peaceful.?Whether you would like to remain small or aspire to grow one day, you need to understand the implications of technology on your business.

The famous Maslow’s Hierarchy of Needs has provided a way to define IT hierarchy of needs for businesses. This is borne from the fact that a business as an organisation has a life almost like a human being. It is born, grows, have ambitions and goals and will die one day through either being sold, cease to exist, change form, merge or be acquired, etc. Although an organisation life span is on average much larger than a human being’s, it is still finite nevertheless.

Introduction

The motivation for this article is to assist small business owners to align their IT portfolio with the growth stages of their businesses. Often, business founders are people who left the corporate world or big business to establish their own entities. Usually these individuals are used to state of the art IT and a particular way of using technology in business. They often unconsciously expect the same level of sophistication for their small businesses as they usually think that this is the only way to do IT in business. Even if they acquire service providers to provide IT services, they are alarmed by the cost implications and what it takes to use IT in your business.

This article will take you through the levels in the IT hierarchy of Needs to help you align your business IT needs with the growth of your small business.?Maslow’s hierarchy of human needs consists of five levels, namely, physiological, safety and security, love and belonging, esteem and self-actualisation. These levels are juxtaposed with the Information Technology (IT) needs of an organisation as depicted in the diagram below.

The Levels of IT Priority of Needs

The pyramid below indicates IT Priorities based on Maslow’s hierarchy of needs for individuals. It covers the 5 levels of needs from basic infrastructure up to Innovation needs.?The key message from this representation is that small to medium business owners will not be able to fulfil the enterprise needs for business optimization or performance if the basic infrastructure and security needs are not met.

Below is a detailed description of each level.

Level 1: Digital Existence

The needs at this level are equivalent to Maslow’s Physiological needs including sleep, hunger, thirst, etc., without which there is no meaningful existence. Most of these are available freely or for a very low price. For example, free software for online meetings exist even without limitations on meeting durations and free website templates are offered by many web hosting providers.?Free and/or low-cost Office Application Suites are also available, such as Google Suite for you to get by. At this level the focus is on establishing your digital presence.?However, you must still ensure that you backup your data for in case your device is stolen or is broken.

Level 2: Structure and Cybersecurity

The needs at this level are equivalent to Maslow’s Physical Safety and Security needs.?The cloud provides the safety, protection, shelter and stability required by small to medium businesses.?You are sure to recover your data from the cloud storage if it’s lost from your device. But the requirement is that you should store it in the cloud.

The level of security is still defined by you as you choose the users that will have access to your cloud site and the type of authentication you want to use.?However, you cannot operate at this level without having acquired the basic needs such as devices and internet connectivity, hence this is a hierarchy of needs. See how?an example of what this could mean for a non-profit organization.

Level 3: Standardisation

The Maslow’s equivalent of this level is often referred to as “Love and Belonging”.?The IT version is about using industry standard technology in order to “belong”, i.e., to interact with customers and suppliers using what everybody regards as standard. Usually, such technology becomes a barrier to entry in a specific industry. For example, at a point in time, ATMs were a barrier to entry in the banking industry. Soon, online banking will be a standard if it isn’t yet.

The need for using similar systems that are interoperable with those used by suppliers is critical at this level. Transacting online becomes a key definition of this level. Therefore, the previous level of cybersecurity becomes a necessity for small to medium businesses to operate at this level.

Level 4: Performance

The Maslow’s equivalent of this level is described by self-esteem, status and reputation. For a business to achieve its self-esteem it must achieve its business goals. Small to medium businesses at this level are interested in using IT to achieve business goals.?

Business continuity becomes imperative to protect the business reputation.?Best practices are processes followed by successful businesses in a particular industry. Therefore, adopting best practices for using IT to achieve business goals will almost guarantee success.

Again, this level needs the business to have solidified its capability to securely transact online, which is achieved in the previous level.?

Level 5: Optimisation?

The Maslow’s equivalent of this level is self-actualization. This is where you stand out from the crowd through innovation. The IT form of this level is achieved through digital transformation, where a complete digital business model is developed and implemented.

A digital business model is one where more than two thirds of the business activities are conducted through digital technologies.?Although some companies are born in the digital world, they nevertheless require the basics defined in the previous levels.

The critical message for this level is that a new business model must be defined that is driven by digital technologies.

Using the IT Hierarchy of Needs

The level of needs for your business is largely determined by the nature of your industry. The fourth industrial revolution has affected every industry but in different ways. Some industries have been turned on their heads by the advent of new business models that are driven purely by the digital economy. For example, the advent of online audio-visual streaming platforms has led to the collapse of companies such as Blockbuster, who could not transform and adapt their business model. A great lesson here is that if your company does not adapt and change its business model in alignment to digital changes in your industry, it must just not survive. Digital technologies make life simple, convenient and cheaper for customers which makes them attracted to those companies who use these technologies in engaging customers. Therefore if digital technologies are a trend in your industry, your company needs to prioritise them to survive.

In the above example about audio-visual streaming industry, companies are forced to operate at level five of the IT Hierarchy of Needs. This implies that they need the IT technologies and infrastructure that supports a digital business model, meaning all the needs listed in the lower levels. This applies to all industries that have seen the dominance of digital platforms and products including the taxi industry (affected by e-hailing business models such as Uber, Bolt, etc.

However, for industries such as the retail industry, digital platforms are taking longer to dominate. Only a few big players such as Alibaba are using digital business models. Here the priority should be the ability to transact online, which is level 3. This includes online purchases and payments, online stores with capabilities to display images of physical products online in a manner that attracts customers. However, businesses in the retail industry must develop a digital business strategy and start a digital transformation journey as the digital trends are also growing here.

The above example shows the importance of understanding and keeping up with trends in your industry. A very useful approach to prioritising your IT needs is the MoSCoW method depicted in the diagram below. This approach helps you identify the technology capabilities that you?Must have,?Should have,?Could have or?Would have, depending on the prevailing situation in your industry.?

After gaining insight and thorough understanding on the use of digital technologies by your competitors, suppliers and customers in your industry, you will need to decide which technologies are a priority for your business. Some technologies might be of value but require high effort to implement. In such a case you will need to weight the risk of not adopting them against the effort required. These will fall in either the High-Effort/High-Value or High-Effort/Low-Value category. The HE/HV category can be postponed because the threat of competition is not immediate and you can buy yourself some time. However, as mentioned above, in such cases it is advisable to start the digital transformation journey be it at a reasonably slow pace. The HE/LV category comprises those tech nice-to-have technologies.

The Low-Effort/Low-Value category comprises those technologies that might give your company a good reputation but not a high enough value. Because these are low effort, one could adopt and implement them. Technologies in this category are those usually classified as best practice tools. Best practices are those that are likely to give you the same success as some of your best performing competitors but will not necessarily give you a competitive advantage. Having them will give your organisation a good reputation.

There are those technologies that well-spoken about and highly recommended. If you analyse their potential you will discover that they are a game changer and are therefore very likely to give a competitive edge. If your business goals is to be unique and have a competitive advantage, you should consider these technologies. However, it takes a lot of effort to implement them. As such they fall under the High-Effort/ High-Value category and you should consider them. Depending on the prevailing circumstances in your business you would not be forced to have these technologies.

Conclusion

The prioritisation can happen even within the same level. For example, tablets are tools for digital existence but may not be necessary if you have touch-screen and very light laptops. However, for sales personnel that need to access live data remotely during sales encounters, a tablet might be necessary. This shows that the digital existence needs of different organisations are not the same.

This article intends to help SMB owners understand the prerequisites for operating at any level they choose. SMBs can start at any level in their quest to adequately utilise IT in their business. The levels also help with the understanding of the expectations of what one can achieve at different levels as well as what is needed.?