This is the sixth article in our ‘Best practice for SMEs’ series, designed to ensure that you, and your business operations, are at the top of your game throughout the year. No matter which industry you’re in, we’ll help equip you and your team with the resources and information to help you thrive.
A business’ infrastructure underpins the functions which are essential to day-to-day operations. While complexity and system requirements change as a business grows, the need for effective infrastructure exists in businesses of all sizes. As soon as the business has multiple employees, customers and other stakeholders, owners should be considering their infrastructure requirements.
Infrastructure traditionally refers to physical assets, such as equipment, computers and plant, but it also includes the technology stack employed to support essential business functions, including: Financial management, human resources (HR), payroll, customer relationship management (CRM) and document management systems – and consideration of how these systems link to and integrate with one another, while meeting any compliance requirements.
As we accumulate and rely on ever-increasing amounts of data, these technology infrastructure considerations become more and more important to businesses of all sizes.
Infrastructure best practices involve a clear understanding of the business needs and goals, alignment with strategic planning, budgeting & forecasting and governance processes, and effective change management.
Why is infrastructure important to SMEs?
While most business owners and operators have an understanding of the need for infrastructure, the importance of these assets and systems is sometimes underestimated – with inadequacies showing during times of fast growth (scalability of infrastructure), via due diligence during a transaction process, or as the result of an external audit or review.
By adopting a best practice approach early, businesses can ensure that infrastructure is fit for purpose, compliant and scalable – with key benefits and outcomes including:
- Employee experience: The right infrastructure, implemented and integrated well, enables employees across all functions of the business to perform their jobs effectively, know that they’re following the correct processes and have the confidence of knowing there are internal and external controls in place
- Risk management and mitigation: Particularly in regards to reducing the business’ fraud risk profile and mitigating any potential consequences of human error, as well as minimising compliance risk and exposure
- Management oversight and visibility: Implementing the right systems, in the right way, can deliver increased insights and information for management, giving greater oversight on business functions and performance
- Transaction readiness: Having the right systems in place will benefit the business if and when the decision is made to seek external investment, raise capital, enter a sales process or undertake an initial public offering (IPO)
- Scalability: A best practice approach to infrastructure will enable the scalability of business systems and processes in line with future growth.
What are the key infrastructure issues and considerations for SMEs?
Businesses which take a best practice approach to their infrastructure share several characteristics, but perhaps the most important of these is an understanding that effective leadership – whether from the CEO, Board or Project Lead – makes the difference between success and failure.
Another hallmark is the willingness to engage with the relevant internal or external expertise – enhancing your own knowledge bank and skillset with those of others is key to success.
In implementing a best practice approach to infrastructure, business owners and operators should consider the following:
Building resilience into the business model
Establishing infrastructure isn’t just a matter of buying systems and flicking a switch – it’s important to provide the appropriate level of resourcing, and a mandate for effective implementation. In particular, businesses which later experience fast growth will benefit from the resilience that results from adequate resourcing.
Understanding and planning costs
A thorough but flexible approach to cost considerations throughout the infrastructure life cycle will reduce the chances of unexpected surprises and allow resources to be allocated as and where required. Some costs are upfront, while others are ongoing. In either case, decision makers should weigh the benefits to the business against the immediate and ongoing costs and be prepared to invest for future outcomes and success.
Building cyber resilience
The most effective control against a data breach or cyber-attack is an educated employee. Without regular cyber security training and awareness, expenditure on infrastructure and technical protective controls may be unravelled by human error. Clicking on the wrong link, inserting a 'rogue device' or accidentally disclosing information can lead to a costly security incident.
Implementing regular cyber security training for all those who access the business’ systems or information will help ensure employees and contractors are made aware of their security responsibilities and duties. This training will also improve staff responses to attempted attacks – thereby strengthening the business's cyber defences.
Protecting data
There are many ways to protect your business’ data, but resilient and regular backups are your best friend. A well-executed backup process ensures that there is continued availability and integrity of information, and the capability to recover from compromises or interruptions to information systems. In the event of a ransomware attack or other system failure, you’ll be glad of recent backups which are free of corruption and easily transferable.
Moving to the Cloud
With businesses and individuals rapidly moving to ‘the cloud’, it’s important to understand that it is not a mysterious, impenetrable system. Rather, the cloud is a hosting mechanism via an external computer. Whether it be AWS, Microsoft or another hosting provider, all the same data sovereignty, regulatory requirements and security concerns still exist – in addition to some cloud-specific issues.
We recommend that businesses implement extensive third party assessment processes, which test and assess their security management controls – including hosting locations, breach notification procedures and data retention processes. Once approved for use by the business, this third party should undergo regular check-ins to ensure that the outlined expectations are being followed.
Rightsizing the organisation
It’s important to consider the infrastructure that’s going to sit behind the business not only today, but into the future. Current requirements are important, but infrastructure decisions which don’t factor in future requirements will quickly become redundant.
Outsourcing services
Depending on the size and existing capabilities of a business, outsourcing some or all of the infrastructure process may result in best practice outcomes. There are two key functions which a business might consider outsourcing, those being implementation and ongoing maintenance or servicing.
In both cases, the benefits and considerations of outsourcing are similar:
- Ensure you have internal engagement and investment – with the relevant internal stakeholders involved in the outsourcing process. Not doing so is a recipe for failure.
- Outsourcing can provide a level of expertise and resourcing that the business may not otherwise be able to access or afford
- Generally, outsourcing services will give you access to a multi-level team – not just a single resource – making it a cost-effective way of access specialist expertise
- Outsourcing can provide a level of risk mitigation and additional layers of governance and accountability.
Change management and employee engagement
Any implementation – whether technology, a new process or equipment – involves change. The success or otherwise of a business’ approach to infrastructure implementation hinges on effective change management and employee engagement. As the most important resource in a business, it’s vital that people are well supported and brought along at every stage of the process.
Projects can easily lose focus, definition and reasoning when change management isn’t done well – which in turn may lead to a lack of appropriate resourcing.
A best practice approach to infrastructure
While every business is unique, with variations in size and requirements, there are common steps that should be taken in a best practice approach to infrastructure:
- Define the infrastructure needs of the business and the desired outcomes: Time and thought at this step can ensure you don’t end up with the wrong product/s and a potentially wasted exercise
- Engage with the right expertise: Whether internal, external or a mixture of both – make sure you have the best available advice from those with the required knowledge and experience
- Map out your cost options and scenarios: Ensure these are built into business modelling and factored into your budgeting and forecasting
- Engage with key stakeholders and ensure they’re kept across the process: This might include management, the board, employees, or business advisers
- Implementation: Whether outsourced or in-house, this step must be well planned and factor in the change management considerations discussed above
- Monitoring and review: Ensure infrastructure is factored into the business model and ongoing commercial operations – with a willingness to assess, adjust and re-visit infrastructure as business requirements or technology changes
- Appraisal: Provide an ongoing post-implementation feedback channel, actioning as appropriate.
Business owners and leadership can help ensure the best possible infrastructure support for essential functions by following these steps. Taking a best practice approach not only increases the likelihood of a successful functional outcome, but underpins the future scalability of the business and supports growth.
Our team of experts has the range and depth of experience to support your business – whatever your goals may be. Get in touch for more information on taking a best practice approach to infrastructure or to discuss your business needs.
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