Regional small and medium business in IT

The next “interesting time” made us remember our own experience and reflect on the fate of the regional small and medium-sized IT business, and think about how the community of everyone concerned with optimization and implementation of business process models and the development of appropriate software can help.

The path that has passed the small and medium-sized IT business over the past 25-30 years has proven to be long and thorny, and the quality of business processes and the well-being of business often leaves much to be desired.
It would be desirable that in the event of any tectonic shifts the business did not fall back 25-30 years ago, and that the movement would continue.

With this publication I will begin a series of articles on this topic with the search for solutions.
Consider the history and current state of the business associated with information technology, for example, the following groups:

1. Quite young companies founded in the late 90s - mid-00s and engaged in the development of information systems for the federal and international markets.

Subject areas are completely different - e-commerce, electronic document management, mobile and web applications, energy and housing and utilities, manufacturing, logistics, warehouse, multi-agent systems, and even the space industry.

One part of the companies is engaged in the development of outsourcing, the other - has its own projects.
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Outsourcing is a separate conversation, but in the second case, the company, as a rule, has one or several technological platforms (frameworks) already developed, on the basis of which custom-made development is carried out.

The advantage (at first glance) of such an approach is the fairly rapid adaptation of existing projects for new customers with our own resources. However, in practice, this means that each of the projects has several “branches” (for each of the customers). Several “branches” within one project are difficult and expensive to synchronize with each other, support, and develop. Companies are trying several times to “merge” branches into one, then they have to divide the project again, and so on.

And after all, it’s not just about the extra labor costs of developers (programmers), but above all - project managers (hereinafter RP) and analysts.

RP and analysts spray power between project branches instead of once collecting and summarizing the source data, and then setting the task to develop a single domain model and a single functional that would be parametrically customized for specific customers.

As a result, due to lack of time and effort, analysts can draw up the results of their work not with the help of certain notations, but with the help of a text editor, inserting into them the types of screen forms, the simplest flowcharts and text descriptions (and later correlates with program code and database schema).

As a rule, the life cycle of one such project is about three years, after which the existing models (analytics results) and the developed technological platform come to a standstill, for reasons of non-optimal project management (see above) and non-optimal team structure.

An example of errors in the team structure: duplication of functions, conflicts of interest, omissions of necessary links (for example, the absence of a database architect).

Top management can largely replace a project team: the top management who oversaw the project, project managers, analysts, software architects, and databases.

After this, work on the project (projects) begins anew, with a new team: new problem statement, analytics, technological platform and, possibly, even a programming language.

However, often in the management of projects and the organization of the team the same mistakes remain, after which the story is repeated with a high degree of probability.

According to some estimates, the throwing between the “branches” within each of the projects exceeds the costs required to develop each of the projects in the form of a boxed solution:

• one project - one “branch”;
• one project - is configured parametrically for each of the customers, this does not require analysts from the development team and the developers themselves, the dealers with their own staff of analysts and implementers can be involved in setting up;
• several related projects - packaged solutions in the “portfolio” of a company can cover one large subject area.

2. Quite mature companies, since the late 80s - early 90s. involved in the development of information-measuring systems, communication systems, telecommunications, the development of software

2.1. Former defense and industry research institutes and design bureaus involved, for example, in the development of information and measurement systems (software and hardware systems and communications equipment) and related software for the oil and gas industry (production and transport). This is a “petty mother” by the standards of their golden pores of the 70-80s, when they were engaged, for example, in very large communications projects in the defense theme.

They have a name and contacts that are significant for customers and government agencies, a margin of strength based on personnel and standards of the Soviet military industry (lost over time), access to administrative resources, work at the federal level from the regions. Something rests on the surviving "red directors" who came to power in the late 80s in the wake of the election of managers of labor collectives.

Often characterized by corruption and voluntaristic decisions, inflexible behavior in a market economy, the lack of modern business and production processes, unjustifiably long adoption of objectively necessary organizational and technical decisions (or non-acceptance at all).

2.2. Small businesses founded by representatives of the above structures or people who collaborated with them at one time, dealing with the same issues, and more effectively.

Compared with the first group, tasks are usually solved ahead of the curve (including reaching the federal level, with the prospect of expansion into the near abroad), with the use of more advanced technical solutions.

This is possible thanks to a more modern thinking of managers, better personnel who have flowed from the first group, mobility, a simple organizational structure, and the absence of bureaucratic delays in decision making.
In a budget-oriented environment of near-state and natural monopolies and access to administrative resources to a lesser extent, such companies have low development potential, if a company does not at some point enter under the “roof” of a large structure as a unit (however, this option is fraught with a loss of company identity and related benefits).

Companies may not have prescribed internal business processes - at first a small enterprise copes without them, and as it grows, it continues to work “as it happened”.

In some cases, managers can stop the company's development strategy and try to freeze the situation “as is” and extract only profit, which contradicts the well-known truth “You need to run as fast just to stay in place, but to get somewhere, you must run at least twice as fast! ”with the onset of the corresponding consequences sooner or later.

2.3. Separately, we can mention the medium-sized business (long ago turned into a large one), also founded by representatives of the first group, with the administrative resources obtained with the help of directors - old appointees, and not young elected shoots of the late 80s. The founders of such a business are more proactive and successful - and they started earlier, and they took up not a new topic already known for their previous work, but new trends, the promise of which few people are able to “see” in advance.

One example of such a business is probably a well-known interregional telecommunications company.
Such companies may have difficulties in development due to their local roots and relevant business thinking, and strong pressure from the players from the initial federal level.

Accordingly, such companies also need to streamline business and organizational processes to reduce costs and increase growth potential.

In the next publication, we will look at a generalized description of IT business, identifying strengths and weaknesses in companies' business processes, with suggestions for optimizing using appropriate business intelligence and, possibly, specialized software products.