5 Reasons Why Most IT Solution Providers Will Fail

This article might be a shocker for many. But after interacting with many IT solution providers and CEO’s of technology companies over the last 15+ years, I have a dim outlook for many organizations that fail to overcome these principles.

First of all let’s define failure. I am not referring to failure as going out of business, although many are going that route. I define a solution provider a failure when it fails to grow. I believe most entrepreneurs get into business to build something special, not to create an entity that generates heartache and constant pain for the owner. I have seen many organizations that have been in business for 10 or more years without considerable growth, where the owners are frustrated and about to give up. I call this the death zone for IT solution providers. It is a scary place to be.

Here are the traits I see as being the core problems to this lack of growth.

  1. Lack of Leadership Acumen
    I started my blog to help others develop greater leadership acumen and to share my thoughts. Leadership is complicated and fascinating. There are so many aspects to leadership that can derail an organization and it requires constant growth and maintenance. There are huge numbers of wonderful books that help leaders to develop themselves, but most of the Technology CEO’s I have met do not embrace a growth mentality in themselves or their employees. The technology industry needs greater leaders to step up to lead and inspire their employees to create greater success for their organizations.
  2. Lack of an Execution Structure
    This is something that I have spent well over 1,000 hours, thinking about, writing about, and consulting about. In fact I wrote a book on this execution structure that will be published this fall. It is not enough to have a fantastic goal or desire to become greater, you have to have a plan to get there. You have to inspire all your employees on this plan and exercise accountability within the organization. You need to have a goal oriented structure where performance is rewarded.
  3. Lack of an Innovation Oriented Mindset
    Many people think of innovation as creating something that no one else is doing. They think of great innovations like the iPhone. But innovation is about creating something for your organization, or your geography that helps your company produce better results. Many CEO’s get stuck in trying to find the magic bullet that someone else is doing. They may spend hours, or even days researching what other people are doing, but they do not have the discipline to sit still for 2 hours to create something innovative for their clients and their company. It is OK to model after others, but there are a lot of people in the IT industry claiming success from some method, but in reality, they are in the same boat as everyone else. If you talk to your clients and your employees, you can learn a great deal about ways to innovate that will help your company.
  4. Lack of Standardization and Formalized Processes
    Processes do not have to be complicated, nor ITIL compliant. But it is hard to create highly profitable organizations without strict efficiency. The technology industry is rampant with solutions.  It is easy for CEO’s to chase every shiny object. It is important to standardize on vendors, but it is vital to standardize and create processes on your operations. How your staff implements, manages, monitors, and maintains client systems needs to be documented, flushed out, and optimized. There are not easy short-cuts to doing this.
  5. Lack of a Sales Engine
    The world of sales and marketing is changing. Potential clients are often much hardier and picky about who they do business with. It is also getting difficult to distinguish oneself from the other IT solution providers. While much of the sales and marketing process is going online, there are still skills needed to develop close sales opportunities. Most of what you have heard out there is all wrong about sales. I highly recommend reading the book, . It puts to rest that the best sales people are the relationship oriented type that most technology companies focus on creating. It is important to focus on and create this engine that will propel your company to greater profits and success.

Please do not mistake this as a doom and gloom article. I have personally sat on the phone and been in meetings with CEO’s that were crying because of the pain and heartache of not being able to grow their organization, CEO’s that were considering closing shop and doing something else even. The industry is in a state of flux as cloud computing changes the dynamics of how we operate. It is important for leaders to recognize that there are answers out there and that they can create an entity that is successful, fulfilling, and profitable.