Over the last month, I've been writing about how  small businesses can leverage technology strategically: with a long term plan that will reduce expenses, contain expenses, generate revenue, or differentiate it from it's competitors.

When applied strategically, that's when tech spending yields real value, where it's doing something for the business that's meaningful to carrying out its business plan.

Today, I will speak to growth and strategic alliances with tech spending.

Who Do You Chose To Do Business With

This is easily illustrated by looking at your own direct and indirect business alliances.

A good example of a direct alliance is a relationship you may have with a vendor or manufacturer - you may resell their products or services as a part of doing business with your own customer. In this way you've aligned your fate with theirs: you are directly representing your confidence in their products and services, and betting they'll still be around tomorrow to service you and your clients. Where you go, they go. They're essential to the delivery of your business; you represent them in some way. Examples:

1. You are a Volkswagon mechanic. You depend on Volkswagon.  Without Volkswagon, it'd be difficult for you to be a mechanic unless you retooled and aligned yourself with another car manufacturer.

2. You are a jewelry retailer. You depend on the jewelers whose products you resell.  Without the jeweler, their expertise, and unique style, you'd have nothing to sell.

3. You are an Avon rep. You depend on Avon. You rely on Avon and their reputation and product line to conduct your business. No Avon, no business.

4. You are a Verizon reseller. You depend on Verizon to offer unique products and services that attract customers. If Verizon fails, you'd have to switch your strategic alliances. 

5. You are a JambaJuice Franchisee. As JambaJuice goes, so do you. 

Meanwhile an indirect relationship exists when you select a vendor to help you execute your business plan. This could be your accountant, your web services guy, your marketing person, your IT consultant. These are relationships that you've created to support your business. You do business with these people because you trust them and their judgement to help you do your work.

Who Do You Want To Be Today? 

With formal alliances, you're betting the farm on the innovation, expertise, marketing prowess, and wherewithal of that relationship to help carry your business.

With informal alliances, you're betting that your providers can help you execute your business plan with the least possible risk, the highest possible capability, at the lowest possible cost.

So who do you want to be, and, how do you want your brand perceived by having both direct and indirect strategic alignments? Ask yourself:

1. Do I want to be perceived as representing a slow, stogy, inflexible product or service?  do I want to be directly aligned with a brand that doesn't reflect my values?

2. Do I want to pay for an accounting relationship that slows my business down and limits my operational choices? Do I want an indirect alignment with an accountant that makes it harder for you todo business than your competitors?

3. Do I want to sign up for a document management service called HappyFiles.com to manage my critical business documents? Even though you've never heard of this brand and know nothing of its capability to execute its business model?

4. Do I want to invest in technology based on the way that things were done ten years ago, or embrace technology that will be deployed ten years from now? 

5. Do I want to invest in marketing practices that existed ten years ago (print, television, radio, phone books) at the exclusion of new media (search engines, social media, web video)?

6. Do I want to invest in HR strategies that don't reflect the newest trends or regulatory obligations in the field of human resource management? Would you be comfortable aligning yourself with someone who understand the "old" workforce, and not the "new, emergent" workforce?

7. Do you allow a local bookkeeper, Sandy, to do your payroll and she cuts manual checks every two weeks? Or, do you shift that to a payroll service provider that offers checks, EFT's, ACH deposits and transfers, debit card processing, automated 1099 and w2 filings, and a web portal for your employees to investigate their payroll questions? Do you want your employees to have to take time to contact Sandy, or, just get the question answered from someone else faster? 

Who do you want to be? Think about it. In the examples above:

1. How does your investment in Sandy the bookkeeper reflect your values? Your brand? Your ability to attract and retain employees?

2. If you're not embracing social media and not listening to the customer via those channels, aren't you ignoring an ever-increasing market segment? Isn't the customer expecting you to do more than appear in a phone book? 

3. If you aren't embracing modern HR policies, are you at legal risk? Or in the least a competitive risk for retaining and employing others? 

4. If you invest in ten year old approaches to technology problems, in another ten years, won't you be further behind the times, twice as slow, and that process cost twice as much than more modern approaches? 

5. If you invest in no-name services, are you shocked to see them fold in three years, taking your documents with them?

6. If you employ an accountant that needs you to transfer a file to them so they can see your financials, yet, your competitor can see them anywhere on a tablet computer, isn't that a disadvantage? Like, your competitor can make a decision or apply for a loan in seconds ... You? It'll take you days, weeks?

This is strategic alignment. You get to choose how to align your business Adams it's spending directly and indirectly to others. It's another way that tech strategy influences your ability to carry off your business plan. 

R