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In our eleventh series Linda Pearson talks to Dermot
Dolan of technical-ideas.com, about their business’
crux at present.
| VITAL STATISTICS |
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| Emmet Gilhooley - Head of I.T. Support,
Colin O’Connor - Lead Developer, and Brendan O’Connor
Head of Development Department |
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Business Name:
Technical Ideas.com
Year of Set Up:
2004
Founders:
Dermot Dolan/
Brendan O’Connor
Location:
Sligo
Business Type:
Software Development
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My company, Technical Ideas.com, develops and markets healthcare software
applications to healthcare professionals. Their main product is called
‘Socrates’ which is a GP practice management system as well
as primary care teams.
BACKGROUND
Socrates was developed in collaboration between a number of general practitioners
working in general practice and young software developers straight out
of college. We worked in a unique environment exchanging expert advice
between the two parties during the development of Socrates. We believe
having this expert level of advice allowed us to tailor the software to
the exact needs of the target audience.
CURRENT STATUS
Socrates was released commercially in 2005 after 13 months of development
and testing. Eighteen months later, we are now approaching 100 sites nationally
with our customer base covering a geographic area from Donegal to Cork.
We believe the excellent sale that Socrates is generating is due to one
factor alone, the ‘user interface’. Now this term is foreign
to many people but it means how the software looks and acts and how easy
it is for a person just to pick up the software and do their day to day
work. This is backed by a system that ‘just works’, meaning
it sits on a rock solid architecture which runs all the time.
FINANCING
To initially finance Socrates, the GP’s who were involved in the
development process got involved financially by funding the development
process.
The plan was to phase the company financing in a three stage process
which was product development, introductory marketing, and full phase
marketing. We believed these three phases were essential as firstly, the
most important aspect of the company is the product. There was no point
investing huge amounts of money if the product was not the product we
believed it should be. In other words, we had a vision of how ‘Socrates’
should work and felt that only when the product lived up to our expectations
would we start our marketing campaign. In all fairness, this was a realistic
belief because in today’s IT world products are built from hype and
often never reach the hype levels built by their marketing campaigns.
EXPANSION
Since the company formed in 2004, we have expanded at an amazing speed.
We are approaching our 100th live customer nationally with eight full
time and four part time employees. We have moved to new offices in the
Business Innovation Centre on the campus of the Institute of Technology
Sligo while having another branch office in Athlone to offer national
access to our customers. During the summer of 2005 we signed a strategic
hardware partnership with Jones Business Systems to work as an agent of
Socrates covering a ten county plus area of the country. Some of our goals
in 2007 include expanding the Socrates product to cover many other healthcare
sectors including occupational health and nursing homes. We also aim to
expand our range of technology support moving from the PC/ Laptop down
to portable devices such as pocket PC’s.
CRUX OF THE MATTER
The crux of the matter for our business is simply the technology. Socrates
is developed with the latest development tools worldwide offering a huge
technologically lead over our competitors, but more importantly, as the
technologies change we will adapt quickly and ensure we are at the forefront
of development to maintain our market lead.
QUESTIONS FROM DONAL AND O'CONNOR TO THE PANEL
- How should Irish software house approach marketing its product
abroad?
- How do you manage exponential company growth?
- What are good ways to market new software products in Ireland
today?
Kevin Sheehan, Partner, SME Services, Deloitte, heads up the panel
of experts below who give their advice on how best technical-ideas.com
can grow its business.
| MANAGING EXPONENTIAL GROWTH |
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| Kevin Sheehan, Partner, SME Services, Deloitte. |
Dermot and Brendan have developed a successful software application
with an obvious and defined market. The challenge now is to develop
a business model to support the product. If Socrates is to be successful,
it will need to be re-invented and developed at the same pace as
the rate of change in the global software environment. This continuous
development will be expensive, as will the company’s ambitious
marketing plans.
Strategic Planning
This company needs a strategic and financial plan covering at least
the next five years. The plan should include strategic goals supported
by defined steps to achieve them. The plan should incorporate budgets
and projections. Cash is the lifeblood of every business, and realistic
growth assumptions should be determined, which predict sales revenues
and cashflows. Costs should be budgeted which include all direct
costs, salaries, overheads, but also discretionary costs such as
marketing and promotion.
Financial Capital
The financial projections will determine the capital requirements
of the business. They need to consider what the optimum financing
for the business will be – probably a mixture of debt and equity,
and the timing of capital needs. Although external factors are uncontrollable,
as far as possible, once the plan and the budgets are set, stick
to them!
Kevin Sheehan, Partner, SME Services, Deloitte.
Head of Panel for Crux of The Matter.
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| Brian O’Kane, Managing Director, OAKTREE
Press |
The way to market new software is the way Technical Ideas started
out, building something that people want, like to use, find easy
to use, and works all the time every time.
Masterstroke
Technical Idea’s involvement of GPs in the development of
the Socrates product was a masterstroke, in retrospect, an obvious
thing to do but one that is rarely done. Now they have a product
with market acceptance, it’s time to stop being techies and
to sell. How many of Technical Idea’s employees are salespeople?
Sales
The company has not sat down to think about why a GP would consider
changing over to Socrates, and what they need to do to make it happen.
Early sales have come easily but the next level of sales will come
with more difficulty.
Solution
Focus on selling what you have, not on developing new stuff. Despite
the technological leap that Socrates represents over its competitors,
it’s unlikely that existing users bought it for its technological
excellence; they bought Socrates because it did what they wanted.
In terms of managing growth, keep things simple and focus on sales.
Brian O’Kane, Managing Director, OAKTREE Press
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| Adrian Moynihan, Business Strategy, AIB |
Ireland is a relatively small domestic market and failure to access
international markets may restrict a business in reaching its full
potential. Successfully accessing export markets and marketing your
product abroad can be difficult however.
Exporting
Technical Ideas.com should develop a comprehensive business plan
before entering markets abroad. I would also recommend engaging
experts in this area, such as Enterprise Ireland, who will offer
advice and assistance to help Technical Ideas.com evaluate and enter
export markets, assess finance options, and formulate an overall
export marketing strategy.
Financing Growth
Strong business growth, while a good thing, can also place considerable
pressures on a businesses financial health. For example, if sales
increase, as well as the business cost base growing, it can also
lead to higher levels of cash being tied up in debtors. This can
often mean that sales levels can exceed the cash coming in, which
can damage the business cashflow situation.
Expansion
Technical Ideas.com need to plan and regularly monitor their financial
position. They also need to pay particular attention to the business’s
cashflow situation during this expansion phase.
Adrian Moynihan, Business Strategy, AIB
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| Mark Fielding, Chief Executive, ISME |
Dermot and Brendan must remember that professionals, no matter
what type, have discovered that IT was not the magic wand they had
been led to believe and that misapplying it can lead to wasted time,
resources and disastrous business results.
Baby Steps
Therefore taking the initial marketing baby steps was an essential
and proper strategy, which will stand to them when they market the
product abroad.
Customer Creation
The market now has a much more realistic expectation of the role
of IT and Technical Ideas must focus on customer and value creation
allowing clients to make effective use of Socrates, making technology
their servant and not their master.
Mark Fielding, Chief Executive, ISME
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| Mary Ryan, Assistant Director, WESTBIC |
Technical Ideas.com adopted the correct approach when they concentrated
on developing Socrates so that its ‘user interface’ has
become widely accepted as a leading GP Practice Management System.
In order to maximise its potential they need to focus resources
on intensive and direct marketing both indigenously and in overseas
markets.
Expansion
The strongest recommendation for the business when expanding into
overseas markets is to undertake in-depth research on select markets
in conjunction with the Enterprise Ireland office/representative
in that market. They have the knowledge and access to contacts which
will fast-track entry to overseas markets. It may also be advisable
to have Socrates championed by a recognised figure/ GP in select
overseas markets and to use the experience gained in Ireland of
working with reputable agents abroad.
Growth
Managing exponential company growth requires an effective management
support system and systems that will effectively manage finance
and customer support expansion. One of the key determinants of successful
company growth also requires access to sufficient finance to resource
growth strategies.
Management also need to keep a close eye on margins during this
sensitive time of development.
Mary Ryan, Assistant Director, WESTBIC
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