Information technology (IT) departments in companies that are not primarily technology focused, like those in the ski industry, typically have a difficult time explaining their needs and obtaining funding from a non-technical audience (i.e., the boss). Management will oftentimes struggle to make sense of the techno-speak in requests from IT, making it difficult to prioritize the needs of IT with the rest of the business. It’s like the two groups speak different languages.
That doesn’t need to be the case, though. “IT managers and spending decision-makers need an Esperanto, or common language, that allows the two sides to agree on priorities and funding,” says former Peak Resorts vice president of IT Mike Chase. “Framing IT needs in terms of either potential cost savings or revenue enhancement puts IT requests on equal footing with the needs of most other departments.”
Make a Business Case
While not all IT projects are easily expressed in simple financial terms, you can usually get a sense of the potential impact to the business.
The cost of security. For example, replacing or upgrading computers to eliminate Windows 7 due to its end of life support earlier this year may not appear to have an easy ROI. However, when you break down the reasons why you need to replace Windows 7—it is no longer receiving critical security updates—you can look at this as a risk mitigation against a potential data breach. With the average data breach costing businesses an average of $200,000, you can build a business case.
Staffing and older equipment. Every department would love more staff, of course. And newer gear. It’s possible, though, that purchasing new gear will help solve a staffing shortfall. Former Mount Snow, Vt., IT director Dave Muenkel uses a snowmaking analogy to make the case.
“Let’s say your resort has old, rusty snowmaking pipe that is in constant need of repair. You need enough welding staff to continually fix that infrastructure in order to continue with snowmaking operations,” says Muenkel. “Without enough welding staff, repairs can’t be made fast enough, so snowmaking productivity and efficiency declines, costs rise, and the product suffers.”
A resort’s inventory of PCs is similar, he says. There are industry standards for how long a PC should work before it’s replaced—about every 3 to 6 years—but a lot of ski areas stretch the life of their PCs. “So those computers are essentially that old snowmaking pipe that you constantly need to keep fixing. It reduces productivity of the end user, and it takes valuable IT staff a lot of time to maintain the older equipment,” says Muenkel.
More staff is needed for this constant maintenance and repair in order to avoid business interruption. By replacing computers in the suggested intervals, though, “there’s typically less on the IT person’s plate, so maybe that solves the staffing problem,” he says.
Network switches. Does resort leadership know what a network switch is or what it does? The $2,000 to $5,000 price tag for one will likely require some explanation when IT asks to buy some. As it is with most things, you get what you pay for—the more expensive switches are better and last longer, but how do you justify the investment in better switches?
Consider your resort’s busiest bar/restaurant on a holiday Saturday. Some of these joints ring up thousands of dollars in sales every hour. If the switch connecting that restaurant’s points of sale to the resort’s network fails, the POS functionality goes to zero—credit cards can’t be processed, tickets don’t get to the kitchen, etc.
“So, even if IT is able to get a new switch configured and up and running in, say, an hour—which would be really fast—how much business is potentially lost?” he says. That sum could be more than the difference between a less expensive network switch and a rock-solid switch that costs twice as much.
Nobody is going to order an extra beer because the bar has a fancy network switch and POS system, of course. However, investing in these systems allows your bar to reliably take people’s money, and you are able to service the guest promptly. If you keep people waiting when they’re trying to give you money, there’s a threshold at which they’ll just walk away. Don’t let that happen.
Map Out a Plan
Regular funding and a 3- to 5-year IT plan will help both IT and the overall business minimize unplanned expenses. IT should build a plan that can remain flexible to varied business conditions, whether it’s a poor snow year or a pandemic. Prioritizing equipment replacement based on its revenue potential aligns IT even closer to the business, as the previous examples illustrate.
Muenkel suggests compiling a portfolio of equipment—computers, switches, servers, battery backups—in which each piece has a defined lifespan. This allows for advance capital planning, as it’s easier for leadership to see what will be needed and when.
It also allows for flexibility. For example, if 20 computers are going to reach the end of their suggested lifespan three years from now, that could be a big capital hit to happen all at once. But if you plan to replace some in three years and extend the rest another year beyond that before replacing them, it spreads out the capital need.
The key is developing the plan and communicating it to leadership. Muenkel says the hard part is doing the inventory. Once the inventory is complete, the rest is simple math.
“Let’s say I want my laptops to last five years and desktops to last seven years. When you get new equipment, you know to include the replacement of that equipment in your plan five and seven years down the road,” he says.
The Overall Approach
In general, IT managers would benefit from approaching funding requests by first asking, “What is the business need that this solution fits into?” Once that is determined, the request will be more palatable to leadership.
In many cases, too, there will be an ROI for the capital request. IT managers should do this math ahead of time, says Jay Peak and Burke Mountain IT director Craig Russell. “When I need big investments, I never lead with the number,” he says. “I try to get to that after I’ve convinced management that this is the right course of action and explained the ROI in real terms. Then drop the number.”
Since most budget processes involve filling numbers in a spreadsheet and submitting it without much space for the “why,” Russell says it’s important to have a conversation before turning in the request. “This approach absolutely involves reaching out and engaging your leadership so that 1) they are aware the number is coming, and 2) they know you’ve already put in the work preparing them for how it will benefit the business and what the payback is.”
For ski resorts, IT matters in a variety of ways—from having good wi-fi to give guests fast internet access to enabling advertising on TVs or counting the number of people on the slopes. But, ultimately, there’s a lot that IT can do to provide more information and more usability for staff, more of a fun environment for customers, and also collect more data for the business side of things.
If the business side can set a solid IT foundation, it could realize greater revenue opportunities for IT in the future, instead of perhaps seeing it as just a line item cost for upgrading old equipment. In other words, IT can be so much more than just maintenance and repair. It can be a source of income. It pays to harness that potential.