As a business owner, you probably don’t spend a lot of time thinking about binary bits, but you must access binary bits in an organized way in order to run your business. This is where the database comes in.

Likely, you’re already using at least one database in your business. This is a tool that allows you to organize and manipulate large amounts of data for just about anything — including simple applications like expense reports and customer lists.

A database is made up of (at minimum) a method for entering or editing data, a data storage mechanism and a report generator, according to Beth Cohen, president of Luth Computer Specialists Inc. You probably require an address book or sales automation tool, but don’t try to reinvent the wheel. There are literally hundreds of products available for purchase.

And you probably can’t afford to spend time and money developing too much customized software, so you’re best off looking for a product that provides most of the functionality you require right away.

Even a spreadsheet can be considered a generalized form of a database. “(Microsoft) Excel has built in a database function. It’s a lousy database, but you can actually get it to work,” says Cohen. “For a small business that has a very minimal need for a specialized database, use Excel.”

For others, your requirements will depend on the size and number of records you have, as well as the complexity of these records. A database is essentially a set of records, each with a set of fields. The beauty of a database is you can organize this information in different ways, based on different criteria.

But it’s only as valuable as the data is accurate, so understand your requirements. What is your database’s purpose? The only reason to invest in a database is to solve a problem.

Don’t make the mistake of buying beyond the scope of your business requirements. This will result in unnecessary costs. And don’t fall into the trap of developing a highly customized application if it’s not required.

“Ninety-nine per cent of the time somebody else has thought of the problem or solved it,” says Cohen. On the other hand, try to avoid “freebie” products that will come with minimal or no vendor support.

It’s important to assess what abilities your people have in-house to manage a database server, says Chris Kleisath, senior director of engineering with Sybase’s iAnywhere. Don’t be swayed by high-powered marketing, since many products require a dedicated IT staff. If you don’t have one, look for an out-of-the-box solution that doesn’t require constant monitoring.

Data needs change over time, so choose a product that gives you flexibility into the future. Consider a product that has an open architecture and runs on multiple platforms. Perhaps you’re a Microsoft customer, for example, but want the option of installing Linux down the road.

You can always talk to your trusted advisor, says Steve Hilton, senior analyst of small and medium business strategies with the Yankee Group. A reseller or consultant may have a better understanding of how your requirements will change over time and can help you figure out how specific databases will grow — or shrink — to meet them.

SMBs have a hard time predicting future needs. “It’s very hard to think out past six or nine months,” he says, “and many technology solutions are going to be with you a lot longer than that.”

Talk to other small business owners, not only about their selection process, but what they learned through that process. Ask them what mistakes they made along the way.

And seek out multiple vendors to give you different perspectives, says Hilton — the more the better. Implementing a database is no easy feat, and being prepared is your best defence against the many unknowns you’re sure to face along the way.

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