Not-for-profit ICT and management consultancy 

It was a strange phone call. “If you call this number in the states,” my friend said, “they will send you $5000 to work up a business plan for a telecottage in east Belfast.” I said OK and hung up. I didn’t even know what a telecottage was, but I was sure east Belfast could do with one!

This was how Sammy Douglas, former chairman of the East Belfast Partnership, remembers the start of Avec Solutions, or as it was then known, ECOM Management.

A group in west Belfast, with support from a donor in the US, had put together a proposal to Belfast City Council to fund a telecottage project, but such were the politics in Belfast in the mid-90s that funding was unlikely to be granted unless there was a ‘matching’ grant for a project in the ‘other community’. As a result of this process, a grant of almost £60,000 was duly received to establish an east Belfast telecottage which would provide IT information and support to local businesses and groups.

It may be hard to believe now, but in the mid-90s in Belfast email and the internet were rarely found in your average office and the initial idea was for the telecottage to provide an email service with local businesses and groups then calling in to collect a printout of their message – the hope was it would impress others!

Thankfully, those involved in East Belfast Partnership who were tasked with setting up the telecottage could see that rapid change was on the way and decided, in conjunction with the council, that the best way to provide IT support to local groups and businesses, as well as making the activity sustainable in the long term, was to establish the project as an ICT consultancy, and so ECOM Management was born.

The new initiative was launched by Sir Reg Empey, chair of the city council development committee (and a future minister for the economy) in February 1999, although for various reasons at the time of launch the business had no staff. Richard Rea, a self-employed IT consultant who had helped us set up the business, had by this stage moved on.

However, soon afterwards the current managing consultant, Geoffrey Ready, was appointed as ECOM’s first full time IT consultant. There were of course no clients but Geoffrey’s first task was to set up the new Microsoft server based network for the parent company, the East Belfast Partnership, leading to our first invoice (even the parent company can’t have work done for nothing!).

An IT suite had been set up, with various hardware and software installed, and this was then opened on a ‘drop in’ basis to show those interested what was possible. Alongside this facility Geoffrey also began a series of free seminars on various ICT related topics, which proved very popular.

However, the company was aware that a grant of £60,000 would not last long, as about half of this was used for setup costs, and it set itself the task of breaking even by the end of the first year.

The drop-in facility and free seminar series had raised awareness of what was available through ECOM and soon customers were approaching Geoffrey looking for consultancy and support. There was little money available for marketing, but the client list began to grow through word-of-mouth recommendations and as the end of the first year approached there were more customers than the business could handle. The client list had been further boosted during 2000 as the local community sector had acquired a significant grant allowing it to directly purchase ICT support from ECOM for local community groups.

At this stage LEDU, the small business support agency, was approached and a small grant was made available to take on an additional employee. The business was now growing, both through direct sales of ICT support services to a growing client list, and also by competing for some grant-funded support projects to third parties.

After a couple of successful years, during which the business built up an operating reserve of about £70,000 and contributed around £100,000 of profit to its parent company, a decision was then taken in 2001 which was to have a dramatic effect on the future of the company.

The decision was to seek to grow the company, particularly in the ‘primary market’ of medium sized non-profit organisations, but also to develop the market in the private sector, focusing on businesses providing professional services. This happened alongside a decision to become less dependent on delivering large grant-funded projects.

To ensure that the company had sufficient resources to meet the expected demand, two additional posts were created, giving a team of a managing consultant, two IT consultants and two IT assistants. This move to grow the business coincided with the decision to change the name of the business to Avec Solutions, to avoid confusion with another IT company with a similar name to ECOM.

While the decision to grow the client list was certainly successful in terms of attracting many new customers, it also came within ‘a hair’s breadth’ of sinking the business. The company had budgeted for a loss in order to make a significant investment in growth during the 2002-03 year, but as the end of the third quarter approached, losses had reached £60,000, using up virtually all the reserves built up in previous years. Although the business had donated £100,000 of profit to its charitable parent company, these funds were no longer available to the business, which was in serious danger of folding if urgent action was not taken.

And indeed urgent, and difficult, action was taken. Two staff were made redundant, existing staff relocated to much smaller and cheaper offices, other savings were made and the business ‘pulled out all the stops’ to gain new business. It also became ‘harder’ in terms of not taking on less profitable work and more vigorously chasing bad debt, especially from some non-profit organisations who were perhaps abusing the company’s goodwill.

During the final quarter no further losses were incurred and by 2003-04 the business moved back into profitability, with a leaner operation and much healthier client list. It had had a serious ‘scare’, but had emerged all the stronger.

As managing consultant Geoffrey can now add with hindsight: “We know we were taking a risk in growing the business, and perhaps with inexperience we underestimated the cost. However, we learned more about running a business through responding successfully to our mistakes than we ever could through any number of management courses.”

Future plans

Having now established itself as a leading provider of ICT services within the Northern Ireland voluntary sector, and a significant and growing private sector client list, Avec Solutions has no intention of ‘resting on its laurels’.

Adding to its network installation, contract support, web design and hosting services, Avec has recognised the growing integration of data and voice technology and has now developed the necessary expertise and experience to implement fully integrated telephone systems for clients using Voice over Internet Protocol (VoIP) technology. It has also recently launched its own ADSL broadband service.

Avec is also aware that, in addition to providing high quality ICT support to its clients, the business has a responsibility to achieve a profitable return for their ‘owner’ East Belfast Partnership and are determined to do so by continuing to grow the client list. However, it also recognises the importance of maintaining and indeed improving the quality of service provided and to that end it has recently appointed a customer care co-ordinator and made customer care the direct responsibility of a specific senior manager.

In addition, with the relative success of Avec Solutions and associated companies, there has been considerable demand from others in the social economy sector to provide practical help, advice and support. As a result, Avec Solutions is now offering such support on a consultancy basis, although being careful not to take away from its core business of ICT support.

Lessons learned

According to Geoffrey Ready, many lessons have been learned over the past seven years, with perhaps the most valuable being learned ‘the hard way’. These would include:

Don’t forget the basics: the business has definitely learned through hard experience that keeping a clear focus on profit and in doing so watching costs, credit control and cashflow, is of paramount importance. The simple fact is that, if the company does not make a profit, it will go out of business and be of no value to either its owner or customers.

Customer is king: in a service business such as Avec’s, the company has learned to focus on customer needs and indeed has now based its marketing around quality and customer service with the vast majority of new clients coming through recommendation from existing customers.

Customer care doesn’t mean being ‘soft’: while Avec does understand the grant related issues faced by many non-profit clients, and seeks to work supportively with them when for example grant payments may be late, it has also learned to distinguish between this and being taken advantage of. Indeed, in a few situations it has not been afraid to threaten legal action to secure payment for services provided, although this is still seen as a last resort.

Grants are no substitute for clients: Avec has delivered a number of projects over the years based on grant funding, but has learned not to be dependent on them. Indeed at times the bureaucracy surrounding the grant has made it difficult to focus on the core business and Avec is now hesitant to take on work where grants are directly involved. Avec sees its future as built on providing an excellent quality of service to a growing and loyal customer base, although where appropriate it will certainly be open to delivering externally funded projects where it sees a definite opportunity.