As a business owner, you wear many, many, many hats. Too many hats, as our significant others might say.
We have to be experts in so many fields – finance, sales, marketing, operations, and human resources – that it’s no problem for business owners to pick up new skills and hold a basic understanding of the various areas of modern business.
But there’s one area where most business owners don’t have (and frankly, shouldn’t spend) the time nor energy to learn about – information technology or IT.
How Much Do Business Owners Need To Know About IT?
As we all know, IT is increasingly becoming the most important department of business these days. We’re going to be totally honest from the jump: most business owners don’t need to know IT on any sort of deep level.
Yes, more and more transactions are beginning and ending with the internet, and yes you need to make sure your IT department is up to snuff all the time – or risk losing business. And yes you need to have at least a basic understanding of IT.
There’s only one big problem: one could spend a lifetime learning IT and only scratch the surface of this deeply technical and highly jargonic area of business. When jargon enters the picture, things really start to get dizzy – when IT people start blabbering about P2Ps and SDLCs and DRPs, board rooms all over the world report glazed eyes abound.
That brings us to the purpose behind today’s article. We know how hard it can be to keep track of IT jargon – especially in the world we live in, where tech advances at a breakneck pace.
Just as you’re not going to learn the intricacies of accounting as a small business owner, it’s better not to waste your time getting too deep on trying to learn ALL the IT you can. Instead, it’s best to a) hire a team of professionals who know what they’re doing and can be trusted to handle your IT and b) learn just a few key areas of IT, so you can be educated enough to keep your business running smoothly.
That’s why we’re here today. We’re excited to introduce a new series here on the Fantastic IT blog. This multi-part series is going to cover all the IT abbreviations and acronyms one could need to effectively understand the most important IT concepts that your IT people are going to be talking about.
We reckon this will turn out to be a three or four blog series, but let’s see where it lands. Today, we’ll start with some of the most important ones first and work our way down. Without further ado, here are 12 of the most common IT-related abbreviations for business owners.
1. API (Application Programming Interface): APIs are everywhere – when you use an app on your phone, you’re usually using an API to access it. APIs facilitate interaction between different software applications, improving functionality for everyone. Business owners need to understand APIs to integrate various software tools and services, enhancing operational efficiency and offering better customer experiences, but you don’t need to be an expert or even know how they work.
2. BI (Business Intelligence): Strategies and technologies used for data analysis and business information management. BI is something any business owner should be familiar with nowadays as it allows you to make data-driven decisions, identify trends, and gain competitive insights. Basically, it gives you a better chance of making the right decision. All of your competitors are using BI, as underlined by its continued growth. A Markets and Markets report forecasts the BI industry to reach $33.3 billion by 2025.
3. BPM (Business Process Management): BPM is a systematic approach to making an organization’s workflow more efficient and adaptable via IT. BPM is vital nowadays for business owners as it allows you to better streamline operations, reduce costs, and improve overall performance. Studies show that BPM can reduce costs by up to 30% and improve productivity by up to 50%.
4. CRM (Customer Relationship Management): Strategies and technologies used to manage and analyze customer interactions and data. CRM knowledge is essential for business owners these days. CRM allows you to build stronger customer relationships, increase retention, and drive sales growth – largely because effective CRM creates a centralized platform that allows for better communication on all fronts. A recent survey revealed that 74% of businesses using CRM report improved customer relationships, which shows how it can only be a good thing for your sales team(s).
5. CMS (Content Management System): CMSes are software applications that allow users to create, edit, and manage digital content in real-time, via the cloud. Understanding CMS is important for business owners, and you probably already use some form of CMS already in the form of say, WordPress, which handles almost 40% of all websites! Yeah, a CMS is any tool that allows you to manage your website, blog, and other online content efficiently.
6. CDN (Content Delivery Network): CDNs are a series of proxy servers and data centers that deliver content to users. By using a CDN, you ensure fast and reliable access to your company’s website content for users worldwide. CDNs carry roughly 70% of global internet traffic as per Cisco (who are sort of experts at this thing).
7. DRP (Disaster Recovery Plan): We’ve covered this before in previous blogs – but a disaster recovery plan (DRP) is essential to any business. A regimented approach for responding to unplanned incidents and ensuring business continuity during disasters is absolutely essential in today’s hacker-happy world.. Business owners need to have a DRP in place to minimize downtime and data loss in case of disasters or system failures. Only 27% of small businesses have a DRP in place. If you’re part of the other 73%, get moving.
8. ERP (Enterprise Resource Planning): Software used to manage and integrate important parts of a business, such as finance, supply chain, and HR. ERP systems are vital for business owners to streamline processes, improve efficiency, and gain real-time insights into operations. The global ERP software market is projected to reach an eye-watering $78 billion by 2026!
9. IAM (Identity and Access Management): Cybersecurity is at the top of mind for many business owners these days, which is great to see on our end. IAM is how you manage your employee’s credentials and control user access to your company’s resources. IAM is crucial for business owners to ensure secure access to systems, protect sensitive data, and comply with regulatory requirements. The IAM market is expected to double in size in five years, growing from $12.3 billion in 2020 to $24.1 billion by next year!
10. ITSM (IT Service Management): As we’ve covered in our previous article on the topic, ITSM is a hugely important aspect of IT for any business owner these days. ITSM is a methodology – it’s a system of practices and processes for delivering, managing, and improving IT services. The bottom line is efficiency: ITSM allows for high-quality IT support, alignment of IT services with business needs, and optimal utilization of your IT resources. A study found that 56% of organizations saw an improvement in service quality after implementing ITSM.
11. ITIL (Information Technology Infrastructure Library): ITIL is actually a subset of ITSM – it’s a specific system of detailed practices for IT service management. ITIL is one of the most widely-accepted forms of ITSM and for good reason – according to Axelos, ITIL can see a 10% to 25% cost reduction in IT operations. Check out our article about ITIL for a deeper look at ITIL.
12. IoT (Internet of Things): IoT is the system of physical devices connected to the internet, collecting and sharing data. These days, you[‘ll probably want to know more about IoT than some of the other things on this list, as this new system can leverage connected devices for automation, monitoring, and tons of statistical and data insights that you previously may have not thought possible. Check out our recent deep dive on IoT to learn more.
Check back in with us over the next few weeks as we continue on with this new series – so at the very least, you can whip out some cool-sounding abbreviations next time you’re chatting with your IT team. Until next time!