Dial a Nerd experienced an “incredible thing” when the lockdown started – it received a high number of calls from corporates to support their new work-from-home employees.
Dial a Nerd founder Colin Thornton said many people know Dial a Nerd as a consumer IT support brand. However, for many years up to 90% of Dial a Nerd’s revenue has been from small businesses.
“When lockdown was announced the phone started ringing and the tickets flooded in because all the businesses around South Africa started sending their staff home,” said Thornton.
“Where before corporate employees may have just needed to send email from home, they now needed to access company servers, VoIP, file shares, collaboration platforms, and more.”
What is surprising is that it wasn’t just the users calling, it was corporate clients who now had to deal with problems which they were not geared towards.
“Corporate IT teams who were used to dealing with large-scale and complex networks were now getting IT support requests from users with consumer-grade Wi-Fi access points, home firewalls, and FTTH routers,” said Thornton.
He said the lockdown means that Dial a Nerd now has a growing list of corporate customers who require support for staff at home.
While there were some unexpected business coming their way, Turrito Networks and Dial a Nerd, which have the same owners, experienced challenges during the lockdown.
30% of their customers are in the industries which have had to close during lockdown – such as retail, hospitality, and travel.
“These customers are requesting payment holidays, discounts, and suspensions over the period which Turrito Turrito and Dial a Nerd are trying to accommodate wherever possible,” said Thornton.
This will result in a short to medium term cash flow problem, which necessitated salary cuts and retrenchments.
“We have had to implement salary cuts for all staff who could not perform their duties remotely. Luckily, this shortfall was made up by the UIF COVID-19 fund reasonably quickly,” said Thornton.
He added they sadly had to say goodbye to a few staff as some project-based work has disappeared completely. “Should this reappear, or the pipeline start to grow again, we would re-employ quickly,” he said.
There is, however, a lot of positives about the lockdown which will improve their long-term business prospects.
A large proportion of Turrito Network’s business is focused on digital transformation, especially using the Microsoft 365 suite and it’s so-called Modern Workplace.
“The move to a remote working environment has highlighted and reinforced the need for digital transformation and customers who were not convinced four months ago have suddenly pushed it to a front burner,” said Thornton.
Over the last few years, Turrito noticed that the mid-market in particular was taking its time to become fully digital and move to the cloud.
“Some of these businesses have had very rude awakenings as their users found they couldn’t access on-premise file servers or use the phone system,” said Thornton.
Small businesses have mostly made the move faster and earlier, and during lockdown took collaboration and video platforms like Microsoft Teams for granted.
“Turrito is therefore expecting a lot of digital transformation projects from the mid-market in the short term,” he said.
Outlook for the rest of the year
Thornton said he expects big changes coming as IT departments, CIOs, and CTOs reevaluate what’s important for their companies.
“Before COVID-19 there was a growing interest and focus on security, data protection, and POPI compliance,” he said.
“I think this will get pushed to the back burner as businesses focus on staying afloat and relevant in a new world, my co-director Brian Timperley calls it World 2.0.”
He said the short-term focus from an IT perspective will probably be about cost saving, working remotely, becoming fully digital, and helping the rest of the business focus on a new way of operating.
“The IT market in general is quite protected from the COVID-19 effect, but we only exist because of our customers, and many of them are going to have an extremely difficult year,” said Thornton.
This is going to have an indirect effect on the IT industry and depending on the exposure, it could be quite significant.
“All modern businesses, organisations and governments rely on IT, but IT doesn’t exist without them,” he said.
“IT businesses will therefore need to think of new ways to add value in cost-effective ways while focusing on sustainable annuity revenue and lower expenses.”