Ep 29. Andrew Tucker CEO of ITonCloud – The Honest CEO Show

The Honest CEO Show, Episode 29: Andrew Tucker, CEO of ITonCloud

Caroline Kennedy (00:20)
Welcome to the show. And today my guest is Andrew Tucker, who is the CEO of ITonCloud, which helps businesses simplify and automate their IT systems by leveraging the cloud. Andrew has more than 20 years of experience as a successful business owner and passionate entrepreneur. His goal has always been to build and drive ventures to deliver unmatched service levels, customer value and trust.

Welcome to the show, Andrew. Now tell us about ITonCloud.

Andrew Tucker (00:53)
Thank you for having me.

ITonCloud is a private cloud. We are a host of professional services or healthcare in terms of allied health. What we do is we take all of their IT and we move it into our data centers. Now we don't physically actually take the equipment, it's all our equipment is in place. We take all the line of business applications and we put them on our servers. What does that mean? That means that you no longer need to have any servers on premise or even have any IT staff, depending obviously the size of the business. And we look after everything that's inside our data centers. So it removes the cost of equipment, the licensing and all that maintenance that goes with it and we then take care of everything for a fixed user per user price.

Caroline Kennedy (01:44)
Okay, so technology is advancing rapidly as we know, and it allows, as you've just described, all business of all sizes, big or small, to tap into the same resources, and cloud-based technology provides many benefits to business. I'm sure flexibility within a mobile workforce being one of the main benefits, but tell us about the key advantages your clients see.

Andrew Tucker (02:10)
So again, it's saying is that, you know, focus on your business, not, you know, on IT in a sense, because really what happens is when you have a lot of equipment that's on premise, you tend to be, you know, as either as the owner becomes the go-to person, or if you're the financial director of the company, you're the go-to person with IT. So it's very distracting for businesses to actually manage, keep up, look after.

And when you look at the scenario around crypto virus and the crypto locker, that is all, you know, things that you just don't have the expertise to know how to protect your business and to look after the environment to the maximum that it could be or the potential that could be used there. So when you move into a ⁓ cloud environment, you're getting all of these as part of the package. So it actually moves all that having the time of having to think about how am going to do this? How am going to grow? How am going to protect the business? And you can actually start to focus on your business.

And you mentioned a bit about the agility factor there. So now how can I take what I've got and make it more sticky to my clients? So what value add can I give to my account? And this is where cloud gives you that advantage because it's so easy to switch on and switch off, try things, do this, do that. It really is an enabler for businesses now. So stop worrying about the IT and all the things that go with it. And now focus on how you can actually maximise your IT to benefit your clients and at the end of the day your bottom line.

Caroline Kennedy (03:39)
Yeah. And I think that that's a really good point because I see a lot of business owners that obviously IT is not their forte yet they're focusing on it and are challenged around it and it detracts them from their main focus, which is their business. And that also leads me to the fact that I do see many businesses struggling with prioritising to work on their business rather than in their businesses, which is what you've just described. So how do you, in your role, prioritise your focus in regards to that too?

Andrew Tucker (04:16)
Yes, it's good question that you can quite easily be sucked in. And I think it comes down to two things. One is really what your vision is for your business. And are you the person that's to drive that business to what that vision outcome is? Because if you have really good staff, and I think that's what it boils down to, and I think that everyone has heard this over and over again, good staff equals good results and the net outcome.

But it is that you need to take your time and getting your right stock in. And they say simple fingers, high, slow, fast, it really is, there is actually no better saying than that. And we've spent a lot of time going through who we take on as stock members. Do we really want an entrepreneurial type employee that thinks out of the box, is really willing to take those big steps and making better not only for themselves but for the company and get rewarded for it.

So that allows us then to focus on the bigger picture knowing that our staff are really client focused and they want the best outcome for both the business and our clients.

Caroline Kennedy (05:23)
Yeah. And you know, you mentioned prioritising your team and that equates to the quality of your leadership and the leaders within your business and how that has a direct impact on the successes of your business, as you just mentioned. So tell us about how perhaps you prioritise leadership development within your organisation.

Andrew Tucker (05:48)
Look, if any of our staff wanted to improve the educational status, we are 100 % behind that. And we do fund all of that. It is something that's not pushed on them, but certainly we like to see them take that up. And that starts to bring in a different form of understanding of the business. And again, it strikes up great conversations. So you're not only sitting in a meeting with them talking about the business itself, but it's also talking about we can do things better because if they come in and they ⁓ monkey see, monkey do, that is poor leadership in my opinion. That's almost micromanagement.

And I really like to see in how we can install that upward thinking of each of our employees. And education is part of it, but also experience and ability to be able to say what you feel without being intimidated or concerned about, that was a stupid thing I've just said. So we really through tried and drive the openness is inside our business and therefore they feel comfortable with our leadership and we comfortable with their ability.

Caroline Kennedy (06:53)
Yeah. And what you've just described to me is empowering your staff and it's such an important part of leadership and innovation as well, so when your team feel empowered, they feel like they're exposed to new things. They go off and they're educated and they learn and they look at different elements in other businesses and have robust conversations around the industry, business in general, it just, it challenges that status quo and just brings in so much more of varied elements as well and innovative thinking too.

Andrew Tucker (07:32)
You find that you actually will leapfrog your competition if you embrace it. I don't like to be the cleverest person in the room, which I'm generally not. That is a good thing. You've really learned from it as well. It's not a one-way street. You really want to make sure that you're getting as much out of them as they're getting out of you. The benefit is that the business takes that leapfrog opposed to what your competitors are doing. I don't understand why it's not a given, but I mean, I do understand people do some leadership mentality is "it's mine: if I don't have all the answers, I'm not the right person." But again, I suppose it comes down to confidence and trusting in your own ability.

Caroline Kennedy (08:18)
Yeah. And I also believe that we're shifting to, and we have been shifting over the last decade in away from old school management into modern day leadership. And because of technology and the evolution of technology and how markets are changing because of that, we do have to shift our thinking. But I suppose there are a lot of business owners out there that don't know what they don't know and have not gone out to be exposed to varied elements. And as you said before, it's the monkey see monkey do, and if they don't know any different, then they don't know how to improve.

Andrew Tucker (09:03)
Yeah, it's true. That's true. But unfortunately, I still see a large number of businesses in that old way.

Caroline Kennedy (09:13)
And it is unfortunate because it's holding them back.

Andrew Tucker (09:17)
Well it is, it is. And as you mentioned there, you're saying that technology is enhancing and allowing your staff, I mean a lot of our staff can work from home, we do encourage it if they've got young kids during the holidays, but they still actually are as productive as they would be in office because we've given them the tools to be able to do that. I think that's the beauty about the way technology has moved is that they can actually be anywhere and be productive.

Caroline Kennedy (09:44)
And I think in addition to that also the fact that you offer them flexibility, they value that. And in turn, they're more productive because they know how much they're contributing to the organisation and the value that they bring to the organisation and the fact that they are valued as people too.

Andrew Tucker (10:10)
It's true and you know, just a simple thank you or a well done, it goes a long way. And I see very little of that in the industry as well. The staff want to know that they're doing well and they want to know that they are achieving as well. It doesn't always have to be a monetary reward. It can just be that as I said, a simple gee well done or thank you. Well, that was brilliant.

We do reward our staff with holidays or anything like that because they put the hours in and they really do long hours. They've got to recharge. The only way to do that sometimes is if you actually force them on a trip overseas because they just get so involved in the business. It's fantastic that we have that culture, but at the same time, the next step is the burnout. That's what you don't want when you've really got good staff.

Caroline Kennedy (11:01)
No, absolutely not. It doesn't help anybody when they become burnt out and it just becomes a cost to the business as well as themselves personally. And that's not an outcome you want for anybody because at the end of the day, we're all people. You know, I always say it's the people that make a business. When I talk about the people, mean the customers as well as the team within the business and without them, you don't have a business and it's so easy to neglect that when you're just focused continually on the bottom line and nothing else.

Andrew Tucker (11:36)
Yep, yeah, now I see that a lot.

Caroline Kennedy (11:38)
Yeah. Now we live in a fast paced world where business is evolving rapidly and staying relevant is integral to ensure your business is sustainable long term. Businesses can't afford to be complacent or to do business as usual. And so how do you ensure you stay ahead of the game and continue to remain relevant?

Andrew Tucker (12:00)
Yeah, and especially in our industry, which is evolving at one hell of a rate at the moment. And I've been in this space now for 25 odd years and it's changed so much from the day that we had the first business that I struck up. it's like the concept has been the same, but as you say, the relevance has changed so much. Look, you know, again, it's about the travel, it's about attending webinars such as these ones.

I got involved in a really good organisation, like the entrepreneur organisation. It's learning from others and learning what people want and where businesses are going and can you find something that those businesses require, fixing the problem or removing the pain. That's what we do. We try and stay on top of what the next step is going to be each time. ⁓ Not easy and it's not a perfect science, but I'll tell you what, if you don't try and you're not staying at best as you said there, you are going to fall behind your competitors and your relevance then will dissipate.

And I do see it in our industry where those that are doing the same old same old, not doing any value add in their offerings or really ticking the boxes, the small things that really make businesses sticky to you, just because you think, oh, that's a little bit of an extra cost or I'm not sure that we can afford to put that in.

The question is, can you afford not to put it in or not to take that next step or change the way that you do things because your market has changed because you think you've got the recipe, especially in our space. I mean, if you look at it, there were more than 200 of our type of businesses that collapsed last year and the numbers are going to grow this year. We're very fortunate. We're growing over 60 % year on year. We're really trying to make sure every year we do that little bit more for our customers and something a little bit more relevant, etc. So, yes, it is something that you cannot negate or neglect.

Caroline Kennedy (14:00)
Yeah. And it's interesting that you say, you know, you've got competitors that are struggling because in any industry, this is relevant. And I know, you know, I led a business in the travel industry when it was being disrupted by online coming into play. And it was only through ensuring we remained relevant and becoming customer centric and actually asking the customers what they need and not just asking them, because sometimes people don't know what they need as well, but looking at trends and just observing and going out and finding those insights and analysis, but shifting focus to what are the problems within our industry and how do we solve those problems.

And again, this business grew quite significantly in a time where others all struggled. So it is imperative and I continually stress to business owners the importance of what you've just described in that remaining relevant and ensuring that you continue to be that customer centric. And I know that that is something that you really believe in. And so tell us how you within your organisation put the customer at the heart of everything that you do.

Andrew Tucker (15:28)
Yeah, it's also, I mean, it's sort of a four-pronged process that we look at. And it starts also with your staff. the simple thing is when you're on that phone with them, while when you talk to them, because they can actually feel that coming through the phone and understand that, you know, with IT, it can be extremely intimidating to the user, even though it seems so simple to you because you, you know, you're in the game in the space.

So never talk down to somebody. Always try and understand where their pain is, sympathise with them and give them an answer that they want to hear. But don't say something that's irrelevant or not true. What I'm saying is that they still want to hear from you. I really don't know the answer for you, but I will get back to you. And that's the next point. The point being is get back to them. Get back to them in a reasonable amount of time.

I mean, I've just had a horrible experience in purchasing a vehicle, which we can discuss later. It shocked me how they run it. The next thing is once you've gone through that process, then follow up on that client and say, right, you know, we've checked with it, we've done it, we fixed it, and we've gone, are you happy? Is there anything else we could do? And can we do anything better? And it's this simple caring about is that they actually feel important that they're not just a number. And I think a lot of clients, a lot of people just feel, hmm, all you are is the credit card and that's all that matters.

We actually want to make them feel like that they are real people and we do care. And we have installed that sort of cultural side of the business and I don't like and I don't tolerate, geez, that's a painful customer discussion once the phone has been put down or anything like that. Again, that brings in the negativity around that time.

Now each time they've got to think, shit, that was a great question or that was a difficult question. Why did they ask me that question if it's for such a stupid question in first place? Then, know, it's obviously it's our educational process that hasn't been correct. So you're always looking at advancing what you've got and enhancing what you have in place. Then I like to make sure that I'm touching base with every single one of our clients. So I try and do a survey twice a year. Some clients don't and will not answer a web-based sort of survey. And those I know, I really like to take the time to know each and every single client and those I'll drop in and actually go through them. Again, it's a question of if you had X, what would that be that would make your business better? And it's amazing how much I come back with to add into what we have as our offering. So it's more to the package.

There's a simple thing to really enhance the way the customer works. And if there's no bill that comes with it or no extra cost for that, even better, because again, you are then value adding and you're giving back to that loyal client that's been with you. We don't have contracts, so we've always got to be on our toes and making sure that our delivery is what we promise. And that comes to the final thing. Don't over promise and under deliver.

Just give exactly what you've been saying you're going to do and something on top of it without them knowing what's going to happen because that just gives the wow factor. It takes extra time, it takes a lot of patience and all the rest of it but at the end of the day, once you've got that rapport and you've got that trust with your client base, the likelihood of them moving somewhere else and this is an absolute disaster is very minute and we all know what the cost is to get new clients, opposed to retaining clients and looking after them. We don't have a sales force and our referral base is huge. So again, it's that you start to reap the benefits from that relationship that you have with your client base. So it does the hard work initially, but once you get the rhythm, and isn't there everything about that, you get the results.

Caroline Kennedy (19:35)
And to be honest, what you've just described is the basic business principles of your customer being at the heart of everything that you do. I think nowadays we tend to overcomplicate things, but at the end of the day, without your customers, without your team, you don't have a business. And I love that you said, you know, genuinely wanting to help them.

So if you don't know an answer, let them know you don't know an answer. But being respectful towards people too is what I'm hearing from you. And that's so important. Another thing about where you mentioned no contracts. I think a lot of businesses want clients to sign those contracts and once they're done, and signed, we've got you now for a 12 month period. So we'll shift our focus. We don't necessarily need to maintain that. And I'm not saying that that's all businesses, but I love the fact that you say we don't have contracts because what you're saying to your customer is we value you and you are at the heart of everything that we do. And we're not going to give you those long onerous contracts that you're locked into because we genuinely want to help you.

Andrew Tucker (20:54)
You do find that those that are in the long-term contracts that are supplying it, they get lazy, you know, a number of clients we've been across that are either toward the end of their contracts, it really does leave a sour taste in their mouth as they're leaving that because they've been with that supplier for so long, but they haven't been respected. And there's always these penalties for that and so on.

I say if the customer doesn't want to be with you, give them a bottle of wine and wish them good well and goodbye. Because you want that last experience to be a really good experience because they could come back. I can tell you what, that a lot of them will not go back to a lot of our position because of these three to five to seven year contracts that they've been tied into and with no advancements and no discounts or no thank you. It's bizarre.

Caroline Kennedy (21:51)
Yeah. And for me, that comes down to two things. First of all, the complacency out there that we discussed before, but also businesses becoming greedy and overly profit focused. And that's where things can start to derail. And what you've just described is I can imagine in the IT industry, which is highly competitive, you've ensured that you outperform your competitors because of your approach to being so customer centric and being genuine about that.

Andrew Tucker (22:27)
Yeah, there's a stage, I suppose some people say profit is not a sin. I totally agree with that. But at the same time, it's how much profit, know, it's the stage where it gets to garging. And we sort of said we've hit our point where we're really happy with our profitability and it's a really strong number. And we've said, okay, everything over that now goes back into the R &D and then this outcome is a better value for our client.

So if we find an application that we can purchase and we can put into our hosted offering, the client gets that for nothing. And each year we keep doing that and we keep getting more more value add into the package. And that goes straight back to them and to their bottom line. Well, the difficult thing to do if you've got your model that's in place. And I'll you what, the customer really appreciates the fact that you're not having those increases every year.

And if you can actually show that you're a well-run business, again, clients then is more comfortable with you and sees the sustainability and believes in the fact that each year there's going to be something coming back to them. mean, it's not a given, but it's a nice to know that that's going to happen. So we do, when we get to that stage of our profitability, we've said, okay, let's get back everything over that, back to our client base.

Caroline Kennedy (23:47)
Yeah, and I think that's a great philosophy to have. I understand that research and development is, has greatly aided your success within the business. And from what I understand, and correct me if I'm wrong, but you commit $3.5 million around that annually to research and development so that you can continue to remain relevant and deliver services and solve problems for your customers.

What are the successes you've seen from this approach apart from your ongoing growth, but in terms of working with your client base?

Andrew Tucker (24:25)
Actually, being twofold, the R &D allowed us to create some really clever IP within the business, again, giving our business better value if someone came knocking on our door. What it's also done is it's actually made us very sleek in terms of our operation. In other words, there's very few staff members considering the size that we are, and this is always an interesting one when you're in for a big tender.

We've got 11 staff looking after thousands of users. And the question there is how? And it is because we spent the money in R &D and been able to automate the entire system. So there's very little finger problems that we have in our system. Again, what does that mean for the customer? It means that the system is always up. There is almost no problems. We get ToFU support calls, which means that the customers are irritated. They don't have any problems with downtime and lack of productivity. And at the end of the day, they're getting what they paid for plus more without having the increase in price.

Now, that's another factor that we haven't had an increase for, I don't know, five, maybe six years now. And we've been able to do that because through the R &D smarts that we've put in and back end.

We haven't had to increase our costs of our overhead, but we can exponentially grow and still offer the same plus better service as we grow. And the customer therefore doesn't have to worry about those, oh next year we're going to have an increase. There's a natural inflation-based increase or anything around that. They know that it's pretty much going to be that price. Look, there are going to be times that Microsoft then hikes their price on us and maybe we have to pass it on. In saying that, Microsoft has done it twice to us, but we've managed to absorb that through better ways of sourcing the licensing, or just through the fact that we've been able to absorb it by part of that, give back with the profitability. So that R &D has really given us, I think, a really smart competitive edge against our competitors. And again, like I said, people are blown away by the number of staff we have considering the size of our client base and who and where we represent in the industry.

Caroline Kennedy (26:55)
Well done. I think that from what you've described to me, your business continues to be focused on the client, but it's agile and it's continuing to be a market leader. And there's not many businesses out there that are in that position, but clearly it works.

Andrew Tucker (27:16)
It has been lucky. The way we built it from day one has been around that mentality of how can we grow without the growing of the overhead costs. And again, we've used our own technology, our own product that we sell to our clients to be able to prove that the concept is true and relevant. So yes, it's a really, really good run on that aspect.

Caroline Kennedy (27:40)
And you mentioned luck before. I don't think it's luck. It sounds like, it's more like strategy to me rather than luck. a combination of both, ⁓ yeah, well that does happen, doesn't it? And finally, what keeps you awake at night?

Andrew Tucker (27:51)
My daughter's HSC exams at the moment.

It comes down to business. ⁓ I think it's just, you we look after so many very important businesses that have really sensitive data. And I just like to know that everything is in place. And I suppose, as my wife often says, mean, it's not being so pedantic about everything. I just like to check and check and check and make sure that everything is perfect.

It's not, I think it's more around the fact that at end of the day, I really do respect what we, you know, the client's business and what we've promised them. And I think at the end of the day, that's all we'd like to know, that we would never ever get to a stage where we'd have to say sorry.

Caroline Kennedy (28:46)
Yeah. And that's about taking ownership or your responsibility. And that's so important. Thank you so much for your time today, Andrew. really appreciate it.

Andrew Tucker (28:58)
You're more than welcome and I hope there was some value for those out there and everyone wants a little nugget every now and again and I hope that we got some of those out of today.

Caroline Kennedy (29:07)
There are definitely plenty of gold nuggets in this interview.

Andrew Tucker (29:11)
Great to hear.

Thank you so much for having me.