On the Right Track

Eagan-based ORBIT Systems wants its clients to take IT for granted

By Andrew Bacskai
Minnesota Technology Magazine
Winter 2005

During the 1990s, Steve McFarland and Phil Palmquist spent the better part of three years building massive network systems for a succession of major-league corporations. The duo also worked together in the Minnetonka offices of Chicago-based Comdisco Network Services. They routinely spent 12 months on projects whose budgets commonly exceeded $50 million.

Before long, though, McFarland and Palmquist identified two key themes in their work. First, the systems they helped construct for their clients all ended up looking strikingly similar. Second, the overall impact their solutions had on these corporations was similarly negligible. "These companies are so huge that we weren't able to change the way they did business," McFarland says. "We basically delivered systems upgrades, which might have made them more efficient, but it didn't change the dynamics of their business."

So McFarland and Palmquist decided to adapt this top-to-bottom network capability, which generally was accessible only to Fortune 500 companies, to the underserved, undersized masses, for whom the bottom-line impact could be profound. "Your typical small company has what I call "point solutions," McFarland says. "It's very decentralized, very disorganized. It's not optimized, not consistent. There's not a cohesive plan--it's just pieced together." Consequently, he adds, "they don't get IT professionals involved until there's a problem. In the long run, it costs them more and has a bigger negative impact on their business."

In 1999, the duo secured $500,000 from an angel investor and opened ORBIT Systems Inc. Five years later, the Eagan-based firm is a rapidly growing $5 million enterprise that serves about 65 small- and medium-sized businesses from an array of industries.

"We become their IT departments," McFarland says of his clients, which have between 25 and 75 computer users per site. In fact, he adds, "our goal for them is to take IT for granted."

"But most importantly in a service business like ours, our most expensive resource is our people. So if, say, 85 percent of the environment from customer A to customer Z is consistent, I can take one of our help desk or field technicians or engineers from customer A and send them to customer Z.

And though they may never have been with that customer before, they know how the network is configured, for example. They know how the server is configured. They know how we do user ID administration, and so on. It's all very leverageable."

And potentially profit-enhancing for customers, many of whom, McFarland reports, regarded IT as a productivity-consuming, revenue-draining black hole. "We want our customers to be able to regain and build focus back into their business," he says.