Technology has leveled the playing field for businesses. Smaller companies with fewer resources can now compete by investing in new platforms that provide value to customers and employees. In fact, nearly three in four small businesses said that technology helped them compete with larger companies, according to the U.S. Chamber of Commerce.
Additionally, four out of five small businesses that use six or more types of technology reported a growth in sales, employment and profits. And 79 percent of these companies reported growing employment compared with only 62 percent of businesses that don’t invest in as much tech. This confirms that small businesses investing more in IT grow at a faster rate.
Knowing that the competition is constantly investing in IT, organizations are pushing to pay for new software or hardware to overcome challenges or to keep up. But this short-term way of thinking makes for a bitter pill to swallow when companies are investing in technology to meet their current needs, only to have that technology become outdated a few years later.
The Timeline for Business Technology
How long can business technology really last?
If companies buy business-class hardware, the end-user technology can last for at least three years, and often over five. Organizations can extend the life of that hardware by implementing solutions such as:
- Software as a service (SaaS) applications: SaaS changes software access by offering online subscriptions that can be updated rather than traditional one-off installations.
- Cloud storage: this enables the seamless management and on-demand availability of large data volumes, eliminating the need for direct user oversight of computer system resources.
The shift to SaaS applications means users don’t need to constantly update or replace software. And with data stored in the cloud, the heavy lifting of processing is done remotely, reducing the demand for high-performance local hardware.
So, if technology can last longer, how can a company determine how often it needs to invest in new IT to stay cutting edge?
Factors Involved in IT Update Frequency
The need for new investments can often be determined by how much technical debt a company has. Technical debt arises from work that is “owed” to an IT system when teams sacrifice quality to meet deadlines.
Companies that keep up with a three- to five-year hardware replacement cycle and invest in getting more out of their current software will be poised to use technology to grow rather than investing to stay current.
But what’s the point of investing to stay current when modern technology is constantly evolving, making it virtually impossible to remain up to date? Each company’s update frequency will be unique to its situation, but it all comes down to whether or not the software it has contributes to an optimal experience.
At the end of the day, customers expect companies to offer technology that enhances their buying experience or delivers value with ease. They’re less concerned about the specifications of the technology businesses use or whether employees have the latest laptop model.
What matters most to them is how business systems, platforms and software can directly provide value to their needs, whether it’s through easy transactions, personalized services or innovative solutions that cater to their preferences and requirements.
How to Best Invest in IT
Companies need to define their business outcomes and then work backward to see if their current technology and software can achieve those outcomes. If it can’t, that’s when an IT investment is required; just because a system got them this far doesn’t mean it will get them where they ultimately want to go.
Consider a manufacturing company that’s trying to increase productivity through automation but is held back by outdated machinery. An IT investment is needed to upgrade equipment with new software that assists in automation, allowing the company to be more efficient, reduce costs and stay competitive.
Companies also need to consider user adoption when making these decisions. If they don’t budget, train and show the “why” to their users—especially their employees—adoption rates will be low, and the investment won’t be worth it.
Here are recommendations to increase user adoption to new technology and software:
- Allocate budget for training: set aside funds specifically for training sessions led by the software provider or internal trainers, ensuring employees have the necessary skills to use the new software.
- Provide tailored training sessions: recognize that different departments may have a range of needs and skill levels by offering customized training. For example, the marketing team might focus on campaign management features while the IT department focuses on integration capabilities.
- Communicate the benefits: before rolling out the software, communicate how the new software will streamline workflows, improve collaboration and increase productivity, emphasizing how it will make everyone’s jobs easier.
- Offer ongoing support: establish a support system in which employees can easily access assistance if they encounter any issues using the software, even after the initial training sessions.
- Involve users in decision-making: prior to selecting the new software, consult with key stakeholders from different departments to gather input. By involving users in the decision-making process, solutions are more likely to align with company requirements, increasing the likelihood of successful adoption.
Companies should consider these methods when introducing new technology and software. But implementing the right platforms isn’t the most important part of making sure IT can be effective in the long term.
Don’t Skip IT Strategy and Expertise to Go Straight to Technology
Rather than solely investing in platforms, businesses need to invest in people. Without the assistance of experts, it can be hard to know what technology may be needed or what the future of the industry’s IT field looks like. Instead, companies are left patching up gaps as best they can.
However, this approach won’t maximize the value of IT investments. To make investments work best, businesses need people and processes as well as technology. And the best way to find the right technical solution is by defining business outcomes, working backward and ensuring that support is in place.
This responsibility can’t fall onto one person or even a few people. It takes a whole team to handle the IT for an entire company if businesses want to grow rather than just fix day-to-day problems such as lost passwords. And hiring, training and retaining the technical talent required to do business today takes time and money.
In the manufacturing company scenario previously discussed, unexpected downtime due to software glitches or other technical issues could easily occur. Without assistance, production would shut down completely. The company could most efficiently solve this through working with a team to prevent problems via proper routine maintenance and applying patches and security updates during planned maintenance windows quickly and correctly.
Defining business outcomes and finding the right technology and resources to deliver those outcomes so that core business ideas can be supported allows companies to contend with the competition.
The secret to investing in IT lies in recognizing that it’s not just about technology—it’s also about investing in people and processes. By aligning IT initiatives with business objectives, building skilled IT teams and prioritizing strategic planning, businesses can maximize the value of their IT investments and drive growth and innovation effectively.
