Beware the Cost of Doing Nothing!
Companies everywhere are having to save money in all areas just to survive. Most often this involves cutting spending through reducing payroll, skimming budgets, and minimizing “non-essential” spending. What constitutes “essential” versus “non-essential” spending may depend on what department you are in and who is making the decision. IT spending must be tracked to avoid the consequences.
Many times we see this at our own software business. We are researched by busy IT folks who have a need for a tool to help them do their jobs better and faster. Many times in these very departments there have been manpower cuts, and fewer folks have to do more work than ever. They can see the value of a tool to help automate processes to support the necessary manpower cuts. They will carefully research available software options, create a short list, and then make a final software decision. However, many times they are frustrated to find their request for purchase “denied “when it is reviewed by the finance office upstairs.
And while these difficult decisions are made in the best interest of conserving cash, decisions not to spend may actually be “costing” the company valuable money. Here are a few financial ramifications of delaying a decision to invest in a solution that would equip your team or organization with the best tools available to help them, and you, succeed:
1. Relying on manpower to do tasks that can be automated favors unnecessary spending. With advances in technology, the way we are able to do business has changed. Whether you are replacing a dated system, or starting from scratch, optimizing automated workflow technology can save huge amounts of time and money. When any stage of a process takes longer than necessary, or breaks down due to inefficiency, that time wasted translates into IT spending dollars.
2. Lost efficiencies and wasted time attempting to track requests, knowledge or equipment are often the order of the day when companies expect their support staff to “get by” with outdated software packages. These applications are typically lacking in functionality and some are no longer reliable and could “crash” at any time. When customers cannot access knowledge on their own and feel your response times are too slow, they may use this as a reason to find a new provider. This can quickly lead to lost revenues. In any economy, clients are valuable and customer retention will always have a definite dollar value associated with it.
3. Often, the initial research done on a software project may have to be scratched and started all over again. With personnel changes and changes on the product side, the valuable man-hours spent doing research this year may have to be “written off” in favor of a whole new round of research when the project becomes a priority again next year. Some companies will even routinely spend payroll on research projects only to choose to stay with the status quo (existing broken processes) over and over again.
4. Delaying a purchase decision can sometimes mean that the cost to purchase the favored product may be even more 12 to 18 months down the road. IT spending vendor discounts may or may not be available when the CFO says that it is okay to spend again. This makes it clear to see that waiting can sometimes mean spending more money as opposed to saving money. If a package seems to be a great fit for your needs, try working with the vendor to find a creative way to implement solution without breaking the bank.
It is essential when making an IT spending decision to count the cost of “doing nothing”. The savings that we are all looking for, across all departments, may be lost in truly unnecessary spending. Reconsider what is “essential” for running your department in the most cost effective way possible. A one time expenditure on software can save many lost man hours in recurring payroll.
Novo Solutions offers a suite of support and tracking software with affordable, flexible purchase options. Contact us for a free demo and 30 day trial to see it in action in your environment.