Is it Time for a System Update?
Advancing Technology is Requiring Business Owners to Consider Options
So much of business, and life, has changed. Much of that change has to do with reacting to the pandemic and its resulting disruption to normal business practices. Still other changes have been brought about by our own internal shifting needs and wants. And nearly all changes have some advancing technology component attached to them. In fact, technology’s growing role in businesses of all sizes is requiring us all to reconsider more advanced systems, software, and processes.
The question is—How many businesses have truly kept up with this transformation? Are they ready for yet another change or are they using old processes with an equally old thought process—if it’s not broke, don’t fix it? If it’s the latter, I would argue that when those processes are truly aged-out, they are, in fact, broken.
The Challenges of Using Outdated Systems
It’s understandable—change makes most people uncomfortable, especially when it comes with a perceived hefty price tag attached. Yet, what they often don’t consider are the costs associated with doing nothing. In this case, the costs associated with continued reliance on outdated systems and processes.
Challenges with the continued use of outdated systems are plentiful. A few of the most common pain points include lack of information accessibility, timeliness, quality, delayed reporting, noncompliance, and missing out on recruiting opportunities because the company appears outdated and behind the times. And the “band-aid” solution of getting a new system, while attempting to transfer old processes to it is also problematic. In those instances, the new system is not able to function as it should, resulting in even more costly inefficiencies.
The Importance of Due Diligence
Deciding when the “right time” is to update a system has always been challenging, but probably never quite as challenging as it is today. With so many technological advances thrown at us at once (and across nearly every department), it’s no wonder some are confused about which way to turn. But the decision starts, as all should, with proper due diligence.
Due diligence helps us to avoid making a quick (and often costly) decision in a time of need. With careful consideration, we may find that we don’t need an entire new system after all, but just some adjustments to what we currently have. But we won’t know if we don’t take the time to do our homework first. Some improvements and enhancements can be done without any purchases whatsoever. It all depends on what is currently in place and the goals and objectives involved. Asking the following questions is a good start:
- Where can improvements be made?
- What else is out there?
- What are our competitors doing?
- Is there anything that can be done to improve our current systems and processes?
- What are the benefits of the new system?
- Are we able to devote the time and resources required to implement this new system properly?
This last question is extremely important. As with any update, it’s not only about the system, but also the process to use that system. You can have the newest, most up-to-date technology, but if the team was not properly trained and a new standard operating procedure not created, the new system will not produce the results it was expected to. Additionally, the team may enter data incorrectly, resulting in error-prone reports and potentially costing the company even more money. For example, if it relates to a compliance issue, the company could incur penalties and interest as a result of these inaccuracies. It’s crucial that everything pertaining to that system be updated at the same time in order to reap the benefits.
Currently, some of the most common considerations when deciding whether to update to a new system involve automation and cloud software.
Too many business leaders spend too much time completing mundane, everyday tasks that are repetitive and simple. Not only is this inefficient, but it is also not cost effective. Automation is the single best way to solve this problem. It allows employees to complete manual tasks at the click of a mouse, freeing up their time to work on more important matters.
We saw firsthand during the pandemic how connectivity and access to information were keys to keeping our doors open. In most instances, this can only be achieved with cloud-based technology. With more people continuing to work remotely, at least some component of this may become more of a necessity than a luxury going forward.
With all of the changes we’re experiencing, businesses should review their current processes or have a third party come in to get a professional, outside perspective prior to making any decisions regarding updates and/or purchasing new systems. The costs of keeping the current system should be compared to the costs of purchasing a new one, considering not just the monetary value, but other benefits, such as better security, increased efficiency, increased compatibility, more satisfied teams and customers, and reduced costs. If the decision is made to purchase a new system, a strategic plan for implementation should be created, including new processes and training, so that the business propels forward uninterrupted.
Barker Associates provides strategic guidance and outsourced CFO services to companies of all sizes. We can provide the higher level of strategy your company needs to grow, including advising on systems and process updates. If you need assistance, or have any other questions, please click here to schedule a 30-minute consultation at a rate of $100.