Technology is the lifeblood of most businesses. Every company reaches a point where they ask, “Should we invest in technology?” This is the wrong question. They’ve already invested in it by living in 2013—phones, computers, and IT are basic technologies a company must have. Now we’re waffling over the details.
Should we Invest in More Technology?
From starting a Twitter account or investing in online customer service to participating in early-stage buy-ins, retailers routinely underestimate the time and cost required to set up and maintain new technology. But the right technology guarantees good ROI. For example, staffing businesses have gone from .xls files and faxes to Elance and Odesk. President Barry Asin of Staffing Industry Analysts predicts the online staffing industry will reach annual spending of $5 billion from today’s $1 billion. Revenue will rise by about 20% in the United States alone. As the industry rolls in new tech, he essentially predicts the death of staffing companies as they are now. In such cases, a company must invest in technology or die.
Avoid Investing in the Wrong Technology
Some companies invest in tech for the sake of doing so—they can, so they will. Restaurant apps are a good example of this; when was the last time you downloaded a useful fast food app? Small businesses can’t afford to make these blunders. As Business Insider reports, the #1 killer of businesses is poor strategic choices, like choosing the right tech. We’re in a new age of business where tech choices are just as important as political and financial ones.
To avoid investing in the wrong technology, prioritize investments based on their potential of growing the company, while remaining critical of investments that guarantee long-term operational impact while providing little growth. If a technology or software can help sales and help keep customers happy then it is worth the time to evaluate. Also, determine which opportunities align with existing architecture, meaning build on what’s already there. Finding a technology partner that will be honest with you on what your needs are is also critical.
Stick to the Basics in the Beginning
Forbes lists technology that is essential to all businesses: a great website, a reliable hosting provider, and a scalable customer relations manager. Companies that don’t already have The Big Three should take a step back and reevaluate how they present themselves to customers. The Small Business Administration also lists poor inventory management as one of the main reasons small businesses fail. So we think that is also something worth looking into.
Investing in technology as an eCommerce retailer is inevitable for those who wish to keep pace with or surpass their competitors. You are in a technology business already. Your concerns should be choosing the right technology, which depends entirely on your business; and budgeting.