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Are Tech Toys Worth the Investment?

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Everyday we are bombarded by advertisements, friends, co-workers and business associates who extol the virtues of some new technology or new technological gadget. However, is there a point where too much technology is bad for your business? While the answer will certainly vary with each individual and business, there undoubtedly is a point where enough is enough. Here are some points to consider when looking at the amount of technology you will be investing in for your business.

The first issue to consider always involves looking at the bottom line. Can your business actually afford to purchase these new tech gadgets or install that new financial system? Wasting valuable cash to purchase something you can’t afford is never a good investment. 

On top of this there are a number of other issues that must also be considered, along with the financial implications associated with each one. 

One of the main concerns revolves around the amount of training needed before the new technology can be used. Training can be very expensive and time consuming. Often a cost/benefit analysis will show that the cost to purchase and train is greater than the return from the technology investment. This means that a careful and thorough study must be done before purchasing and implementing any new technology.
Another added dimension that must be added to the cost of training revolves around the likely hood that employees can be taught, if they want to be taught at all. Not all employees have the ability to adapt and learn new technologies, while others; unfortunately do not want to be bothered. If either of these situations exists, the likelyhood of a successful migration to the new technology is very low.

Before investing in any new technology, you need to determine how often your business and employees will actually use it, or have the opportunity to do so. Your business is probably like most other businesses, full of products and technology that never, or rarely, get used. This is either because something new and better has come along, or the product didn’t do what you expected it would do. You are usually better off to purchase an inexpensive model in order to test and judge its performance and usefulness before spending significant funds on the proverbial dust collector. Eight track tapes and quadraphonic music are two examples of technology that didn’t make it. Try not to invest in any others. 

Another issue to be aware of is whether the new technology or tech gadget can be used all the time. An example of this can be seen with cell phones and other similar products. If you are buying these products in order to stay in constant contact with employees, you will need to be aware that they do not work outside of the Greater Prince George area. In fact there are areas within Prince George that have limited or no cell service at all. This means that if you are providing the cell phones to your employees in order to stay in constant contact, you may actually want to use a different product, such as a satellite phone instead. Take the time to look at all possible alternatives before actually making the purchase.

One of the most frequent reasons cited for purchasing or using new technology is to provide or increase efficiency or productivity. The reason being that the employee and business will be able to do more and at a reduced cost. However, one must be cautious. Most of the new tech gadgets can have the opposite impact on the business. Take for example the Internet; while no one will argue that it hasn’t helped their business, it has also given employees a toy to play with. Instead of spending their time on strictly company business, employees can now be found surfing the Internet for holiday bargains or sending email to friends in Europe. 

Other areas of misuse include using the colour photocopier and printer for personal use or using cell phones to make personal calls while out conducting company business. While many of these examples only use a few minutes or pennies, added together over a number of employees and calculated on a yearly basis, it is easy to see that there can be a significant negative impact to a company’s bottom line.
You must also be careful that you are not purchasing new tech gadgets just because you want them. There is a big difference between needing the new technology to stay competitive and wanting it because your friend has one. Make sure you are buying the product because it’s a great tool that can be successfully utilized by the business as opposed to a toy that most employees will quickly become bored with and leave on the shelf to collect dust.

The key when purchasing and implementing any new technology is to ensure that the payback period of the investment is shorter than the lifespan of the product, that it works with any old systems you are going to be keeping and that it will actually be useful to the business instead of a fun toy which chews up valuable employee time. 

-Myron Gordon owns TMSG Management Services Group, which provides management and financial services to growing businesses.

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