Delaying major expenditures to upgrade outdated technology may seem like a good idea for your bottom line, but in reality, it could be costing your business more than it saves. Although the potential downtime to learn a new system and have your employees trained can be frustrating, it’s worth it in the long run.
The costs incurred from using outdated tech may appear minor, but once you make the upgrade, you may notice a more positive trend on your P&L. While some costs are tangible, others tend to be part of a cause and effect relationship where the expenses are less detectable.
Legacy technology is anything outdated with a newer version available. While it can keep your business running, it’s costly in terms of productivity levels, security, and maintenance. Let’s review a few specifics of where dated technology might be costing your business more than you think.
Integrations, accessibility, and automation are embedded within most modern systems. Data is shared through integrations, working on-the-go is easy with multi-device accessibility, and automation performs recurring tasks to save your staff time. These functionalities can necessitate an Internet upgrade to higher bandwidths, but yield higher business efficiencies than maintaining the status quo. How much money are inefficiencies costing your organization?
Another significant cost related to productivity is the tendency for aging tech to be slower and experience an increased number of errors. Even with proper maintenance, older programs can still have a lot of downtimes. You don’t want your employees unable to function at their normal productivity levels or worst-case scenario, experience a complete system failure where all of your data is lost.
Reverting to pen and paper orders that need to be hand-delivered to the appropriate department wastes valuable time. Don’t miss out on increased productivity levels by sticking with antiquated systems that are likely to break down.
A major concern for many people today is security. Almost 80% of consumers in one survey said that privacy and security are an important element of their buying decisions. Many industries have regulatory entities that hold compliance standards around security. When these regulations are not followed, it can lead to fines and other fees.
If your CRM is outdated and doesn’t receive updates, your business and customer data could be at risk. The cost of a data breach is incalculable. It requires the costs to recover any lost data (if possible) and the expense of contacting those affected and providing them with assistance to protect their identities. A privacy invasion is also likely to damage your company’s reputation. Upgrade your technology and avoid a breach of any sensitive information.
The IT support to preserve obsolete tech can put a severe dent in your bottom line. In the case of older software, phone systems, or computers, most don’t receive updates from the manufacturer and therefore suffer errors. If there is an issue, you’ll need to pay a specialist for repairs and to attempt any required data recovery. And, restoring data after a system failure is not always possible.
Don’t put your business in a position where you are risking its livelihood. Newer technology requires less upkeep and attention to maintenance, allowing your IT employees more time to focus on other tasks. For those outsourcing IT support through managed services, you’ll have more budget to allocate elsewhere.
When businesses have difficulties with aging technology, they also face another problem – meeting deadlines. Customers don’t care if your software was down for three hours, three days, or three weeks. They want their delivery on time, as initially agreed upon. After getting back up and running, you may need to pay your employees overtime or outsource some of the responsibilities in order to complete the work according to schedule.
These labor costs could be avoidable by replacing your outdated tech. It may be a wash for the first year or so to cover the initial investment; however, in the longterm, you’ll experience the cost benefits in the form of a reduction in labor expenditures.
Dealing with a slow program that has constant issues can be frustrating and stressful for leadership and general employees. It’s hard to perform your job well when the software can’t keep up. It can eventually lead to low employee morale and in turn, increased turnover.
The average cost per hire is about $4,000. Can you continue to waste $4,000 or more every few months as new hires become defeated and move on to another company? Employees want a job where technology helps them to do their job, not one that hinders their efforts.
Buying a new system for your business can be a large expenditure. The majority of older technology isn’t built to scale either. It usually requires a complete upgrade to expand.
Today’s Software as a Service (SaaS) and Hardware as a Service (HaaS) companies don’t have as large of an initial investment cost as those of the past. They are positioned for growth too. For example, instead of purchasing a whole new system when you go from 10 employees to 50, you may simply need to update your SaaS plan and allow an update to run from the cloud.
Newer technology can help to set you up for growth and in most cases, offers more security features too. Another bonus when it comes to cost is the tax benefit. Instead of logging your SaaS or Haas as a capital expense, it’s filed as an operating cost. Operating costs generally allow for a 100% write off instead of a small portion.
Companies that choose not to upgrade their technology may be risking losing their customers. Those concerned with privacy and security, or looking for better user experiences, may leave to work with your competition.
Updating your technology can help to differentiate your brand from others in your market. Are you offering a mobile application? Do you have a webchat option to reach customer service? Is your customer experience seamless across many platforms? What about your competitors? These are all aspects where your brand may be able to stand out with some new technology.
When it comes to customer satisfaction, reaching service personnel or any other contact at your company should be quick and straightforward. Landline phone systems work to an extent, but when you upgrade to a business phone system, there are many benefits. A few positives that come with a VoIP cloud-based phone system are:
Don’t let a poor user experience or lack of security cause you to lose business and miss out on new clientele.
Think about your organization for a moment and ask yourself the following questions:
After reviewing the above factors and questions, we hope that you understand the hidden costs of using outdated technology. If your phone or Internet is holding back your enterprise or small business, contact Cox Business to discuss your needs and learn more about our services.
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