Keeping around outdated computers could cost businesses more than the price of an upgrade. Most small business owners understand this intuitively, but what they may fail to recognize is that outdated hardware and software are both a liability and a lost opportunity. Said differently, failing to upgrade outdated technology in business at the same pace as industry competitors could prove to be a significant disadvantage. We’ll help you understand why:
Business Security Risks
Outdated technology has many consequences, each with notable costs. Cybersecurity is a prime example – technology that is even just a few years old can be extremely vulnerable to hacking, especially if without regularly updated security features. Insecure technology is a serious risk considering that the average cost of a data breach in 2018 was $3.86 million, up 6.4% from the year before. Even if a cyber breach costs a small fraction of that, it could destroy the finances of a small operation, which helps illustrate the real threat of outdated technology in business.
Negative Impacts on Productivity
Lost productivity is another consequence. Over time, outdated technology becomes more of an obstacle than an asset. Users have to work around its flaws, which only wastes time, hurts morale and cuts into output. A recent survey proves this point: 82% of the 1,500 respondents said their productivity suffers because of poor information management. As a result of outdated technology in business, they accomplish less than they could. For small businesses that must do a lot with a little, putting up unnecessary roadblocks for themselves makes no sense.
Poor Customer Experience
Even customers suffer due to older, less capable technologies. Customers increasingly expect a shopping experience (online or in-person) that uses technology to make every aspect convenient, engaging, and consistent. That’s part of the reason why 73% of respondents in one survey said they preferred self-service technologies like self-checkouts and digital information kiosks. Companies can attract a lot of customers by using technology well. Conversely, they can repel both new and loyal customers if they don’t consistently upgrade technology in ways that elevate the customer experience.
Thus far, we have only focused on the setbacks outdated technology in business creates. To understand its full costs, however, we need to include what is lost by avoiding the newer, better, smarter technologies revolutionizing businesses in every industry.
Why Tech is the Key to Success
- Earned 2x revenue for each employee
- Experienced 4x higher yearly revenue growth
- Hired 3x more employees than last year
By all indications, small businesses that embrace the potential of new tech and implement it proactively reap substantial rewards as a result. Despite that fact, small businesses must be cautious about skating the cutting edge. It’s easy to waste a lot of money on unnecessary or unproven technologies that create disruptions without impacting revenue. One way to avoid the wrong technologies is to examine how other small businesses are spending their IT budget.
According to a 2018 survey, cloud computing accounted for the second-largest percentage (48%) of IT spending at small and mid-sized businesses. That makes perfect sense considering that cloud technologies are accessible, relatively economical and have a number of advantages over on-premises technology. For businesses with limited tech resources, the cloud has a lot of appeal.
Data backups ranked third on the list. In an era of digital business, there are huge consequences when data is lost, stolen, erased or made inaccessible for any reason. Data is the lifeblood of business. Losing it could bring operations to a stand-still, creating consequences that are impossible to recover from. Forward-thinking small businesses understand this risk and are insulating themselves by investing in backups.
Financing and accounting technology also leads the list, which relates directly to the problem of outdated technology in business. Three decades ago, technology revolutionized how businesses approached accounting. Now, thanks to advances in everything from automation to data collection, the revolution is going through its next phase. Modern tools can expedite huge accounting workloads, eliminate the vast majority of accounting errors, and provide the tools of strategic finance to even the smallest businesses. For something as important and overwhelming as accounting, technology is an obvious asset. Based on the survey data, many small businesses agree.
Older technologies are familiar and comfortable, making them harder to give up. When compared to newer technologies, though, it’s obvious why tech from the last generation is quickly being replaced. Small businesses have a lot to gain by embracing the new. Alternatively, they have a lot to lose by trying to make outdated technology in business work for today’s and tomorrow’s economy.
Equipment Leasing to Boost Performance and Bottom Lines
No small business will be able to run efficiently if it doesn’t have the proper equipment. Leasing options give small business owners a chance to obtain the tools they need without having to spend large amounts of cash out of pocket.
This alternative to buying equipment can also help owners preserve their working capital. Put simply, leasing instead of buying saves more cash, and having this money on hand is essential for small businesses to stay flexible and secure in today’s market. Even better, leasing comes with numerous tax-saving benefits business owners would not be eligible for if they purchased the equipment outright. All this comes together to result in healthier bottom lines.
With no down payments, same-day approvals and virtually no limitations on the types of equipment that can be leased, small business owners who find themselves relying more on technology can rest easy. Avoid outdated technology and all the associated risks while outfitting your small business to succeed.