Technology in tough economic times
By Peter Switzer

Leveraging technology to better your bottom line

In times of economic uncertainty, all sectors of the business world are looking to transform their operations to reflect a leaner business model – one that spends less money to accomplish more with fewer resources.
Businesses must be prepared for the challenges that await them - and this includes the area of information technology (IT).
Crisis can also be a time of opportunity however and sound technology investments can help small and medium businesses (SMBs) remain competitive while navigating through uncertain economic waters.

Sensibly spend to save
Unlike large businesses, it’s quite common for SMBs to have limited resources allocated for IT expenditure. In a downturn, many smaller businesses will spend only what they must to keep the power on, servers running, and maintenance in check - the basics. But these days when it comes to IT, you often have to spend to save. The greatest challenge for SMBs when it comes to technology expenditure is knowing how to spend effectively.

Make IT part of your plan
Making a business more technology-centric should be a goal as part of an overall business plan. This doesn’t mean that any technology needs to be purchased right away. It’s a question of:
• How to make the most of the technology at hand and
• How to leverage and streamline it?

Cut costs + increase productivity
In a volatile economic climate, business owners and IT managers should ensure the majority of spending on technology is limited to the following objectives:

1. Boosting business productivity
2. Streamlining decision making processes and
3. Communication with a client base (usually through Customer relationship management (CRM) software).

There are exceptions to this rule, but when times are tough, spending outside these areas will generally only cost more money and deliver no significant benefit. In tough business conditions, it’s the ‘like to have’ technology projects that should be put on hold for more cash productive ones.

Take a wise approach
While cautious spending is mandatory, business owners should not use a downturn as an excuse to cut planned technology spending altogether. Far too many SMBs take the 'as-is-needed' approach to IT expenditure. This creates mixed platforms, unnecessary capital expenditure and a lot of pain when the time comes to plan and budget properly - usually when serious problems are beginning.

Be informed
The chance to plan from scratch is a luxury most SMBs can’t afford, however the longer a business operates without any professional help, the more costly it will be to correct things down the track. Most SMB owners don’t have the time for technology research, so it’s smart to consider taking advantage of an IT provider’s knowledge about what products are available in the market and what value they can add to your business.

To ensure you see a return on your IT investments it’s imperative that any recommendations made by a technology expert are supported by substantial evidence to show the benefits to your business. Nobody knows your business better than you and before acting on IT investment advice make sure it falls within key requirements for spending – which are always either to increase business productivity, reduce decision time by staff and/or increase responsiveness to your client base.

Risk management
Risk management spending will become more prominent in the current environment as the return on investment case is easier to make. Technological innovations can dramatically assist with risk management.

Security is one area that becomes even more important in a downturn. Huge amounts of money are made in illegal data mining, spam and viruses and SMBs need to ensure they have an intimate knowledge of security protocols surrounding their email, primary data sources, global virus protection and disaster recovery. Any weakness in this area can lead to long-term costs in productivity and direct dollar losses.

Life cycle management and road maps

In a downturn the importance of budgeting cannot be over emphasised. SMBs should look to put in place a three-year road map in IT expenditure. While these may change with the economic climate, businesses should see that their IT supplier or someone within the business is accountable for checking the 'milestones' monthly. This will mean when a business starts moving away from its plans, it’s simple to reassess, budget and realign. The road map should be monitored monthly by a member of staff or an IT provider. 

The magnitude of the current turbulent economic times leaves many smaller businesses feeling powerless. A well-planned and managed IT system is one way SMBs can take back some control. Technology infrastructure should not simply be viewed as a unavoidable expense, but rather an integral, evolving component of your business. An effective approach to technological investments will assist your company to navigate through the difficult economic times and emerge stronger and more efficient when the tide turns.