According to a survey conducted by Gartner, More than half (56%) of organizations surveyed showed signs of purchase regrets for their largest tech investment in the last two years. Their biggest tech purchases failed to meet their high expectations. As a result, they were forced to spend more money on tech purchases to get a better experience.
The Gartner survey covered 1120 managers across North America, Asia Pacific and Western Europe. Most of them argued that technology was not the biggest issue but it was the buying process and the decisions that was the root cause of the problem. If you are a business who doesn’t want to regret your tech purchases, here is something you need to do.
In this article, you will learn about how you can save your business from regretting your technology purchases.
One of the biggest reasons behind the technological purchase regrets stem from the fact that most tech purchases are made by non-technical people. According to Gartner, 67% of tech purchase decisions are made by people who are not part of the IT department.
If your company CIO does not make any decisions regarding tech purchases, you are more likely to regret your tech purchase decision as compared to a business where CIO calls all the shots when it comes to technology purchases.
While you cannot change the organizational hierarchy or organization’s decision making processes, you can at least educate non-technical IT buyers and decision-makers to minimize the risk of regretting tech purchases. You can create a specific document with all the guidelines to make it easier for them to decide which IT purchases to make and which ones to avoid, based on the certain criteria.
Highlight key factors such as the impact of integration of given technology on security as well as day-to-day operations. Your goal as the CIO should be to enable non-tech people to make the right tech purchases for your business. The more you educate them, the better it would be for them as it allows them to make tech purchase decisions that your company won’t regret.
Vendor lock-ins and poor vendor management are two other reasons why organizations end up regretting their tech investment. When choosing your IT vendors, you must be strategic and more selective. Instead of deeply exploring every vendor, it is better to get an overview and see which ones might suit your needs better. Narrow down your list of vendors to a handful of choices and pick one which suits your business requirements.
Sanjay Macwan, a veteran technology executive shares his experience, “Challenge vendors to deliver on capabilities your business needs. I will take the top vendors and ask their viewpoints on how to operationalize [their products] within my shop. And I’ll ask how they’d measure our success using their products. We have internal metrics, but I also want to hear from them on how best to measure. They should have a proof point to share.”
All you need is to be intentional when collecting information about vendors. Remember to only collect information that you need to make a good purchase decision instead of accumulating everything you can get your hands on. This will help you avoid information overload and also make it easier to choose the right vendor.
In order to make the right tech purchase decision, you need to have a sound understanding of the capabilities of technology you are investing your money in. Moreover, you should also be aware of its integration and support requirements as well as its pros and cons.
Most IT vendors and service providers either try to lock you in long contracts or have hidden costs. Always remember that the money you are paying to buy the technology is just the upfront investment for owning it. There are many recurring and variable expenses that you need to consider, such as upgradation and maintenance cost.
Don’t forget to include all the costs when calculating the total cost of the technology. Then there are hidden charges you need to watch out for. Scrutinize the contract carefully and try to read between the lines, you will come up with some suspicious clause which can increase your total cost of owning and using the technology.
Most businesses are stuck in contracts due to vendor lock-ins, but if your business is not one of them, you should definitely move forward. I have seen many businesses stuck with technology that they hate for decades, just because they have made a huge upfront investment. This limits their capability to grow and put brakes on revenue growth.
Instead of crying over missed opportunities, you should look to make your future better. Always make tech purchases based on the business value they can deliver in the long run. If the technology can deliver immense business value quickly, you can go ahead otherwise, look for alternatives. The pace at which technology evolves and innovation happens these days forces businesses to be nimble and agile. This allows them to pivot quickly and respond to emerging market challenges faster.
In most organizations, purchase decisions are made after mutual consent. This means that there are multiple parties involved instead of a single decision maker. All the individuals involved in the decision making process can influence purchase decisions. Your goal is to create a diverse purchasing team with members from different departments.
Keep the number of people in the purchase team down to a minimum as going overboard can increase the risk of wrong decisions. Never make purchases in a hurry.Always take your time to comprehend the ins and outs of the technology. Hasty tech purchase decisions usually lead to remorse later on as they found out shortcomings about the technology they have missed.
How do you save your business from regretting tech purchases? Share it with us in the comments section below.