If you have ever purchased a heritage home with the vision of renovating it to become a beautifully restored family home for a reasonable budget that you have carefully considered and thought out, you know how foolish that budget may feel once you have actually completed those renovations and uncover all of the hidden heritage wonder. I call our 1908 house the lovely money pit – it’s lovely but it sure proved to be a money pit.
Your decision to purchase technology for your company can sometimes make you feel like you have a technology money pit – where you feel no matter how much money you throw at it, you are never ‘done’ with spending money and someone is always asking you to get out the checkbook. So, how do you decide if the money you are spending is a wise investment or just technology wasteland?
- If you are still spending money investing in legacy technology that your vendor is no longer developing, this should make you cringe. It is completely appropriate and necessary to keep paying software maintenance on a legacy system while you come up with a transition plan to migrate to new technology. However, paying to develop features on your own or paying to integrate are not worthwhile investments if your vendor has retired the code.
- If you are planning to purchase new technology and you have a fixed budget that is inclusive of the software, the software maintenance and the professional services hours to implement, you may actually make a misstep with this investment. This oversight could result in your new technology, whether it is Print MIS or web-to-print, being a money pit. The technology could be fantastic but if you don’t allocate resources for customization and implementation beyond the actual software setup and configuration, you are at risk for the technology being judged as a ‘failure’ because you failed to invest in what it takes to make it come to life for your organization and your customers. Consider what your software to service ratio is most likely to be and ensure that you are budgeting for it. Whether you are tasking internal resources and backfilling with temporary staff, using third party resources, or a combination of both, don’t overlook this in your budgeting process. Believe it or not, planning to spend more money can actually be less of a money pit than planning to just buy the software and have it turn into shelf-ware.
- For any investment whether it be the purchase of brand new technology or the cost of a project within existing technology, it can be really beneficial to calculate the return on investment (ROI). This can be daunting and tedious but I actually find they can be quite freeing in terms of helping to guide your decision. Calculating ROI’s on investments for technology can be very intimidating but there are great resources out there including this blog on TechRepublic about what costs to not forget on software projects. Investing in ongoing development and marketing strategy to support your technology can be an incredibly worthwhile investment.
While it is very easy these days to question whether your investment in technology is akin to a house that has become a money pit, there is one critical difference – if you have invested in a good foundation that has a long future ahead of it, strategic and ongoing investment can be a very worthwhile investment.