The People Cost of Technology

For decades the focus of business and technology solutions has been on the acquisition and implementation of the tool.

In the dawn of computing, hardware was the scarcest portion of early information technology solutions and IBM mainframes, which cost $1MM, were a large competitive advantage. In the 80s, we saw the rise of ‘micro-computers’ and the emergence of the ‘personal PC’ that led to the giants of technology that ruled the 90s: Microsoft, IBM, Sun, and Apple. The post-2000 era that followed saw the scarcity of yet another layer of the value proposition melt away as hardware costs dropped quickly. The new century brought in an age of abundant hardware and a rise in the value and importance of software.

Before software, most of the inner workings of a technology solution were hidden behind inflexible, complex hardware and early software. Developing solutions that were easy to use was prohibitively expensive so few companies did so. The creation of the spreadsheet, for example, was an innovation for PCs because for the first time a single person could summarize and calculate data in ways that previously took teams of people. But most people still find spreadsheets difficult to use and 95% of all spreadsheets created are static simple summaries of data. Few people can really make a spreadsheet dance with complex calculations and most of them work for your bank or investment firm and get paid well for that skill.

The more recent revolution of mobile apps and ‘The Cloud’ have raised the bar on usability and significantly lowered the hardware costs involved in delivering value to a businessperson. In some cases like Google Apps, the hardware is actually subsidized by advertising allowing solutions to be delivered to businesspeople at no cost.

This lowering of development and distribution costs of technology solutions finally brings focus on a cost area that I think has been a hidden cost of business solutions: the people cost of technology – the training and support of a solution.

For decades a company assumed that when they bought a new technology solution, the company would have to invest in training the people who used it and that their IT department would need to add additional resources to properly support the new solution in order for the company to achieve the productivity gains intended.

Today, companies can assume similar hardware and software costs around different solutions but the value comparison now includes two questions that might not have received as much attention in the past:

  • How much of a pleasure is the solution for my team to use?
  • How smoothly can we deploy and support the solution over the long term?

Cloud-based solutions definitely have an advantage in these two areas because they are usually easy to deploy, needing only a browser or mobile app in most cases. This advantage will be noticed by all software companies, and I expect overall software usability to significantly increase in the coming years. The companies who do not pick up their game in these areas will begin losing in the marketplace and eventually be disrupted.

Not all business solutions will provide their value over ‘The Cloud,’ but I think the most successful companies will look at problems from ‘The Cloud’ inward and work towards minimizing the costs and risks that are sitting inside their customers’ locations. The right balance between security, privacy, cost and cloud will be achieved over time, but like any revolution, many paths will be explored and forward progress will happen at staggering – sometimes blazingly fast – speeds, while at other times seeming to stand still. One thing is certain to me, ‘The Cloud’ is an important ingredient in any successful technology solution in the coming decade.

So how can your business spot these future winners when looking at the many technology solutions for the different aspects of your business? Here is what we look for here at Sinu and maybe these attributes show up in some of the solutions you are exploring:

● Is the solution to a problem clear and does it make sense to your team right away?

Some solutions that have not invested heavily in usability overcome this with an educational sales process. Some tools need a lot of clarification about how they work and how they help your business, but the amount of time spent learning how the solution will help should be proportional to the financial gains the solution will have for your business or how much risk and cost it prevents. A solution that can be understood quickly by your team will have an easier time gaining fans and internal champions. Having these promoters of the solution will not only help with implementation, but also bring more people with great ideas into the efforts. Solutions that are not a pleasure to use will be resisted and significantly increase your training costs.

● How mobile is the solution?

I would say, if at all possible, find solutions that have mobile apps for Android and Apple iOS today. These are companies that are investing into the future and might bring value and improvements to your business more quickly. Make sure their mobile app is as good as the games you see the younger people playing – there is no excuse for poor usability in a mobile app, so look for the solution that can keep up with the world.

● More for less.

Unless you have been under-budgeting in an area and starving it for funding, you should be able to do more for less in every area that technology touches. For instance, hat the ten-year-old phone system is ever going to be able to compete with a modern communication system that not only emails you the voicemail, but also transcribes it for you. Budgets need not be starving in an area if cost savings are to be found. The same reasonable budget will get you more value today than ever before from a technology solution so consider that in your budgeting process.

● Pay attention to the hidden cost of how pleasant a solution is to use and don’t forget about the deployment and support costs long term.

Your IT support team can help you understand the second support costs but generally more software and less hardware are good starting points. Look for beauty in the solutions you review. At Sinu, we often find that pleasant usability is an indication of deeper respect for simplicity and efficiency in all parts of the solution.