February 23, 2018 Stewart Marshall

5 Reasons For IT ROI Failures

Alongside yesterday’s post about a under-spending on IT by SMEs, there’s another interesting take away from the Computing Technology Industry Association (CompTIA) with regards to IT return on investment, and this is an invaluable check list for anyone planning their next IT project.

Ongoing maintenance costs/fees [41%]

Unlike assets such as fleet vehicles, software doesn’t physically degrade and hardware should be protected by a maintenance contract. So it’s really only the software portion of a system that is subject to any real change, and this ought to be fairly predictable when assessing it as part of a cost benefit analysis.

If it’s not, business should be extremely wary of the rationale and practices being applied to the purchase.

Required upgrades/built-in obsolescence [37%]

As with the maintenance costs, upgrade schedules and their associated costs should be predictable. They certainly shouldn’t account for over one third of ROI failures.

Staff time needed to operate/maintain [37%] and Complexity / poor user experience [32%]

No IT system should ever be so expensive to use that it defeats its own purpose. How then does a business find itself in a situation where system usability and/or poor training combine to make it economically nonviable?!

Regardless of whether it was built in house or purchased, these were factors that the business should have been able to control.

Upfront cost/too expensive for what you get [36%]

There are many lessons that SMEs can learn from the bigger end of town, particularly when it comes to something like an ERP rollout. But regardless of whether you’re spending millions or $25/month for basic online accounting, make sure you know what you need and what you’re actually buying.

 

It’s easy to blame technology when a system doesn’t live up to expectation, but computers only do what they’re told. More often than not, it’s the business itself that sows the seeds of failure. Inflated expectations, a lack of planning, misguided purchasing decisions and poor implementations conspire to ensure that the business simply shoots itself in the foot.


Today’s Top Takeaway

IT should be an asset. The only time it should be a cost to a business is when it’s poorly implemented.


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