Technology costs and where it’s worth your business spend
The modern business world is epitomized with advanced technology disrupting new terminologies such as the Internet of Things, systemized operations, big data analytics, artificial intelligence, blockchain, FinTech, augmented and virtual reality. The global business environment is severely connected with these disruptions smoothing productivities for business corporations. Generally, despite the substantial IT costs a business has to incur in terms of system implementation and maintenance, in analyzing the respective costs against all the other expenses the companies spend, investment in IT generates long-term benefits.
A management information system is broadly used by businesses mainly through Enterprise Resource Planning (ERP) software, E-Commerce sites, Office365, Customer service software, Social media sites, SEO, and content marketing. For instance, implementation of an ERP would cost a business approximately $150,000 - $750,000. Further to this, maintenance of these systems would further include maintenance, IT specialist, and security costs. Moreover, businesses undertake the risk of system failure, loss of data in transmission, and cyber threats. However, this risk is worth in comparison to productivity gains a company would benefit in both short and long-run.
IT has revolutionized business operations, especially with the recent pandemic outbreak increasingly growing the demand for the greater need of network connectivity due to work/study from home culture adaption. Hence, any business even the smallest retail shops gradually embraced e-commerce technologies to outreach to newer markets and customers and use POS systems to enhance productivity and operationalize the transactions. The modern world heavily uses FinTech, Bitcoin, and virtual wallets to do transactions. Furthermore, the use of online payment facilities such as e-banking and other transaction platforms has significantly reduced the traditional costs required for the maintenance of physical banks and stores.
As a business has an ERP implemented, customer purchase orders and invoice management, inventories linked to production, and customer service management are processes streamlined. Furthermore, HR systems that capture daily attendance, computerized payroll systems help save substantial administration costs that use labor skills in previous days. The world is occupied with various business corporations that operate simply through the use of technology such as Uber and Airbnb with no physical maintenance or ownership over inventories.
Businesses require to make a conscious decision to make the appropriate IT investment decisions that help increase efficiencies and effectiveness of the company minimizing the use of excessive labor involvement. Especially areas where managers have to micro-manage business could choose to implement technology enhances systems to streamline the processes. Technologies assist to minimise costs, wastages, and damages caused by theft and malpractices happening in business operations.