There are a few schools of thought when it comes to how you spend your money on IT as a business owner. While it is becoming more and more apparent that spending on technology is a necessity for any business to survive, it’s how you spend it that ultimately matters. Here are the three philosophies of information technology investment, and what they mean for the future of your business.

The way a business manages technology has broad-reaching implications for how their business will thrive. Technological investment is one of the few avenues where a business can inexpensively and measurably enable their employees to get more done in a day. Yet we see so many companies, most companies even, falling victim to the wrong mentality about how technology is managed and nurtured. We have outlined three philosophical categories that most business owners fall into, and what they mean for the future of your business.

Depreciating Asset-  You have a reactive approach to your investment in technology.  You strive to spend as little as needed in your infrastructure with a hope that these costly and completely discrete investments will get you by for as long as possible.  Your company’s infrastructure and productivity gradually erode as you continue to invest the same amount of money each year into your technology with no idea how to make things better.  Technology projects are continuously put on hold because management does not have the bandwidth to manage them AND the day to day operations to drive revenue.  You sit back and watch as stacks of clutter build up around you with no plan on how to dig yourself out of the technological hole you’ve created. 

These companies inevitably get pushed out of business because all they have focused on is surviving and they cannot compete with even the simplest of competitors that have figured out how to maintain their technology so it does not damage their overall productivity.  This behavior is the equivalent of going to your financial advisor and expecting a LOSS.  Not only expecting a loss but making it a goal NOT to make money on your investment. 

Cost Center-  You view your IT department as a cost center.  You are willing to make investments in technology as long as the direct result is that employees can do their work (without consideration to productivity) and that you are not at any major security risk.  While this seems to make sense, you have no real idea of how these discrete investments are negatively affecting your overall infrastructure.  The reality of the situation is that you are continuing to dump money into your IT infrastructure, but only to PREVENT a loss in production or a major catastrophe with no real thought going to how you can improve your systems in order to drive company goals.  While you are not going to lose to the depreciating asset company, you are still fighting for scraps at the table with no real potential of ever truly competing outside of your current customer base.  This is the equivalent of going to your financial advisor and giving them your money and telling them that your goal is to cover the cost of inflation and fees and that is it. 

Appreciating Investment-  You have made the decision that you want your technology to help drive business.  You have a team in place that has provided you with a competitive advantage in the marketplace. The competitive advantage is that this team is efficient enough at performing the functions of your IT department (day to day support, security, stabilization) that it can help you focus on the revenue generating aspects of your business. They provide vital data about your technology to help drive better decision making and help prioritize the projects that will have the most impact across the company.  They have instituted a Project Management System that sets clear, tangible deliverables for each project and can be monitored by all stakeholders as projects move through each stage of the process.  If you can partner with the correct team and this relationship functions appropriately, you will knowingly be investing in your IT infrastructure in the exact way you intended, ultimately optimizing the productivity and profitability of your system.

These are the companies that grow.  These are the people that find the financial advisors that best suit their needs and risk tolerances, and ultimately appreciate their wealth.  These are the business owners that can effectively run a company with the focus of creating value in what they have and scaling that value to grow and succeed.

Which one of these business owners are you?  If you are a depreciating or cost-center owner, how do you begin the process of moving in the other direction?  These are challenges that every business owner faces every single day.  The first step towards moving in the right direction is seeking out a partner that understands the issues and can help create a path forward in an intelligent, informed and processed manner. And that’s Upward Technology. Contact us today!