This one actually ties in quite nicely to Mistake #3 (Going Cheap), although it may be the chicken and the egg syndrome - not sure which comes first. Are you going cheap because you're overextending the lifecycle of your technology or are you overextending the lifecycle of your technology because you're going cheap? Because many businesses tend to "go cheap", their first inclination is the old adage, "if it ain't broke, don't fix it". With technology this actually turns out be a more costly approach.
I'm big on analogies and I think all too often too many people think that technology is like operating a car. If you're driving along and it stops working, you simply pull over to the side of the road like you ran out of gas. No big deal. But really, technology is actually more like flying an airplane. You simply can't afford to run out of gas - it's life threatening. While I get that server crashes, data breeches, and downtime certainly aren't exactly life threatening situations (for the most part), they could actually be very threatening to the life of one's business. It's been said that 50% of businesses who suffer a significant data loss are out of business within a year.
Way too often we've seen clients pushing the envelope on how long they keep technology in production (see my blog post on the Really, Really story). These are usually NOT the Best in Class performers in their industries. There's a reason why Dell warranties servers for only 3 years out of the chute. They know their own failure rates. Beyond the cost of dealing with picking up the pieces after a crisis, most of these companies don't realize (or want to even consider) the performance gains by replacing 3 and 4 year old equipment. Because technology continues to improve exponentially, 3 to 4 years is an eternity in performance gains. Just because something's "still working" doesn't necessarily mean it's as effective or productive as it could be - which actually decreases staff productivity. Increasing the performance of a staff member by 5% by upgrading their workstation can bring about a 200% return on investment in a year. Unfortunately, most business owners don't factor the hidden costs into the equation as much as they should.
The most effective businesses leveraging technology these days ALWAYS have a proactive approach to their technology. And overextending the technology lifecycle is NOT a proactive approach. Like I said, you can view technology as though it's like a car or like a plane. It's your choice. Just make sure you pack a big enough parachute if you choose to fly.
This one actually ties in quite nicely to Mistake #3 (Going Cheap), although it may be the chicken and the egg syndrome - not sure which comes first. Are you going cheap because you're overextending the lifecycle of your technology or are you overextending the lifecycle of your technology because you're going cheap? Because many businesses tend to "go cheap", their first inclination is the old adage, "if it ain't broke, don't fix it". With technology this actually turns out be a more costly approach.
I'm big on analogies and I think all too often too many people think that technology is like operating a car. If you're driving along and it stops working, you simply pull over to the side of the road like you ran out of gas. No big deal. But really, technology is actually more like flying an airplane. You simply can't afford to run out of gas - it's life threatening. While I get that server crashes, data breeches, and downtime certainly aren't exactly life threatening situations (for the most part), they could actually be very threatening to the life of one's business. It's been said that 50% of businesses who suffer a significant data loss are out of business within a year.
Way too often we've seen clients pushing the envelope on how long they keep technology in production (see my blog post on the Really, Really story). These are usually NOT the Best in Class performers in their industries. There's a reason why Dell warranties servers for only 3 years out of the chute. They know their own failure rates. Beyond the cost of dealing with picking up the pieces after a crisis, most of these companies don't realize (or want to even consider) the performance gains by replacing 3 and 4 year old equipment. Because technology continues to improve exponentially, 3 to 4 years is an eternity in performance gains. Just because something's "still working" doesn't necessarily mean it's as effective or productive as it could be - which actually decreases staff productivity. Increasing the performance of a staff member by 5% by upgrading their workstation can bring about a 200% return on investment in a year. Unfortunately, most business owners don't factor the hidden costs into the equation as much as they should.
The most effective businesses leveraging technology these days ALWAYS have a proactive approach to their technology. And overextending the technology lifecycle is NOT a proactive approach. Like I said, you can view technology as though it's like a car or like a plane. It's your choice. Just make sure you pack a big enough parachute if you choose to fly.
Craig Pollack
This mistake is one of the hardest for some clients to get past. Some don't get past it until they get burned by it themselves, while others may never get past it. I'm a big believer in "you get what you pay for" and this turns out to be no truer than when spending on technology.
I've seen it happen way too many times - clients with the best of intentions trying to save money only to end up spending more (and sometimes way more) in the long run. Whether it's for hardware, software, or services cutting corners is NEVER the way to save money in the long run. Almost every time a client tries to take a shortcut, it comes back to bite them. Rather than pay to extend a server warranty (which may turn out to be like $150 / year), a client ends up scrambling to replace the hardware when it fails paying more for the replacement parts, taking longer to get the parts in, and costing them thousands in downtime and lost productivity. Trying to save money by not keeping systems patched and up-to-date results in workstations laced with viruses which end up costing exponentially more to fix. Working with a lower end company because their rates are $10 less an hour but end up spending more time to fix problems results in higher support fees. Reducing service fees by utilizing a "do it yourself" mentality, only delays the pain - and usually turns out to be (significantly) more costly cleaning up what wasn't done right in the first place.
Now don't get me wrong - I’m not saying that everyone should spend without any concern for cost. This would be ludicrous. We all have budgets to work with and to make any business profitable we always need to control costs. However, I am saying that going cheap clearly costs you more in the long run. There's no doubt. We've seen it way too many times for it just to be anecdotal evidence. Again, you get what you pay for. If you go cheap, you will feel the pain.
