Part 1 in a 4-part series
Many factors contribute to the growth of a business, and each should be evaluated frequently to ensure they are contributing optimally. This is a 4-part series examining the effect business software can have on company growth.
Business software should increase productivity and profitability. But, like many decisions made by business owners when starting up, the software and systems put in place need to be reassessed as the business evolves.. If not, the result may have a negative effect on productivity and profitability. If the systems are not providing the accurate and sophisticated analysis necessary to grow, the software may actually contribute to a contraction, which may be avoidable if the business owners and leaders routinely evaluate the fit of the software for their current and future needs.
Most business owners would prefer almost any other alternative than migration to a new system. And it’s understandable, to a point. The time involved, loss of productivity, and cost that many have experienced when migrating from one system to another are enough to make anyone think twice about it. However, if your business outgrows your software and you do not address it, you could be posting a going out of business sign on your company.. Patches or updates to software that was not designed for a business of your size will not give an optimal result.
Every business owner would be well advised to thoroughly evaluate the software in use – and do so with some regularity. Not doing so may be causing lower profits and less productivity – and your software may lack the sophistication to report your business results properly. The goal of this article is to explain the reasons you would be well advised to evaluate your business software and systems regularly.
Business Software Selection and Reevaluation
When most business owners start their companies, they choose business software based on one or more of the following criteria:
- Familiarity and experience with the product,
- Ease of use,
- Recommendations from trusted advisors, friends, or other business owners,
- Research they conduct for their decision-making process,
- Support included in pricing, and
- Claims made by the software company.
These criteria may have offered the best result when the company initially started, but after a company has grown – sometimes even after only a short time in business – the software should be reevaluated to ensure that it still supports the business in continuing that growth. We have found that, in some cases, the software in use may never have been sufficient to support the business in the first place. When the software used by a company does not meet its managerial needs, it can cause significant reductions in or limitations to organizational growth. This can be very expensive in the long term. Inefficient, inappropriate, or outdated technologies are a drain on productivity, and can account for tens, if not hundreds, of thousands of dollars in lost revenue and growth opportunity each year.
There are several ways the systems in place may be or may become inadequate for continued growth. These include the inability to measure and analyze your progress, growth, and processes or; the flexibility to assign new task ownership to accommodate (and measure the success of) the delegation of work assignments as your staff size grows.
Jack Bleiberg is a Business Growth and Productivity Expert and CPA who can help you determine if the business software you are using is contributing to your business growth or holding you back. Contact Jack today for a free consultation.