Technology obsolescence is a real and costly problem for businesses. To stay ahead of the curve, it’s important to understand the risks and costs associated with your financial accounting systems becoming obsolete.
This whitepaper will explore those risks and costs in detail, with a focus on how your business can best prepare for and mitigate them.
The Case for New Technology
There’s no question that new technology can be expensive. But the cost of not investing in new technology is usually higher.
That’s because outdated technology can put your business at a competitive disadvantage. Your staff will be bogged down by slow processes, which will make it difficult to attract and retain talent, and ultimately hinder growth.
Technology obsolescence can be defined as the process by which technology becomes outdated or no longer supported. This can happen for a number of reasons, including advances in technology, changes in industry standards, and the expiration of support from the manufacturer.
Whatever the reason, obsolescence can have a major impact on your business.
Many businesses have been slow to adopt new technology.
This is not surprising because every time a new generation of software is introduced, organisations have to carefully weigh the benefits and costs of switching to a new paradigm against the drawbacks of continuing to use an increasingly out-of-date, obsolescent system.
However, with technology changing at an ever-faster pace, the risks and costs associated with obsolescence are only going to increase.
This means that businesses need to be proactive about investigating and investing in new technologies.
The Need to Move
It is safe to say that “the cloud” is the new “la norme” of technology. Thus, there are various reasons why businesses need to move to the cloud.
However, the decision to shift to cloud services—often from a classic enterprise resource planning system—is not a technology decision alone.
The board of directors and senior management need to understand the implications of this move in terms of business model transformation, competitive edge, shareholder value, and so on.
They also need to appreciate that such a shift will require changes in corporate culture, processes, and governance.
The key question for many businesses is not if they should move to the cloud, but when. The answer to this question depends on a number of factors, including the competitive dynamics of the industry, the company’s strategic objectives, and the maturity of its internal capabilities.
However, one thing is certain: businesses that don’t move to the cloud will eventually be left behind.
Rethinking Technology Obsolescence
The concept of technology obsolescence is nothing new. It’s the reason why we regularly upgrade our laptops, smartphones, and other devices.
However, the pace of technological change is accelerating, and businesses can no longer afford to wait until their systems are completely out of date before upgrading.
The cloud is different. It provides a way for businesses to stay up to date with the latest technology without incurring the huge costs associated with traditional upgrading cycles.
Furthermore, the cloud enables businesses to embrace new technologies—such as artificial intelligence and the Internet of Things—that can help them gain a competitive edge.
Exploring the Cost of Technology Obsolescence
Some time ago, we published an article on our official blog titled “What is the Cost of Inaction in Your Business?”
In essence, the cost of inaction is the cost you incur from not doing something to grow your business. It’s the “opportunity cost” of doing nothing instead of something.
Bringing this concept into the realm of our discussion, we can say that the cost of technology obsolescence comes in many forms. Here are 10:
1. Financial costs
When your technology becomes obsolete, you’re likely to incur significant financial costs. To give you an idea, running an outdated financial management system can result in missed opportunities, errors, slow processes, and security risks that can quickly add up. All these can directly impact your bottom line.
2. Lost productivity
Outdated technology can lead to inefficiencies and lost productivity as employees struggle to use obsolete systems that are no longer fit for purpose. This includes wasted time on manual workarounds and waiting for slow systems to catch up.
3. Competitive disadvantage
If your rivals are using the latest technology and you’re not, you’ll quickly fall behind them in terms of competitiveness.
4. Customer attrition
If your customers can no longer use your product or service because it’s based on outdated technology, they will go elsewhere.
5. Reputational damage
When your business is seen to be using outdated technology, it can damage your reputation and make it harder to attract top talent.
6. IT security risks
As technology advances, so do the methods used by hackers and other cybercriminals. By using outdated technology, you’re leaving your business exposed to greater IT security risks.
7. Higher IT costs
The cost of maintaining outdated technology can be higher than the cost of moving to a newer, more up-to-date platform. This is because you’ll need to invest in additional support and maintenance staff to keep things running smoothly.
8. Increased employee turnover
The use of outdated technology can lead to employee frustration and a loss of morale. This, in turn, can lead to a high staff turnover, which is costly and disruptive to your business.
9. A missed opportunity to innovate
If your technology is obsolescent, you may miss out on opportunities to improve your business processes and gain a competitive edge. For example, you may be unable to take advantage of new technologies that could help you save time and money.
10. Risk of failure
Ultimately, if you don’t keep up with the latest technology, your business will become less and less efficient and may eventually fail.
Look Beyond the Cost Savings
While financial savings are certainly a key consideration, businesses need to look beyond this when making the decision to move to the cloud.
Yes, it’s true that the cloud can help you reduce your IT costs, but this is just one of many benefits.
The cloud provides a way for businesses to stay up to date with the latest technology, gain a competitive edge, improve their overall efficiency, and increase agility.
Even more, the cloud can help businesses transform their operating models, culture, and processes. In other words, the cloud is about much more than just cost savings. It’s about transforming your business for the future.
Conclusion: Changing the Cloud Conversation
Technology obsolescence is a real and growing problem for businesses. However, the cloud provides a way for businesses to stay up to date with the latest technology without incurring the huge costs associated with traditional upgrading cycles.
Now is the time for businesses to change the conversation from “if” they should move to the cloud, to “when”.
Moving Forward with FinanSys
We are dedicated providers of Infor SunSystems and NetSuite ERP solutions with a team of certified consultants who pack an accumulative experience of over 100 years in implementing, upgrading, and supporting these solutions.
Our experienced team can help you to migrate your business to the cloud quickly and efficiently, with minimal disruption. You’ve been thinking about this for months; it’s time to action it.
We understand that every business is different, which is why we offer a tailored approach to each and every project we undertake. We will work with you to understand your specific needs and requirements before recommending the best solution for your business.
Why FinanSys Stands Out
- We offer a complete solution – implementation, configuration, training and support, cloud hosting
- Outstanding project track record
- Excellent value with a very lean project delivery approach
- An agile and personal approach to customer service
- 23+ years of experience
- 200+ implementations in 36 countries
- Dedicated public training courses
- Highest ratio of support staff to customers within the financial community
- We push back less on support calls where others might try and flip them into consultancy
- 24 x 5.5 days a week support
- We are a global company – with offices in the UK, Nigeria, Indonesia, the United States, Egypt, and Czechia
- Localised support
- A relatively youthful management team also helps secure continuity of service for our customers
- High customer retention rates
What are the Next Steps?
- Get in touch with FinanSys to schedule a call
- We will listen to your requirements and discuss how we can help
- We will then present you with a tailored demonstration and quotation
Contact us today at +44 (0) 207 456 9833 or firstname.lastname@example.org