Leveraging Technology in a Challenging Economy

Technology can be a funny thing. On one hand, when there is extra money available, companies can't seem to buy enough technology. When money is short, companies will do everything they can to avoid purchasing technology. Ironically, this is the exact opposite approach that should be taken.
Having run a business for the better part of 18 years the time we find new technology the most helpful is when money is tight. How could this be you ask? Simple. Technology should always create revenue. This can be done in one of two ways.

1. Technology can reduce costs (i.e. doing more with less)
2. Generate additional revenue.

I'm sure you are thinking "that all well and good, but if I don't have money to buy anything, what am I supposed to do?!?" Actually that question is really part of the problem.

If you have don't have money, you need to generate more money by either cutting costs or raising revenues. Most companies, even Cisco Systems (a company we represent), offers an amazing array of financing options including 0% financing options. So really what you end up with is a very pure business equation. Is the amount of money that will be spent per month on technology generate an equal or greater amount of revenue through cost saving or additional sales. ...starts to make sense doesn't it?!?

First and foremost, I run a business. I have always treated internal decisions from the perspective of "if it doesn't make us money, we are not doing it". The trick when making a statement like this is understanding that by financing, or leasing equipment, the monetary impact is spread out over many months. It is unrealistic to think that by purchasing a $24,000 piece of equipment that it will generate savings or efficiencies in the first month to cover that cost. However, if you spread it out over a 24 month period with financing, the effect to cash flow is $1000 per month. Now with this information, the question to ask is...."will the purchase of technology bring us enough revenue gain to cover $1000 per month over the next 24 months?  More often than not, the answer will be yes.  You wouldn't put headcount in your company unless you knew they would pay for themselves over time..... You should ask the same question about you technology decisions.