Before Paying for New Tech, Ask These Questions

Every organization needs tech tools to streamline operations, unlock new functionality, and improve profitability. But many organizational leaders get lost in chasing new gadgets and the promise of greater efficiency that they overspend and overcomplicate their tech stacks.

That’s why it’s important to ask critical questions before buying new tech for your business.

What Problem Am I Trying to Solve?

It’s exciting when new tools emerge, especially if there’s a lot of attention around them. The creators of the platform might pitch it as something that could revolutionize your marketing, accounting, inventory management, or some other aspect of your business. And depending on the strength of the demo or trial, you might understand how they could make such a bold claim.

However, before you get too caught up in the new, better-designed packaging, take a step back and ask yourself: What problem am I actually trying to solve?

Products are typically designed to solve problems that aren’t currently being addressed by existing products. Software developers are no different. They’re typically trying to solve various problems with the platforms they create.

If your business begins accumulating subscriptions for platforms that seem to be productive or empowering for other businesses, you probably aren’t going to strike at the heart of the challenges preventing your business from reaching its full potential. That’s why it’s important to know which problems you’re trying to solve before you start considering new software, let alone purchasing one.

What Tools Do I Already Have?

With a better understanding of the problems your business is trying to solve, take a look at the tools you already have. Decision makers sometimes develop blind spots around existing tech solutions, either because they don’t use them on a daily basis or because they overlook underutilized key features.

Taking a close examination of the tools you have means you can identify which problems you’re already solving, the gaps, and the opportunities for new platforms. If there’s too much overlap between your existing tools and your hypothetical new ones, it may not be worth making the investment.

How Much Value Will This Add?

The next question you need to ask is: how much value is this going to add to your organization?

Calculating the value of a piece of software can be difficult. Various metrics can help you estimate the impact of the software, but you won’t have a full selection of data until you use the platform in your specific circumstances. Still, using the information you already have, you can likely speculate about the forms of value that this tool will add to your organization.

For example, will it open the door to new forms of revenue generation? Will it help you drive more business, and if so, how much? Is it going to help you save time?

For each of these questions, attempt to quantify the value in terms of dollars. If this tool is going to generate new revenue, how much will it generate, and how will it do the job? If it’s going to save you time, would this allow you to save on labor costs? Or would it enable some of your valuable employees to better spend their time on more complex problems?

Naturally, it can be difficult to quantify everything, but do your best when making this estimate.

How Much Will This Cost?

Next, think about the costs associated with this new tech. Most software platforms are subscriptions, so you should have hard numbers that allow you to calculate direct costs of using this platform. However, you’ll also want to calculate secondary and tertiary costs.

For example, how much will you pay your IT team to integrate and manage this platform? How much time will you spend on educating and training staff members? Are there any new expenditures that your company is going to take on because of this tech?

Again, quantify everything to the best of your ability so you arrive at a reasonable estimate.

What Is the Overall Projected ROI?

Once you’ve quantified the total value and total costs, you can determine a rough estimate of return on investment (ROI). Hypothetically, as long as this piece of tech adds more value than it costs, it’s going to be a worthy acquisition.

However, a positive ROI isn’t necessarily the best ROI available. It’s a good idea to compare projected ROI of many different tech tools, so you can decide which one is going to be the best fit.

What Other Tools Are on the Market?

No analysis is complete until you also ask yourself about the other tools on the market. The most interesting software might check a lot of boxes, offering an impressive return for relatively low expenses, but it’s possible that there’s something better out there. You won’t know until you look.

What Is the Plan for the Future?

When looking at tech, you should consider the plan for the future, especially if you intend to use this tool for the foreseeable future.

Ongoing Support

Does this software developer or hardware manufacturer have a plan for ongoing support? Are they going to continue supporting this tool for a finite amount of time or indefinitely? If you experience problems, do you have a reliable source of help?

Patches

Cybersecurity is an increasing concern. If you’re purchasing new software, think about how much attention developers are paying to it. In addition to researching security features inherently within the software, consider whether this development team is committed to making ongoing patches when they identify new vulnerabilities.

New Features

Is there a road map for new features and product expansion in the future? This isn’t a strict necessity, but you may prefer having a tool that can grow and evolve with your changing needs.

How Will We Determine the Value of This Tool in the Future?

Finally, consider how you’re going to evaluate the success of this tool in the future. After using it for a few months, or even a year, what metrics will you evaluate to determine whether this tool is worth continuing to pay for? It’s important to have an objective standard, so you can tell whether your investment is paying off.

Most businesses benefit from acquiring new tech at a steady pace, solving problems, and scaling into the future. However, if you want to be successful, you need to ask the right questions before you make your final decision.

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