Tech stacks are often underutilised by companies, simply because they do not know how to take full advantage of the capabilities of the apps available to them. Peter Tahmizian, Chief Technology Officer, Intelliworx, explains how SMEs can make the most of their technology, without spending more of their budget.
In an unstable economic environment, Chief Technology Officers (CTOs) are on the back foot. Boards are cautious about signing up to major technology spend over the next 12-18 months for fear of the economic risks.
Amid this backdrop of caution and economic uncertainty, companies are taking a more nuanced approach to tech spending. While boards may remain wary of committing to major technology investments in the short-term, they are at the same time recognising the need to invest in strategic technology – such as cloud computing, cybersecurity enhancements or other digitalisation initiatives – that align with their long-term goals.
However, small- and mid-tier companies are at a particular disadvantage here as they simply cannot compete with larger rivals on technology spend – budget constraints, limited access to capital and a more risk-averse approach are hindering the ability of smaller businesses to commit to investing in new transformative technologies.
Despite this, small- and mid-tier firms still must find a way to maintain a competitive edge.
Getting the most out of what they’ve got
To keep up with their larger rivals, an increasing number of small- and mid-market enterprises are looking at ‘utilisation’, i.e., getting the most out of what they’ve already got; whether it’s hardware, software, cloud services or human resources.
Utilisation is a strategy which aims to ensure costs are minimised – and pace with rivals is maintained – while return on investment (ROI) remains as strong and predictable as possible.
The main way this is done is by optimising the use of existing technology, whether it’s hardware, software or other digital infrastructure, to maximise value. To make the strategy work, it’s a process of first conducting a comprehensive assessment of all technology assets in the business, before clearly defining the goals and objectives for each asset – which might include improving productivity, reducing costs, enhancing customer service or achieving compliance with industry standards.
Businesses should then look to implement a regular maintenance schedule to keep their tech stack up to date, including software updates, security patches and hardware maintenance to ensure everything functions smoothly.
For smaller firms, utilisation can have a wide range of benefits. This includes cost savings, which is important for businesses with limited budgets, particularly as utilisation can help extend the lifespan of existing tech assets and delay the need for expensive upgrades or replacements.
How CTOs can increase ‘utilisation’
Given the uncertain macroeconomic climate, more and more CTOs are turning to consultants and asking, “What can you do to increase my utilisation?”
CTOs, particularly for smaller businesses, are acutely aware of the strategic need to boost the utilisation of their tech stack. It can be seen as a dual strategy, not only for the cost savings but also to help maintain a competitive edge in a rapidly evolving digital landscape.
Companies are working harder than ever to understand the depth of features, functionalities and capabilities of the technology already at their disposal.
Even amid budget constraints and the trend towards app consolidation, most organisations still have significant tech stacks. Research shows that the average small business with 500 or fewer employees has 172 apps. Mid-market companies between 501 and 2,000 employees have 255 apps on average.
However, many companies are only scratching the surface of what their tech stack can really do.
One of the primary reasons for underutilisation is a lack of knowledge about what an app or tool can do or how to use it.
To unleash the potential of their tech stack, CTOs should commit to training and upskilling their workforce. This can be done through scheduled training, for example, ensuring regular training sessions are held – particularly as tools update and features are added – and staff are kept up-to-speed on all aspects of how their tech works.
Organisations could also look to encourage or even mandate certifications for some of the core tools used by the business. This should help ensure a minimum level of proficiency across the board and enable firms to ensure they are getting the most out of their technology.
CTOs should also consider how they can embark on a programme of integration, exploring opportunities to integrate different systems and tools to streamline processes and improve data flow. Compatibility between systems is crucial to eliminate data silos and inefficiencies, also helping to increase utilisation.
Why small- and mid-tier companies have the advantage
Unlike large corporations, mid-tier firms can afford to pursue this strategy of ‘utilisation’ because, in most cases, they are not burdened with legacy technology systems.
Compared to their smaller peers, large enterprises have, on average, more than 650 apps – many of which can be several years old. This can cause issues with stability and reliability, meaning businesses must spend significantly more than expected to replace and renew out-of-date tech.
For example, the financial services sector is consistently a victim of this problem, where larger rivals must increase their technology spend at a much faster rate than mid-tier players to improve their services and increase market share.
By contrast, small- and mid-tier firms – unburdened by masses of legacy tech across an organisation involving thousands of employees – can facilitate better communication and collaboration, ensuring that employees are proficient in using the organisation’s tech stack. This reduces the risk of underutilisation due to a lack of training or understanding.
Smaller organisations can also take advantage of their typically leaner processes, meaning they’re better able than large corporates to optimise their tech stack to support their core functions, helping cut complexity and increase utilisation.
While larger firms often have the ability to invest more in technology than their peers, small- and mid-sized businesses have the advantage of agility, customisation and a close-knit, collaborative environment that can enable them to make the most of their technology stack. They can leverage these strengths to innovate, remain cost-efficient and stay competitive in a rapidly evolving business landscape.Click below to share this article