When is the Right Time to Purchase and Implement New Technology?
There comes a time when your commercial real estate business needs to upgrade its technology. Holding out for as long as possible might seem beneficial for your bottom line, but in the end, it’s much more cost-effective to replace outdated and inefficient technology before it winds up becoming a real liability. Deciding if and when to adopt new technologies can be a daunting and difficult decision.
Some consultants suggest that trying to time technology adoption for your business is like trying to time the stock market. They suggest determining whether the particular sector of your business needs innovation, and if it does, start taking the necessary steps to move forward. One option is to implement new technology at the beginning of a new quarter or year, which provides benchmarks for historical data comparison, particularly if the technology involves back-office automation or moving to a new financial platform.
These best practices can help you successfully select and implement new technology into your business:
- Take the time to fully review your current process in the department you are considering implementing new technology. Create an implementation group comprised of key leadership, department leaders and the ultimate current and future end users of the new platform. Without involvement from every facet of the organization, you likely won’t get the buy-in you desire.
- Clear and transparent communication with the entire organization on the benefits of the new technology will also greatly increase the likelihood of a successful implementation. Communicating the benefits to the organization and key individuals involved, and making sure to tie the new technology benefits to specific pain points of those key individuals whose buy-in you need, is crucial to successful implementation.
- Having key company leadership as the champion of the product as well as an early adopter of the new platform may be the most critical to the success of new technology actually being used through the organization.
- Setting realistic expectations on timing of the implementation and training sets the organization up for success. Many implementations fail because the scope of the project was underestimated. Additionally many of today’s cloud-based technologies do not lend themselves to justification in traditional ROI terms, yet they may be essential to a company’s productivity.
Many companies are beginning to realize the limitations of traditional capital budgeting models in analyzing technology investments, particularly in their back offices. Companies are beginning to analyze technology with a focus on human factors, such as job happiness and satisfaction. Recently published articles in Forbes and other noteworthy magazines have stated one of CEO’s top concerns and priorities for 2020 is attracting and retaining top talent.
Another key to a successful technology implementation is understanding and acknowledging resistance that allows leadership to be proactive in dealing with negative pushback from “assassins,” people in an organization who are not supportive of innovation. Those who oppose new technologies typically do so out of fear or concern over loss of ability to perform their jobs with their current skill set, loss of power within the organization, or absence of a true understanding of the personal benefits of the new technology. Meanwhile, “hedgers” are individuals who refuse to take a stand against an innovation so that others can address their objections, but who also refuse to support the new technology.
In many cases, businesses might not even realize how much their outdated technology is hurting their bottom line. How can you know with certainty that it’s time to upgrade your technology? With technology moving at such a rapid pace your technology stack has to be continuously evaluated, and just like a computer, if it’s more than five years old it is likely outdated and needs updating.
Daniel Levison is the Chairman of CRE Holdings (Atlanta Investment Properties, CommissionTrac, Sharedspace). He holds the lifetime distinction of being a NAIOP Research Foundation Governor, a distinguished role that helps shape the Foundation’s research agenda. He is also a member of the NAIOP Industry Trends Task Force. The Industry Trends Task Force’s goal is to identify and effectively communicate to the NAIOP membership any trends that will impact their business in the intermediate to long term (three-to-five years). This committee serves as an early warning system regarding challenges and opportunities for members and provides vision and guidance to the leadership of NAIOP.
Turner Levison is the CEO of CommissionTrac.
