4 Steps to Profit-Boosting Tech Innovations That Solve Real Problems

Attend any technology conference, and you’ll quickly be convinced that your business absolutely needs to invest in artificial intelligence, a new ERP, virtual reality, or the latest IoT tool. These are the technology solutions that give businesses a competitive edge—and in today’s market you can’t afford to be left behind. Right?

Except it’s not that simple.

We love technology innovation (obviously) and we would love to talk with you about how a new idea (for example, the Internet of Things) can improve your business outcomes. But we know from experience that innovation only works if it’s what your business really needs.

The truth is, not every business needs a machine learning or IoT solution. Not every business will benefit from a total ERP overhaul or augmented reality. Sometimes you just need a new application or a portal or a behind-the-scenes data solution.

So how do you make the right decision about what technology innovations will benefit your business and which ones are just shiny objects?

Here are the four steps we recommend:

Step One: Know What Problem You’re Trying to Solve

One of the biggest mistakes you can make when choosing technology is buying a solution for what it can do rather than for the problems it can solve. Machine learning solutions may be impressive, but will they solve your productivity problem? Will they help you make better business strategy decisions?

The first step in choosing the right technology, then, is to have a good grasp on the problems your employees encounter in their work each day. That means you’ll need to take the time to talk with employees, listen for their pain points, and identify the underlying problems. Don’t jump to conclusions about what the problems are. Really take the time to listen and understand.

Use surveys, interviews, and focus groups to gather information about problems that need to be solved. Ask questions like these:
* What is the best feature of the current software?
* What is your least favorite feature?
* What do you spend most of your time doing?
* How could new or different technology make your job easier?
* What parts of your job cause you the most frustration?
* Where does technology make your job harder?

But move beyond the survey questions as well, and take some time to observe what happens on a day-to-day basis. You may discover that the problem isn’t access to data after all, but instead a cumbersome process with too many administrative details. Often the problem employees feel is a symptom, not the actual issue, and treating the symptom isn’t going to solve your problem long term.

Step Two: Nail Down Your Budget

Bear in mind that any innovation will have ongoing costs in addition to your initial upfront expense. We encourage companies to consider a three-year window for costs when making a decision. Ask these two questions as you consider cost justification for new tech:
* Will it generate better ROI than our current solution?
* Will we be able to sustain maintenance and support costs over the long term?

No matter how much a particular solution might make your employees’ jobs easier, it needs to answer both of these questions with a yes before you move forward.

Step Three: Find the Right Solution

Well defined pain points and a clear budget lay the groundwork for choosing your solution. Follow up on your discovery process with these questions:
* What technology do we need today to solve our current problems?
* What do we think we will need next month?
* Where do we hope to be six months from now? One year? Five years?

Ideally, the technology you buy today will not only meet your current needs, but will also scale to cover your future needs as well. The temptation when forecasting your needs, however, is to purchase the technology with the most extras because it promises to do wonderful things for your brand/productivity/profit. Don’t fall into that trap. Buy for your needs today and make sure you have a solid tech strategy in place before you purchase the latest and greatest product innovation. And at least consider whether building or buying in phases, rather than all at once, makes the most sense.

With that said, there’s benefit in asking whether a new type of technology innovation could solve your problems more efficiently than the technology you currently have and/or the standard solution. Artificial intelligence, for example, can help you measure employee engagement and design more effective retention strategies. Some companies may be ready to make this shift toward a new, innovative way of managing employee satisfaction. Others may need to implement a more robust intranet or database before they even think about a new engagement application. Knowing where you want to go helps you identify the groundwork that needs to be laid now.

So how do you determine the next step?

Assess your current technology

Can your current technology support the innovations you’re hoping to add, or will you need to upgrade it? Do you have a good data solution in place? Can you retrieve and analyze data efficiently? Do you sufficient security protocols in place? If not, these are the innovations you will want to start with. Don’t try to change too much too quickly, or your technology won’t be able to support the new concepts.

Research your options

What can each function do, and will it solve immediate problems while also addressing future needs? How has the innovation been used successfully in your industry? Should you build a custom solution or purchase one off the shelf?

Ask for advice from peers and experts

Learn which functions have worked for them and what innovations they used to solve specific problems. Ask them what they wish they had done differently and what went really well.

Choose the solution that meets your needs

The best solution isn’t always the one with the most functionality. You may not need all those extras. If you’re building a custom solution, take the time to work through your process and identify which parts need to stay the same and which ones can be reconfigured.

Give yourself the flexibility to innovate

It’s important to choose your solutions conservatively, but it’s also important to allow room for growth. For example, consider artificial intelligence and smart machine capabilities that are leading your industry and build them into your five-year plan if you’re not ready for them today. 

Step Four: Take a Look At Your Business Model

New innovations often require a new business model, or at least updated business processes. Depending on the type of innovation you’re considering, you may need to reconsider your go-to-market strategy, back-office operations, sales process, or manufacturing process. The changes may be as simple as redesigning the way employees interact with one another, or it may require a total overhaul if you will be increasing automation or reliance on smart machines.

Work out the bugs in your current processes before you attempt to scale using a new tech innovation. Identify the key values the solution should bring and make sure you have secured employee and stakeholder buy-in to get the most out of your new tech.

At the same time, don’t fall into the trap of letting new technology determine your business processes. If you change to match new technology, do it intentionally because you know it’s the best path forward for your organization.

Conclusion: The Bottom Line

New tech should always line up with your company’s short- and long-term objectives. Before you move forward with a technology innovation, hammer out your strategy over the next quarter, year, five years, and ten years. Of course, we don’t always know what new opportunities will be available to us in five years, especially in the rapidly evolving world of technology. But when you build innovation into your business model, you’ll be ready to pivot when the time is right.

And if you don’t have the right infrastructure in place? Invest in upgrading the infrastructure now. Moving away from manual processes and spreadsheets will open new doors of opportunity for you across the board.

The bottom line is: Keep track of those tech trends you encounter at conferences and test them to see if they really are the right solution for your company. If they are, implement them strategically. If not, find other solutions that will work for your employees.

At the end of the year, it won’t matter what shiny new tech you added. Instead, you’ll be looking at profit margins and ROI. Make sure the tech you buy will support those broader goals.

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