Stop wasting time and money: Guide to managing ‘old tech’ costs

Technology solves problems. However, it comes at a cost. Oftentimes, not all costs are entirely obvious to organizations. The total cost of ownership of technology applications can extend well beyond initial contract values. Maintenance and upgrade costs, for instance, are difficult to predict before they become evident. Also, the cost of maintaining aging technology keeps on rising with time. Just ask the U.S. Navy about that! This is why the USS Oldendorf was decommissioned and is now an algae reef off the coast of Hawaii now. It became too expensive to maintain! Often enough, enterprises are left with applications so old that even the developer company ceases support for it. Any bugs, after that, need to be solved by paying niche developers and consultants. This is just one example. Let’s explore the deeper aspects of maintaining old tech applications in this guide.

Cost of downtime

old tech
Flickr / Robert

The older your tech applications become, the riskier they become. The biggest risk, however, is related to downtime. They cost of downtime, of course, depends on factors such as:

  • The number of employees that use the application.
  • The hourly wage of the users.
  • The costs of activating alternative processes to sustain business continuity during downtime.
  • The loss of reputation among customers, particularly for applications such as appointment booking tools.

It’s clear, downtime costs could run into thousands of dollars per hour. If your old technology apps are also the ones that are mission-critical, it’s time to evaluate their vulnerabilities. Then, build a transition plan to replace them with newer, secure, and more affordable technologies. Also, build parallel capabilities that help you keep the show running during downtime.

Cost of wasted time

old tech
Flickr / GorillaSushi

Chances are you value time. Chances are you bought your tech tools primarily with the impression that they’d save you time.

Chances are they actually did a good job at helping you and your people do more in less time. And, chances are they’re not as effective today as they were five years ago (though that microwave still works!). And that’s probably a good reason to ask yourself — can my business afford to keep on putting up with this wasted time?

Assume your people need to get X amount of work done in Y amount of time. Let’s face it, the generally accepted level of performance of state of the art hardware and software improves with time (X work units get done in less than Y time units). Also, the gradual deterioration of existing hardware and software means that X amount of work will take more than Y amount of time.

The result — the longer you cling on to old technology, the larger the offset between “today’s ideal efficiency” and “today’s actual efficiency” becomes. It goes without saying, this abates individual productivity, causes delays to percolate to every organization level, and, in general, breeds a culture of lethargy. You don’t want a bunch of Homer Simpsons walking around your offices, right?

A telltale sign of old technology causing wastage of time is a consistently upward trend in the number of IT issues and requests being logged by users. A year-long analysis of support requests received from technology towers can help you quickly and accurately identify the biggest time-wasters. Evaluate the five biggest time wasters, and start by replacing those with better, quicker, and more user-friendly tech tools.

Unanticipated maintenance costs

A Gartner report predicts that 80 percent of IT costs occur after the purchase! This means that maintenance consumes a major chunk of the total cost of ownership. This also means that you have a great opportunity of reducing the costs by not letting maintenance get out of hand.

In this direction, a cloud computing-powered Software as a Service model offers a sterling alternative. For starters, you get the opportunity to switch to a better and more upgraded technology without bearing the capital expenditure. The move to a monthly subscription model reduces the barriers to switching technology and vendors. Also, the model is inherently designed such that the vendor will take care of reducing maintenance issues to a zilch.

Remember, however, that cloud-based SaaS solutions and managed OT service subscriptions are not a blanket solution to maintenance costs. Try to understand the internal factors causing regular maintenance hassles, and try to eliminate those. Or, seek active consultation from vendors on how they can help in reducing recurring maintenance costs of technology.

Costs to enable backward compatibility

Old Tech
Flickr / Jesús A. Álvarez

If some of your most widely used tech tools are also the ones from several years back, it’s likely that they pose a lot of constraints in terms of data formats supported, ease of integration and the capability to handle data from latest applications.

The first and natural response of most managers is to look for neat and light tools that can help with things like data transformations, format conversions, middleware to enable cross-application communications, and so forth.

Over time, you’ll realize that the need to keep on patching up gaps in old technologies won’t wane. Instead, you’ll be left with an IT infrastructure that’s overly complex and difficult to support. Whenever you’re faced with the prospect of replacing an old technology with a new one, don’t forget to factor in the costs and effort required to patch the capability gaps that exist in your outdated tools.

Costs of data leakage and security breaches

Enterprises with even the most enviable, state of the art, and super-sophisticated IT application ecosystem and infrastructure are focused on upgrading all systems at first opportunity. The single biggest driver of this behavior is the fear of a security breach. Companies can lose their reputation (see what is happening with Facebook and happened to Kmart a long time ago) and face millions of dollars in lawsuits because of laxity in securing customer data.

It’s a fair assumption that your old tech tools, as well as the processes built around them, will be among the most vulnerable. This is because such applications are not upgraded to be robust against the latest cybersecurity threats. Ask yourself — can my organization afford this risk?

Old tech, new costs

The inertia encountered by organizations in moving from an old tech tool to a new application is not just a matter of convenience. Your old tech throws up direct and indirect costs that you might have been ignoring until now. Don’t commit this mistake anymore.

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