The risks of new technology – why sometimes it’s better to take it slow

If you’re not on board with the technology revolution, as a business you will be left behind. Most business owners are all too aware of that fact. But with that competitive pressure, and as an increasing variety of new software and technologies come onto the market, it can also be a business’s downfall. 

Cyber security

New and innovative technology might bring benefits but it also brings the risk of the unknown. And nothing shows that more than the growing challenge of cyber security. By 2025, half of all UK businesses will be using only cloud-based services. That means managing a whole new set of risks – around financial data, customer data, and even staff data.

Today, you can’t make something un-hackable. Hackers will get through any firewall. The best way to prevent attacks is to have processes in place to mitigate risk and limit the damage. So for example, don’t pay invoices that are emailed to you without a two person sign off process. Have an internal policy for how to manage company data, who can download it and how it is transferred etc.

Threats are evolving all the time, so your whole team needs to be on board. Every time you hear of some new threat, share that information with your team so everyone is up-to-date with the latest hacks. Clearly share cyber policies with new joiners in their induction, and on an ongoing basis as needed. And when you’re using external developers, ensure they’re coding securely by including clauses in their contracts, asking for warrantees, and reviewing testing and audit certificates.

It’s not just unknown hackers, one of our members’ competitor got hold of their unique HR software IP and replicated it. They ultimately failed to get away with it but only after vast expense was wasted on legal fees. Documentation and proper processes to protect your IP and taking your time to do things the right way, mitigates against growing risks of this kind.

Developing software: Risk vs reward

I can’t count the number of conversations I’ve had with business owners who’ve launched into a new software development project – internally or using external developers – and lived to regret rushing in!

Finding the right developers, not to mention managing them properly, is a huge challenge on its own. But the most frequent problem that I see is scope creep. It’s easy to get carried away with a new idea, want to get in ahead of the competition, and so jump in head first. After all, everyone’s running a tech business these days!

Read: Five entrepreneur goals technology cannot meet

But taking a step back and first scoping out the project and establishing its purpose, is absolutely essential. Look at the ROI – how much time will the new technology save, what revenue will it generate, or what business opportunities will it open up? Is its purpose to create efficiencies or uniqueness? Without a clear idea of what the purpose and value is, tech projects are almost doomed to failure – or at least, major expense.

Training the team

Successful implementation of technology relies wholly on your team using those technologies effectively. Training, on an ongoing basis, and certainly before adoption of any new technology is essential to get any value from that tech, and avoid time-wasting and confusion.

For example, buying a CRM system without first thinking about the data you need to collect (and why), teaching staff how to input data correctly and consistently, and explaining how they can use that data to improve sales, efficiencies or service quality, is a complete waste of time.

If it’s an important piece of technology – as a CRM system often is – the team should also be monitored on how well they use it, and that should be incorporated into their performance or management reviews. Technology doesn’t replace management processes, it needs to be integrated with them to work effectively.

Low tech solutions

Finally, don’t forget the value (and sometimes the necessity) of forgoing tech, and going old-school. One entrepreneur told me about a time a Middle Eastern client of his, who’d recently had new management take over the business, simply stopped paying, inexplicably. It turned out that because he hadn’t ever met the new boss face to face this was deemed unacceptably rude in their business culture, and so the payments were stopped. He flew over, met the new CEO and the problem was resolved within five minutes.

The heart of a successful business is still a great team, and building good business relationships with clients, suppliers or customer. Where technology can supplement that by creating greater efficiencies, great. But technology can also create risk, cost, and inefficiencies and this needs to be weighed in the balance as well.

This is a guest blog and may not represent the views of Virgin.com. Please see virgin.com/terms for more details. Image from gettyimages.

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