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Technological progress may not be so golden for NZ Business

Technological progress may not be so golden for New Zealand businesses

Rapid technological progress may be setting many New Zealand organisations up for future failure as overwhelmed business leaders fail to build IT scalability into their strategic plans.

Chief Executive of New Zealand IT consulting and software development company Designertech, Ray Delany, said today that the IT sector is encountering more and more small to medium enterprises that are not configuring their technology for future growth.

“Admittedly, the bewildering speed and development of technological innovation is a challenge for people in the IT sector to keep up with, never mind non-specialists who probably have to tune-out just to keep from being overwhelmed – the waters are very muddy.

“The result is that that organisations end up caught in The Red Queen Effect,” he said.

In the Red Queen's race in Lewis Carroll's Through the Looking-Glass, the Red Queen asserts: “It takes all the running you can do, to keep in the same place” – meaning that a business must continuously develop just to stay on equal terms with the competition, never mind get ahead.

“But the ability to lead the market and avert a future crisis can be achieved by making sure that the technology a company selects is scalable to the organisation’s future goals. The problem is that so many managers just want the ‘latest’, without planning for how the company should look in three or five years from now.”

Delany said the problem of non-scalable technology and poor planning around growth manifests in a variety of ways. It is not unusual, for example, for Designertech to encounter companies where the technology works well at head office but less efficiently at branch office level.

“People cope with non-scalable technology issues by increasing the level of human intervention to keep things synchronised, such as having staff conduct checks and double checks to verify things are correct. They keep on adding more and more staff, until it all becomes unwieldy and unable to scale with the growth of the business.

“It’s messy and inefficient and it can be fixed by applying true strategic vision along with expert advice. Know where you want the organisation to be in three or five years time and plan for that with what you do now, in terms of technology purchases and infrastructure.

“Sometimes the issue is a reluctance to spend money on expert advice, but it ends up costing more in the long run, or there is a tendency to take the easy option of asking friends and acquaintances for advice, instead of conducting rigorous research and exploring all the possibilities properly.”

Delany advised companies to define their organisation’s priorities and critical functions – with a view to scalability – and work from there.

“Expert, strategic advice on how to achieve the company’s objectives is critical, but be wary of being seduced by the perceived possibilities, potential or opportunities – start with achieving the important basics.

“By configuring your technology to your current situation, without planning for the future, you limit yourself to a certain size and end up missing the real opportunities as a result. Even human intervention as a coping mechanism will only take you so far,” he said.


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