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Business Adoption of Information Technology: Why most Small Businesses fail at it

Business Adoption of Information Technology: Why most Small Businesses fail at it

Bill Gates once famously said that the first rule of technology is that automation incorporated into an efficient business process would magnify the efficiency. However, the second rule is that automation applied to an inefficient process would also magnify the inefficiency. Most small business owners intuitively know this. If this is the case, then why do so many small businesses continually make the mistake of adopting technology that is doomed to fail? The reason is complex. In my years of information technology consulting specifically targeting the small business sector, what I have learned is that small business owners do not like to admit that their business processes are inefficient, that they lack an understanding of automation, or that their business process could use an upgrade. Additionally, they see technology as a solution.

This last concept is the root of most of the issues involving the adoption of technology. Technology is a tool that organizations and individuals need to use properly to be effective, not a solution that can solve anything. To use any tool properly, such individuals or organizations need to have working knowledge of that tool or instructions on how the tool is to be used. Therefore, there are three elements at work here: the tools, the people, and knowledge. All three must align for a successful outcome. Think about the process of hanging a picture frame on the wall. The job is clear: to successfully hang the picture frame. As a tool, you will need a hammer and a nail. To use a hammer and a nail, you will need a person who understands how to use such tools. If these do not align, the objective will either fail initially or fail when the picture frame comes crashing down because of bad execution of the job. Technology is no different!

So what steps can a small business owner take to ensure successful implementation of technology? The first step is to take inventory. What tools can the organization count on? What people are at the organization’s disposal, either internal or external? What knowledge does the organization possess? Once the organization knows what it has, it is easier to determine where the company stands. Here is where it can get complex. What are the organization’s strategic objectives and goals? Essentially the question is does the business have a business plan? If the answer is no, please stop reading on focus on that now! Technology is a tool and as a tool, technology will SUPPORT organizational strategy and assist in executing a business plan. The lack of a business plan means that there is no clear organizational objective to support. Therefore, any technology implemented is doomed to fail.

Once a business plan is understood and a strategic objective has been organizationally institutionalized and communicated, the organization must look for available tools that can help execute the strategic objective of the organization. Does the technology tool chosen align with what the organization wants to accomplish? Will the nail and hammer be the tool that helps hang the picture frame? This is where everything gets tricky. The correct tool is one that helps accomplish organizational objectives. However, is the organization ready to use that tool? Does the organization need training or assistance in adjusting business processes? Is the business process under which the tool will operate efficient enough or will using the tool simply “magnify inefficiency?” Once the right tool is selected, is there a working knowledge on how to use the tools? If not, experts in this area will need to be consulted.

Ultimately, this article leaves more questions than answers. The purpose is not to solve all issues and answer all questions, as the topic is much more complex and broad than initially imagined. The purpose, however, is to leave small business owners questioning how they accomplish business tasks, questioning the tools needed and currently used, and understanding a fundamental truth of technology: success requires the alignment of the right technological tools, the right people, and knowledge.


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