A full three-quarters of small businesses are in the big gray middle of not liking—or even knowing—their payback from all those tech dollars.

If you’re like most small business owners, you know technology is vital to your success, but you’re murky on the business case to upgrade and expand your software and hardware.

As a result, only 16% of small businesses rate their technology return as excellent, according to a study entitled “The Business Relevance of IT in the SMB Market” by industry group CompTIA. A full three-quarters of SMBs are in the big gray middle of not liking—or even knowing—their payback from all those tech dollars. To get a better handle on your true ROI, consider these questions:

Can I gain efficiencies?


Revenue increases are an easy way to justify investments, but technology improvements usually don’t directly boost sales—they improve efficiencies, which allow workers to increase sales. This may seem like a technicality, but focusing on efficiencies rather than sales usually provides a truer gauge of ROI.

Case in point: Mark Gilmore, president of Wired Integrations, a strategic consulting firm in San Jose, California, recalls a small company that used to meet with customers but had no way to provide the most up-to-date information on the spot. Instead, salespeople emailed large 3D files with the latest data to clients after meetings were over. “Once the company armed salespeople with laptops and virtual connections, information could be accessed in real-time during these face-to-face meetings,” Gilmore says. “It was much more efficient, resulting in more productive meetings and bigger sales.”

How transparent are my measurement tools?


According to the CompTIA survey, most SMBs assess return on technology by using a general cost-benefit template or making ballpark estimates that leave out a lot of variables. A more accurate way to measure technology investments is an ROI calculator. Only one in five small businesses currently use a dedicated ROI calculator, which can create greater transparencies into the true value of your technology spend. When evaluating tech purchases, consider metrics such as the following:

Quantitative measures:

  • Time savings from faster performance
  • Time savings from improved reliability/uptime
  • Direct cost savings (e.g., lower fees, energy savings)
  • Reduction in number of errors or incidents


Qualitative measures:

  • Improved functionality/capabilities
  • Faster or more accurate data/information
  • Increased customer satisfaction
  • Increased staff satisfaction
  • Better compliance/governance


What is the big-picture payoff?


Seth Robinson, Senior Director, Technology Analysis for CompTIA, says companies often fall into the trap of measuring technology by whether it improves current business practices. The overarching question is whether new technology allows you to adopt innovative business practices that create unexpected value, such as leveraging the cloud to allow employees to handle more tasks remotely.

“Initially, the cost may go up with the cloud and other technologies, but you’ll get a bigger payoff in the long run because you’ll be able to do more and work better and smarter,” Robinson says. He recommends that small business owners go beyond a calculation focused solely on cost savings and take a deep dive into how new technology can propel the business in new ways.

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