When Improving Technology Makes Things Worse

A Secret

We all know that bad technology is bad for business. By “bad” I mean technology that doesn’t do what it is supposed to do, or which does it wrong, or which costs more to implement than the benefits it brings.

But I’ll let you in to a secret:

Good technology is sometimes bad for business.

Now, I develop software for a living, so I shouldn’t really be telling you that. I should be saying that good technology is a good thing – especially software – and that it will increase your bottom line, make you more productive, make you happier and generally improve your life.

And each of these things is true… but only some of the time.

The Problem

The problem is this:

  • Good technology makes processes more efficient.

At first sight, this sounds like a good thing. To understand why it often isn’t so good, consider two effects that technology will have on an organisation:

Efficiency and Effectiveness

According to Jim Collins (in Good to Great), “great” organizations all employ technologies that enhance their competitiveness. Collins also confirms the role that technology can play if you don’t keep up. However, he explains that technologies are accelerators that amplify the company’s strengths and weaknesses. This means that a company that aims to improve processes by adding technology will magnify both the good and the bad aspects of those processes. In any business area where practices are less than perfect, the imperfections will be amplified by technology. The problem is that making processes more efficient doesn’t necessarily make them more effective.

Lock-In

The other effect of introducing technology is that it can be a hindrance to change. A new software system, for example, can be a very costly acquisition (especially given that companies often underestimate the cost of software). Once the software is deployed, however, processes become locked-in to the way the software operates. Changes to processes often require changes to the software – which can be prohibitively expensive. The result is that the company looses agility, becoming bound to outdated practices that they know are broken, that they want to change, but which are impossible to shed because of technical constraints.

An example of this is the clocking system that was used at a company where I did some work. It was based on decimal hours rather than hours and minutes, so 7 hours and 30 minutes appeared on screen as 7.5. Everyone knew that this was a bad idea, because the entire staff of the company wasted time every month converting their clockings from hours and minutes into decimal hours. However, this method of working was locked in by the technology. When a companion time-sheet system was introduced, the specification indicated that it should also work in decimal hours so it would be compatible with the first system, further locking-in wasteful behaviour.

Conclusions

So, does all this make all technology a bad thing? Not at all. But it does suggest that we approach technology in a different way:

  • Great companies value technology.
  • Technology should not bee seen as a panacea, but a method of amplifying existing practices.
    • Business needs should drive technology, not the other way around.
    • Business systems should be fixed before introducing technology to make them more efficient.
  • Technology should be chosen on the basis of how easy it is to change as well as on how well it meets current needs. For example:
    • Choose an Agile approach to bespoke software development.
    • Reduce dependencies between technologies.
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