The Future and Failure of Technology

In most instances, the technology utilized by an insurance company may not offer all of the features and functions that are ultimately required by the individual business. Despite the fact that technology should be able to respond to controller demands, it is more than likely that the technology most insurers are using is not advanced enough to respond to such requests. However, it is important to remember that the onus is on the businesses to fully understand the available tools.

In most knowledge-worker businesses, technology is the third largest operating expense and these costs are often dramatically understated on the financial reports. Technology is expensive and it many argue that the cost of technology is three times the amount noted on any invoice – reflecting a truly intensive investment.

VIRTUAL RISKS OF TECH TOOLS

Technology comes with risks. Many businesses experience server failures and immediately wonder if their server backup will be functional. Unfortunately, at that point the question is too late and this preempts a scary situation – especially when the odds of surviving a complete data loss are statistically very low.

Technology is also usually too slow. Performance is the most maligned issue for end users. While many are not sure how to quantify just how fast a system should be, there is a generalized principle that computers should be waiting and ready for their input, not the other way around. It is important to note that if a business is dealing with high workload, slow systems can ravage operations – sluggish systems cost money. There is a measurable impact on the bottom line in unnecessarily lowered productivity and the associated opportunity costs.

In addition to concerns regarding cost, system downtime and poor performance: most businesses also have some very serious security challenges. Many brokerages deal with viruses sweeping through their networks and in most instances, a virus that takes hold of a network creates two days of complete network downtime. Many companies feel they are safe, but they are not. In addition to viruses, there is a whole category of malicious code that can damage a system and information, not to mention hackers and disgruntled staff.

Another major challenge many businesses face is the speed of technological change. Technology available today is technically already obsolete – manufacturers just have not been able to bring the new gear to market yet. Businesses are frustrated by the number of new releases, new patches and new updates that they receive or are “encouraged” to install by various vendors – Microsoft, anti-virus companies, brokerage management system vendors etc. Although there are new functions in the applications that may be desirable, often times they do very little for the result. The challenge is that the pace of new updates is rapid and this is compounded by the variety of updates and upgrades that are required from the many software suppliers that influence businesses

Technology is one of the biggest business expenses – costing three times more than most companies initially anticipate – but current models are often too slow to properly serve a high workflow company that relies on expediency for profit. Additionally, many companies are afraid of system failures, a concern exacerbated by the fact that technology changes at a pace that does not allow companies to learn how to properly and fully utilize the tools at hand and thus implement the property measures to protect and secure their electronic data. Therefore, it is clear that businesses are not experts on the operating mechanism powering the electronic keepers of their data powerhouse and they should not have to be experts.

TECHNOLOGIST’S IN TRAINING

A company should be able to count on the reliability of its network: connect from anywhere to access the information that is needed; rely on the security and integrity of the business information; make technological upgrades and adjustments with agility; respond to client inquiries quickly; share information internally in real time; and, accurately report on the progress of the business.

The problem is that in the ever-changing world of technology, the reality is you cannot have all of this unless the appropriate amount of time and work force is allocated toward understanding the function and intricacies of the tools in use.

A top network may be in operation, but a business will not be able to access its full service potential unless there is a shift in how that business thinks about technology. Most of us know there is capability in our technology, the challenge is figuring out how to access it.

Consider this scenario: Would you buy real estate you know for a fact would lose you money every month and that would be worth less than 10% of what you paid for it within five years? Most likely not.

Technology in most businesses is like a bad real estate deal – however, a business’s expenditures continue to be poured into the technology sector. The time is ripe for this to change.

Do people resist change – yes; does technology do what it is told – yes. So, now is the time to begin bossing technology around. If human nature was a farce, and employees instinctively were wired to do exactly what they are told, without resistance, than productivity would be the norm. While human nature is not apt to change, technology is so logic says enforcing your power on technology – control it, do not let it control you. A few fundamental tactics will help any business along their battle for the technological throne.

INVENTORY

The starting point is knowing what tools are available. A business needs an inventory detailing its computer equipment, software and licenses. Inventory provides an up-to-date summary of: what is actually being used to deliver business results; what exposures the company faces; and, insurance issues and planning. Another useful tool is a network topology or map which will make it easier to talk about systems and additionally, help technical staff understand their respective companies network faster. Prepare a summary of all systems and watch how your understanding of the computer network starts to shift.

COST OF OWNERSHIP

Invest time towards understanding what is actually being invested into the computer systems. This exercise takes a little bit of work, but is very powerful. Knowing the costs of the computer network delivers real information for planning and budgeting. To start, simply list everything that the business has purchased, what the monthly support fees are, training costs (including the hidden on the job training), communication costs, time spent managing systems, consumable item costs such as print ink, toner, backup tapes and CDs. Gather this information for a three year period and soon it will start to reflect the flow technology cost expended by the business. This baseline is critical to understanding what the business commitment to technology has been to date.

COST OF DOWNTIME

Understand the cost of system failures. A simple way to arrive at the cost of downtime is to take the total salary, benefits and operating overheads for the year and divide by 1840 (which is the average number of hours a year an employee works) and that provides the business cost per hour. To address the opportunity cost, take your commission income for the year and divide it by 1840 so that you illuminate what the business may be losing for every hour of downtime. By combining the hourly cost of downtime and the opportunity cost, the business will have good picture of what the impact of a business interruption is and can be used to help set reasonable budget numbers for system fault tolerance.

These three examples are just a small glimpse of what makes up a bigger framework for thinking about technology, but when they are applied, perspectives begin to change – decisions will increasingly be based on facts, rather than stories, and shif ting into a better position of control over your systems.

Businesses are in line to being bossing technology around. Change the way your business thinks and technological profit will skyrocket.