Technology and planned obsolescence


blog Very insightful blog post here by Longhaus managing director Peter Carr, who has made a sophisticated argument regarding planned obsolescence with respect to implementing technology in organisations. Carr’s basic argument here is that it’s extremely easy to implement entry-level technology in organisations, but that this sort of strategy can bite you in the long-term if you don’t have a transition strategy. Some key paragraphs:

“When it comes to just about any kind of technology today, the barrier to entry into anything is very low and it is just getting lower and lower. Compared to even 2005, the availability of technology and related services is remarkably high in 2012 thanks to the fast maturity of cloud and the accessibility of internet connectivity. When combined with the self-aware, DIY, or BYOD technology trends, the effects are significantly multiplied. This is of course all wonderful for the start-up or small business but its real impact on determining future success for companies with any greater vision can be significant.

Whether talking about websites or business software or hardware and devices, the fact is that businesses can get “in” really cheaply but all cheap technology services have a ceiling. They have their own style of planned obsolescence and, if not thought through at the point of purchase with the same planned and careful consideration as enterprise IT, will inhibit many small-to-medium businesses in making the transition.”

In the small business world I see this kind of behaviour constantly. Organisations start off by deploying a certain type of technology, at a certain level. Commodity web hosting, for example, for a few dollars a month, or a few cheap desktop PCs or laptops. Even a company smartphone or an early sign-up to a software as a service accounting package such as Xero. But then down the track, as they grow and have new needs, often organisations struggle with taking the next step, whether that be something like shifting your web site to a larger provider, implementing a desktop fleet management strategy, or realising that they need professional payroll software.

In big business, great examples might be the current problems which Australia’s largest banks are having in shifting off their decades-old core banking systems. It often seems as though the cost of migrating off these ageing platforms is greater than the cost to deploy them in the first place twenty or more years ago.

The difficulty is often that, having used entry-level solutions at a certain price point over a prolonged period of time, decision-makers sometimes don’t realise that they need to take a step up to the next level in terms of their technology enablement strategies, in order to fuel their business growth. You get locked in a false paradigm; on the one hand, entry level technology which has worked in the past but is not meeting current needs, and on the other hand the belief that higher-grade solutions are too expensive and out of reach. The solution, as with all false paradigms, is to change the starting point of your thinking.

The reason I liked this post by Carr is that it forces us to consider a very important question when we roll out new technology. We shouldn’t just ask ourselves what a whizbang new technology will do for us, but for how long we can expect it to be useful, before we will need to shut it down and move on to the next thing. It’s a big reality check for the industry. Zen-like, Carr points out a very obvious fact that we rarely consider enough: Technology changes ;)