According to Gartner, global IT spending is projected to reach close to $3.8 trillion in 2019, a 3.2% increase from 2018. A key driver of this growth will be cloud-based enterprise application software, spending on which is expected to hit $466 billion by 2020.
“IT is no longer just a platform that enables organizations to run their business on. It is becoming the engine that moves the business,” said John-David Lovelock, research vice president at Gartner. “As digital business and digital business ecosystems move forward, IT will be the thing that binds the business together.”
As enterprises continue to align their digital transformation efforts, many are shifting away from software ownership to software-as-a-service (SaaS) models, which better equips them to pivot more nimbly and adapt to the rapid change that characterizes digital business.
But this increase in IT spend can also lead to waste if not properly managed. In fact, it’s a pervasive problem among organizations around the globe. According to one five-year study of nearly 150 enterprise companies across 16 industries, software waste costs reached $34 billion or approximately $247 per user. This was software they either paid for and never used or didn’t use it to its fullest capacity.
It’s something we see frequently. Organizations invest in tools such as a CRM like Salesforce with the best intentions of using it to streamline operations, only to have it remain largely unused six months to even a year or two down the road. Why is this so common, what threats does it pose (beyond a wasted investment), and how do you avoid it?
Why software investments go unused
There are a number of reasons software waste is so prevalent. Among the most common include, not having the internal infrastructure to support the implementation of the software, not setting goals and a vision for how it will be used to achieve specific business outcomes, and finally is a lack of technical skills among the staff.
Luckily, over the past several years, organization’s have been allocating budget to marketing and customer experience teams to invest in the specific tech that will best match their workflows. However, it’s not uncommon for Additionally, they often have limited bandwidth as the integration is placed on top of their existing duties. In the interest of getting it done, they may not take the time to collaborate with end users to understand their needs, resulting in software that doesn’t align with the end user’s workflow and thus a lack of adoption.
When it comes to Salesforce, or any CRM for that matter, one of the most critical first steps is to define your organization’s purpose and vision for it. When this is clearly defined, it will ensure the deployment is aligned to business goals and also communicate to the team why this software is being implemented. When they can see the vision and the “why” behind it, they’re more likely to buy-in to using it.
Finally, many organizations simply struggle with lagging technical skills among the staff. With technology evolving at a rapid clip, this is becoming more commonplace. In fact, the same Gartner research found that skills among internal staff are beginning to lag as organizations adopt new technologies to drive digital transformation.
“Nearly half of the IT workforce is in urgent need of developing skills or competencies to support their digital business initiatives,” Lovelock said. “Skill requirements to keep up, such as artificial intelligence (AI), machine learning, API and services platform design and data science, are changing faster than we’ve ever seen before.”
The true costs of software waste
The cost of software waste extends well beyond the money invested. It can cause organizations to fall behind the competition, create more silos within the company, decrease productivity and efficiency, and even have a negative impact on employee morale.
Often when employees feel they don’t have the tools necessary to do their job efficiently, they’ll find their own apps and software. This can lead to various teams within the company using an assortment of tools, which can create silos of data. This, in turn, can decrease efficiencies and lead to frustrations.
How do you avoid this fate when investing in new software like Salesforce?
1. Include your team in defining the purpose and vision.
When developing your vision, include all stakeholders not just the IT team or C-suite. When those who will be using the software contribute their input on how it can be used among their team or within their departments, they are more likely to advocate for its use. Plus, it will be more aligned to their workflows and specific needs, which also increases adoption. Additionally, you might work with an external partner to conduct interviews with your various stakeholder groups to better understand the need and provide unbiased suggestions on which apps and integrations will be needed to achieve the desired business outcomes.
2. Develop a plan for change management.
Have a detailed plan in place for how the new software will be rolled out across the company. Document key processes the software will support and appoint a team member to oversee the roll out. This person will be responsible for addressing issues and answering questions.
3. Plan to train early and often.
Don’t assume your team will be able to pick up this software overnight or figure things out on their own. With technology changing so rapidly, it is imperative to have an ongoing training program in place. This will help ensure a successful on-boarding, increase adoption, and support goals. After all, the whole reason for implementing the software is to improve a process, so train the team on how you want it done.
4. Enlist internal ambassadors and software managers
Change can be a challenge for even the most agile teams. Plan for an adjustment period, which can be shortened by enlisting internal ambassadors or champions who understand the software and have bought-in to the vision for its use.
Finally, software is constantly evolving and cannot simply be set and forgotten. With Salesforce, for instance, there must be a plan and team in place to maintain it, and swiftly and proactively work through issues before they become full-blown problems. Your Salesforce also must adapt and support your organization as you grow and evolve. This should be true of any software you invest in.
As such, you will need someone to maintain and manage it. This can either be an in-house team or an external partner –– often referred to as a managed service provider (MSP).
Key takeaways: Before investing in software, understand how it will support overall business goals and outcomes, have a plan in place for rolling it out from start to finish, involve all stakeholders in the process, make plans for ongoing training, identify how it will be maintained and who will be responsible for it.
For more on this topic, download our guide, “How to Get the Most Out of Salesforce,” which includes a comprehensive step-by-step on how to build the right team to ensure a successful implementation and handle ongoing maintenance.