7 reasons why you need software for your business
March 01, 2012
This article discusses what makes any software purchase worthwhile for a business and hence as a software professional how to build products that satisfy those criteria.
Some time back I was talking to a customer, a senior doctor who owns a chain of clinics, who asked me an apparently simple question, "tell me, why should I use any software? My staff can comfortably work with paper and pen, my patients are happy with it, and I am fine too. Why should I complicate things with software".
I wasn't prepared. I tried to answer as best as I could but my answer wasn't convincing. He moved on to a different topic, perhaps out of politeness. But, the question haunted me for quite some time. Not just my software, why should anyone invest their time and energy in using any software?
The short answer from economics is, a business should use a software if it either increases revenue or decreases cost. In other words, it makes them money or saves them money. But, I think, that does not fully capture the concerns of business owners while evaluating new software.
For a business, adapting any new software requires time of their staff in learning the new system. They have a current way of doing things. Change is needed, which is always painful.
New software is adapted by a business because it improves things. But improvement should be substantial to justify the investment of money and time. Either the new software should allow the business to do things they could not do before or were incredibly hard to do. Nothing less than an order of magnitude benefit will do.
Let take an example of billing software. For the staff, using the software requires almost the same effort in data entry as writing out a bill on paper. But it provides some huge benefits. The business can track inventory in real time, accounting becomes super easy and any theft at front-desk can be controlled. Adopting billing software allows the business to do things it could not do before and hence its worth investing their time and money into a good billing software.
Lets consider another example: WhatsApp. Mobiles phones could send messages (SMS) before. WhatsApp is free or cheaper compared to SMS but that is not sufficient. It makes group chat, sending photos and videos very easy which were earlier hard or just not possible with SMS/MMS. That makes it popular.
For a business, the benefits from adopting software can come in one of the following areas:
I wasn't prepared. I tried to answer as best as I could but my answer wasn't convincing. He moved on to a different topic, perhaps out of politeness. But, the question haunted me for quite some time. Not just my software, why should anyone invest their time and energy in using any software?
The short answer from economics is, a business should use a software if it either increases revenue or decreases cost. In other words, it makes them money or saves them money. But, I think, that does not fully capture the concerns of business owners while evaluating new software.
For a business, adapting any new software requires time of their staff in learning the new system. They have a current way of doing things. Change is needed, which is always painful.
New software is adapted by a business because it improves things. But improvement should be substantial to justify the investment of money and time. Either the new software should allow the business to do things they could not do before or were incredibly hard to do. Nothing less than an order of magnitude benefit will do.
Let take an example of billing software. For the staff, using the software requires almost the same effort in data entry as writing out a bill on paper. But it provides some huge benefits. The business can track inventory in real time, accounting becomes super easy and any theft at front-desk can be controlled. Adopting billing software allows the business to do things it could not do before and hence its worth investing their time and money into a good billing software.
Lets consider another example: WhatsApp. Mobiles phones could send messages (SMS) before. WhatsApp is free or cheaper compared to SMS but that is not sufficient. It makes group chat, sending photos and videos very easy which were earlier hard or just not possible with SMS/MMS. That makes it popular.
For a business, the benefits from adopting software can come in one of the following areas:
- Automation. Something that was tedious to do, was error prone, or needed unnecessary employee time can becomes automatic and error free. Like the billing software example mentioned above.
- Efficiency. Software can make things fast. May be your customers don't have to wait or your staff work load is reduced.
- Prevent theft. Manual system is often too easy to manipulate either by staff, or customers or suppliers. Adding software creates fingerprints and hence makes the process more transparent. Unfortunately, many businessmen want to manipulate their own accounts (for tax evasion). But by leaving the system manual, they leave it open to manipulation by anyone, including their staff also.
- Scale easily. When you are growing from one branch to several, only your systems and processes carry over. Everything else, including your staff, location, customers etc. will be new. So, it is important to build a good robust system from start. Software is integral to building a fool-proof system.
- Remote monitoring. As the owner you want to know things are running well. And in case there is a problem, it should be brought up to your notice as soon as possible. Brushing problems under carpet by the staff should be hard or impossible. Software brings everything on your fingertips. You can check current status of your business and spot any problem quickly. Its like having a CCTV which warns you automatically when things are not normal.
- Provide insight. Software generates lots of data as it runs and analytics helps you see trends and patterns in your business. You can use this new knowledge to allocate resources effectively.
I think for a new software to be worthwhile for a business, it should satisfy a least few of the above criteria.
Here are some other articles which talk about this topic:
- How to find types of software which people will use and pay for.
- This article says individual user experience is important. Either the use experience of the customer or the CIO or the business head buying the software (its a little cynical). Their experience in the purchase is important - enjoyment of sales process and whether they will get to protect their job
- Build vs Buy - once you have decided you need a software, how to decide whether to custom build it or buy a standard version