The Tech Trap: Why Not Every Business Problem Needs a Software Solution

Informed decision-making and risk mitigation.

Sometimes I may come across as “anti-technology” technology consultant, convincing you that the considered project is not really needed and won’t address the problem fully. I see warning businesses about bad investments as an ethical responsibility, especially in the era of technology fear marketing and sweeping promises.

And there are so many promises.

Tech industry is quite good at marketing developed capabilities as solutions to any possible problem. Sometimes the problem may not even be something you need to solve (also known as “solution in search of a problem”). The idea of fixing every business issue by simply purchasing SaaS subscription is very attractive and it’s difficult to be skeptical after inspirational software demos.

To be fair, technology delivered some amazing solutions, completely changing how business is conducted in so many industries in just few decades time. What I am advocating for is a healthy skeptical approach as a counterweight to “just add software” stance.

Reasons for healthy skepticism

The tech industry reputation

Software (and digital) projects failure rate is one of the highest in any industry.

After the hight of blockchain investment hype, 90% of projects had failed. In a few years we will get a better picture on AI investment success statistics but so far the failure rate hovers well above 70%.

ERP implementation failure is often quoted between 50% and 75%.

It’s quite prudent to be skeptical. That doesn’t mean going back to doing business with pen and paper (although I did have conversations with few business owners whose distrust in technology was that high) - but ensuring the best return for your investment is just good business.

Not every business problem is a technology problem

Organizations are complex organisms.

Breakdown in communications, insufficient training, motivation, interpersonal dynamics - these human issues cannot be solved by purchasing a Slack license. A bad product/market fit cannot be fixed by buying the latest CRM.

Operational bottlenecks, lack of clarity on how things are getting done and by whom, redundancy and inefficiency require org-level change, not a new ERP or process automation.

When technology is sold as the ultimate solution, wrong problems are getting solved.

Not every promise is fulfilled

The real world is messy, chaotic and unpredictable. Software demos are professional, scripted and perfect. Sometimes the sales team may not be aware of technology limitations, in other cases your specific business edge case was never planned for or even encountered.

If you are not skeptical, it’s easy to place high hopes on a product that simply cannot deliver.

Fear marketing

Every few years a fear marketing campaign tells you that unless a brand new technology is implemented immediately by your company, it will be doomed and bankrupt.

Tech industry is really good with this messaging. The media coverage helps to spread and reinforce the perception and soon your own customers start asking how are you planning to use ABC tech in your own operations.

Nobody wants to be next Blockbuster, but it took years for competitive advantage to compound to a real damage.

I would advise to counter fear marketing with developing internal innovation lab where your company can experiment with every new technology, learning how it works and how it may be added to your toolkit of solutions.

It may turn out to be a game changer - or a dud. It pays to be quizzical and informed.

Overdoing technology adoption

I could write a paragraph about how wasting budgets on something that does not solve your issue is bad. But there are more human-focused downsides.

Your team is already overloaded

Any introduced change requires adjustment. And with tech innovation cycle speeding up, change is happening much more often.

Consider what adding a new piece of software does to the team.

They need to find time to learn a new tool (quite often without provided training), then rework their established daily process and come up with efficient workarounds when the tool doesn’t do what they need it to. All of this happens while business is run as usual, so it’s a new extra load.

If the team does not see the direct benefit from using the software, the learning curve fatigue will quickly set in.

Your customers are not guinea pigs

People do not like change. Especially if they developed a muscle memory on how to do business with your business.

Go to any grocery store after remodel or reorg and observe how unhappy everybody is with wasting time trying to locate their usual staples.

Change that makes life better is easier to appreciate. If your shop only ever offered call-in for orders and you introduced online ordering, that’s a great addition for the customers. Changing flows and interfaces and shoehorning AI that does not bring true value is not.

Your customers want to talk to a human

Adding a chatbot to your website and outsourcing a customer service feels like a good business decision. But people want to talk to other people when they have a problem (and when they don’t, it’s so much easier to self-serve through the thoughtful website navigation and FAQ sections).

Klarna should serve a real world case study on automating customer service - a decision that was reversed after customer backlash.

Automating a bad process makes it worse - and quicker

Adding automation to something that doesn’t work well makes it fail more efficiently while adding complexity. Over-automating creates a situation where operations are fragile and expensive to adapt to everyday changes.

A problem that is still not solved

The most important downside to overdoing tech adoption is spending resources and not actually solving the problem (or worse, introducing a new one via complexity or unintended consequences).

Where are you getting your advice?

Considering the complexity, rate of change and expense, relying on internal or external advisors is smart. But it’s equally smart to be aware of blinders.

Internal advisors may be very excited about working with a specific technology or having an interesting project under their belt.

External advisors may have a subconscious tendency to recommend a specific technology solution that they are more familiar with that solved somewhat similar problems in the past.

Having tech-first mindset is not a result of malicious intent - and not a crime. But you want a non-biased advice and the best way to get it is to follow a skeptic journey.

Business before technology

If you look at the failed digital project statistics, poor requirements are often quoted as a number one reason. I don’t believe it’s the right starting point.

Sure, poor requirements will not result in a good outcome - but by the time you are collecting requirements, it was already decided by someone that technology is the one and only solution to the problem.

My favorite exercise is to come up with at least five solutions (usually last ones are rather wild) that could be successful - and quite often technology is not on the list. The choice then shifts from binary “should we do A or B” to a whole variety of opportunities to solve or ignore the issue at hand.

Should the energy be invested into solving this problem or is it manageable? It’s a fun math problem - if your team spends 30 minutes a week managing the issue, at what point would investment in automation pay for itself assuming your operations won’t change?

What is the simplest and easiest way to address the issue - even if the solution doesn’t “scale”?

Do we already have something in-house that can be used to solve the problem?

The same principle should be applied to working with advisors. Ask someone to find the “best CRM for our sales team” and you will end up with more software. Instead ask them to find the reason why sales team performance lags and then provide no less then five strategies to address.

Be careful not to not include the preferred solution in the problem statement. Prepare to be amazed.

Simplicity wins

There is a puzzling movement to overcomplicated business solutions. Something simple - like spreadsheet - is often used as a proof that your company simply must have a full digital overhaul.

“You are still using spreadsheets! You must have this fancy analytics software instead!”.

Larger companies use spreadsheets and formulas to run parts of their operations and don’t feel bad about it at all.

I bet that every single piece of commercial software in your company has at least 30-40% of unused features - features that you pay for via licensing and maintenance contracts. Why overbuy?

Be skeptical during demos. Don’t forget to consider software under-utilization and required eventual migration that will drag down the ROI. The benefits must be amazing and apparent.

You can be wise and cool

Fear marketing aside, how do you combine being skeptical with coming across as a progressive leader of a modern company that keeps the finger on the pulse of innovation?

You build the innovation team.

The team should include your biggest and most enthusiastic technology champions. The charter - dedicate a predefined amount of time each month on learning, experimenting and building with new technology and demo-ing the findings.

The benefits are immense.

• Your company becomes well prepared for technology shifts by developing internal talent
• The talent is engaged and excited
• You get a front row seat to figuring out how technology trend fits your business
• You can casually mention innovation approach and lessons learned to your peers
• If you decide to look for vendors, the gained expertise will allow you to easily separate fact from fiction.

Tech as a tool - that’s good business

Technology is a accelerant for business improvement and innovation.

Do not avoid it.

Approaching tech adoption with careful analysis and clear goals and expectations is paramount to success.

In a world rich with software, the competitive advantage may belong to those who know when to pick a simpler non-technology solution.