Confusing the concepts of costs and investments can hurt the future of your business.
No business grows solely by cutting costs. It grows through wise investments.
One client didn’t want to spend money on new computers because it would “cost” thousands of dollars. However when we looked more deeply, he was losing significantly more than that each year by not making the investment. Here’s how:
- His employees were wasting hours each week because of the time it took to access and refresh the primary software applications that they used. That was time that would be recovered with new computers.
- He was also paying his computer support vendor more money to fix or simply maintain the mishmash of old systems and different configurations.
- He was missing out on new capabilities and efficiencies that could help him serve his clients better and more profitably
I call this tripping over dollar bills to pick up pennies.
When it comes to evaluating investment versus cost, a good place to start is by considering technology upgrades. Training is another, as is hiring temporary help to complete certain projects, rather than diverting experienced employees from the primary focus of developing business.
It’s a good policy to ask your employees for their perspective. After all, they’re the people most familiar with many of the tasks, so their input can be indispensable.
In no way do I advocate a philosophy of simply throwing money at a problem. Instead, I urge you to examine all cost decisions in light of the potential for a timely return on investment.
That’s how you will prosper.
Speak Your Mind