As a business owner and user of technology, I often find it hard to determine when to buy or upgrade to new technology. Unlike other consumer goods, it's not a question of when something wears out; it's a question of when it becomes outdated.
In my view, there is a difference between updating technology and new technology. Once you've been using a tool, it's pretty tough to go back. Thus, updating is essential. Deciding on whether and when to buy new technology is a question of need (or want) and timing.
Technology can be broken down between hardware and software. For hardware, like computers, cell phones, tablets, etc., I estimate the half-life at two years. This means that the functionality decreases by 50% after two years and leaves you with only 25% remaining after three years. In my office, it works like this: When a new person starts or a computer needs replacing, the most senior person gets the new computer and the newer or less senior person gets the other's hand-me-down. That way, we are continually upgrading hardware (and it's good to be queen!).
Some hardware gets automatic upgrades like cell phones. Oh yeah, you have to sign your life away, but everybody does it, right?
Software is a little more difficult. The programs that are automatically updated on subscription licenses are no-brainers. But then there are programs like Windows, Microsoft Office and other essentials. When do you have to change these? It's whenever the pain of learning a new version seems less than the pain of having programs that don't work together or don't work as well as what others are using.
Then, we get to new software (and hardware). Like with upgrades, it really depends on your pain point. It's time to invest the time and effort into new technology when one or more of the following situations are present:
• You have repetitive tasks that are eating too much time.
• You have repetitive tasks that are error-prone (when the errors can cost you time, money and/or reputation).
• Your competition is using the new technology and you need to keep up.
• The long-term technology benefits are more than the short-term implementation costs and ongoing maintenance costs.
• The new technology solves a problem you didn't realize you had.
• The new technology is not about to be overshadowed by something better within a few months.
If I wasn't open to new technology, I would not have been an early user of CRM, rebalancing software, VoIP, financial planning software, tax planning software and Bluetooth (to name a few). These technology tools have changed my work life for the better, have allowed me (and my staff) to spend more time with current and potential clients, virtually to eliminate errors, and to work remotely — even from overseas.
My advice to you: Don't wait for depletion of your technology half-life. Pay attention to what's new and wonderful!
Sheryl Rowling is chief executive of Total Rebalance Expert and principal at Rowling & Associates. She considers herself a non-techie user of technology.