Everyday, your business is leaking money due to your technology. The biggest leak of money in your business is not a service call but the loss in productivity from workers idled when their computer system doesn't work properly. For most of us, "no computer" means "no work."
For overhead employees such as administrative staff, receptionists, clerks, etc., the cost when computers are down is their wage plus taxes and benefits (fully burdened). A cost of an employee earning $20/hr is about $25/hr fully burdened (add 25% for taxes and benefits).
For professional services businesses, the cost when computers are down is rate at which you bill your customers for your employees' time. For instance, a CPA might bill out an analyst at $125/hr. When they can't conduct research or access spreadsheets because the server or their PC is down, the loss in productivity cost is equal to their billable rate, or $125/hr.
Technology leaks range from of slow computers or Internet (5% to 50% productivity loss) to complete workstation, server or Internet outage (50% to 100% productivity loss).
I have found that successful business owners work hard to minimize those leaks. Struggling business owners falsely think they are "saving" money by not replacing old equipment, living with slow Internet and overall not properly investing in the technology. Here are some areas where you may be leaking money in your business technology:
- Slow Internet - If your bandwidth is too low and users are waiting too long to get information off the Internet, then you are leaking money. A DSL connection may be suitable for a small office, but businesses with more than 5 users should definitely be looking at T1 or cable Internet. The increased speed means that users are being more productive.
- Old computers - Just the other day Janet, who does payroll for one of our clients, told me that it took her computer about 20 minutes to boot up. That's 4% of her work week of zero productivity. She also complained that she had to wait for applications to open and for web pages to load. A faster computer would give her a 5% to 10% productivity boost. If her fully burdened rate is $40,000 per year, her slow PC is costing the owner $3,600 to $5,600 per year. Economically, a new $1,000 computer would pay for itself in about two months in increased productivity alone.
- IT Service Agreement - Derrick owns a successful tax accountancy and calls AXICOM occasionally to fix various issues. I was talking to him about our AxiGuard proactive service and support plans but when he saw the price, he exclaimed, "that's the lease payment for my wife's BMW!" Derrick employs 7 people of which 4 are billable at $175/hr. So when their server is down about 2 hours per month due to spyware infection, virus problem, and other issues, it's costing him over $1000 per month in lost productivity. Having our maintenance agreement would eliminate or reduce server outages and save him over $500 per month, or enough for another BMW! A managed service agreement with monitoring and automated maintenance can save business owners 30% to 60% over traditional break/fix service.
- Review Your Bills - I was looking over my mobile phone bill and found a $15 charge on one of the phone lines for roadside assistance. I never signed up for this service since I've had Auto Club since I first learned to drive. So I called the phone carrier who quickly reversed these false charges. I also found that my Internet service was out of contract and was able to get them to reduce my Internet bill by $40 per month. These are small amounts but having a "leak detector" mentality can save you $1000s per year.
- Color Printing - The savvy business owner knows not to get lured in by cheap color inkjet printers that are "free" with a new computer. But some photo inkjet printers are better at reproducing photos compared to color laser printers. But for general color printing of graphics, reports, brochures or sales presentations over 1,000 pages per month, a color laser printer will save you about 50% per page vs. an inkjet printer over the lifetime of the printer.
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