Advantages and Disadvantages of Technology in Business
Today, most businesses are relying on technology in-order to overcome the ever growing competition globally and to improve on the way transactions are made. In fact, integrating technology into your business helps you to easily manage inventories, track contacts, improve on product and service marketing, improve on sharing and storing information, decrease on human error and it also improves on communication within the business. However, businesses should always allocate some funds for upgrading and maintaining their new technologies in order to manage the highly competitive business environment. Additionally, businesses should also spend certain amount on training their employees on how to use the new technologies so that the business can keep running smoothly. All in all, integrating technology into businesses has its own advantages and disadvantages whereby all these will be listed below so that you can be able to easily asses the importance of technology within your business.
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Advantages of Technology in Business:
- Improved speed and time-management within the business: with technology integrated into business, companies can easily carryout businesses at a fast-rate and this has actually enabled small-businesses to compete with large businesses by simply being more agile and fast when it comes to providing services and products to customers. In fact, today companies can easily contact customers and even provide services or products faster and conveniently than ever before whereby this has greatly improved on the way people do business.
- Easy storage of business information: technology actually facilitates for easy storage of business data whereby it helps to eliminate the need of double or triple entry systems and also reduces on the creation of large amounts of paperwork. In fact, with the integration of technology within your business customer information and contracts can be easily stored in a virtual data warehouse and then accessed in just seconds if needed thus eliminating the need to purchase or rent storage space for your business.
- Improved sharing of information: technology has actually improved on the way information is shared within companies and even outside whereby employees can easily accesses all the information they need within the company. On top of that, even customers/clients outside the company can easily get some information by simply visiting its website or receiving an email from the company staff about what they need to know. In fact, today technology is allowing for information-sharing faster and with fewer resources and this has actually saved companies a lot of time and money when doing business.
- Decrease in human-error through automated systems: technology actually allows businesses to automate functions that may have required the need to hire an employee. for example, there are new software’s and programs that can be used for bookkeeping like QuickBooks, sales-functions are also automated by using contact management sites and all these systems actually help to cut down on labor expenses while eliminating human-errors within this sections in the company.
- Technology enables businesses to operate for longer: today, businesses can actually operate for 24hrs daily due to the integration of technology. For example, most banks around the globe operate for 24hrs everyday with the help of ATM-machines whereby someone can withdraw money from his/her account at any time conveniently. Additionally, some companies have websites that enable customers to order for goods at any time of the day or night and then receive these products at their doorstep faster than ever before.
- Creation of new jobs within the business: although technology eliminates some jobs, it also creates new job-opportunities and some of these include; computer-programmers, system-analyzers, software and hardware developers, website-designers and a lot more. In fact, all these job-opportunities are always available in companies that integrate advanced technologies into their systems.
- Improved communication between the business and its clients: today, a company that has integrated technology into its system will be able to easily communicate with its employees, customers and even suppliers through E-mail platforms, chat-systems, Video-conferencing systems and a lot more. In fact, in the early days of technology e-mails used to provide a simple and affordable means of communication within businesses and clients but these days there are actually several advanced communication tools that are enabling businesses to communicate more effectively like, live-chat systems, online meeting tools and a lot more.
- Easy inventory management: today, businesses have integrated inventory management systems that help to track the quantity of products sold and left inorder to trigger an order for additional stock if the product quantities fall below the pre-determined amount that should be left in the store. In fact, an inventory-management-system will work perfectly when connected to a point-of-sale system inorder to eliminate occurrence of errors within the business. A point-of-sale system actually ensures that each time a product is sold it is automatically removed from an inventory account thus creating a closed information-loop between the 2 systems.
- Easy data management: today, most businesses/companies store digital-documents on servers and other storage devices. In fact, these documents are always available and can easily be accessed by everyone in the company regardless of his/her geographical location. With such technological advances today, companies are capable of storing and maintaining huge amounts of historical-data economically and even employees can greatly benefit from instant access to the information they need.
- Technology enables businesses to track their progress through management information systems: management-information-systems actually enable companies to easily track sales-data, expenses and even productivity-levels. In fact, the information the company gets from these systems can be used to track profits, optimize return on investment and even identify areas of improvement. All in all, management information systems will enable the company to notice any changes in business and then immediately react by simply boosting employee productivity, reducing on the item price or by changing on its strategies.
- Increased reach to different markets: by using technology in business, you will be able to reach a great number of people or markets just with a click of button. This can actually be achieved by advertising your products or services online inorder to reach a lot of people and the good thing with online advertisement is that it can even target specific individuals that may be interested in buying your products. Additionally, online adverts are more effective and this implies that a company is more likely to increase on its revenue when using them which is actually an added advantage.
Disadvantages of Technology in Business:
Although technology may offer several advantages to your business, it can sometimes be dangerous and disadvantageous to your business in different ways and that’s why businesses are recommended to take serious measures when integrating technology into their systems. So, below are some of the disadvantages of using technology in business and I think you should clearly read through inorder to find solutions to these problems.
- Increased competition between businesses: the only problem with technology is that it’s available to everyone and this actually implies that any business can easily acquire the technology you’re using in your company and this actually increases on competition within the business world. In fact, today most companies are struggling to stay in business due to the high-levels of competition in the markets and this has been accelerated by the rise of several business-technologies. This level-of-competition is becoming expensive and stressful especially for small-businesses that are just struggling to rise and even most small-business have fallen due to this stiff competition.
- Distraction of employees: technology advancements have actually led to an increase in distraction at workplaces whereby some employees will be chatting on social-media platforms, others sending e-mails, others making phone-calls and some watching videos while at work. This actually takes up most of the time that employees would have used to accomplish certain company tasks thus reducing on the productivity levels of the company. In fact, technology demands attention inorder to work effectively but again it brings a lot of distractions that actually affect the company in the long run.
- Loss of face-to-face communication (interpersonal communication skills): new technologies like cell-phones, email-platforms, social-media-platforms and chat-platforms have greatly replaced face-to-face communication. In fact, most employees tend to spend their time communicating with people on social-media platforms instead of talking with their fellow work-mates and this has actually led to reduction in productivity and poor communication skills within companies. In fact, face-to-face communication is very essential when it comes to building business relationships but these days business is done online without any physical interaction of the client and company whereby this can be a bit risky in case something goes wrong when making a transaction.
- High maintenance costs: technology keeps of improving and this implies that it requires constant and costly upgrades as time goes by. In fact, each technological upgrade requires employee training and this actually reduces on the productive time of the company. So, loss of productivity coupled with high-costs of software and hardware implementations will greatly reduce on the profitability levels of the company. Additionally, once a new system upgrade has been made there will be ongoing maintenance fees and even some employees will be struggling to learn how to use these new applications/technologies thus affecting their performance at work. So, as a company owner you should know that integrating new technologies into your business is costly and comes with other serious problems.
- Increased insecurity in business (cybercrime-related risks): technology also comes with increased security risks like hacking, information-theft by employees with security clearances and a lot more. In fact, employees with financial and personal-data about customers/clients can at times be a threat to the company since they can easily use that information to manipulate the company clients. On top of that, companies that use online systems like banks actually find a hard time making transactions online due to the high-risks of hackers who tend to eavesdrop important information or even tap into the bank-accounts of clients. However, there are now many security companies and software’s that have been developed to help protect online-systems. Additionally, businesses should also consider hiring a professional system-security expert to monitor their online systems at all times inorder to prevent any security risks.
- Loss of jobs within companies: many employees have actually lost jobs today due to gradual technological-advances that have replaced tasks that were being done by people before. In fact, today there is almost software that can be used to accomplish any task within the company and in the nearby future some businesses won’t be employing anyone to operate them but instead use these advanced technologies to accomplish all tasks. This can be an advantage to a certain degree because companies can make a lot of profits with few or no employees but there is also a huge problem because machines or software can’t perform certain tasks like human-beings do.
- Reduced competency and creativity by companies and their employees: the increased dependency on modern technology tools has actually reduced on the creativity levels of companies in terms of marketing their services and products whereby companies just rely on provided technologies thus leading to a decline or fall of most companies today. Additionally, employees of companies are no-longer competent as they used to be because they over-rely on technologies integrated by companies and this has led to a decline in productivity.
- Risk of loss of company data: in case the information systems being used in a company breakdown or crush when the system-administrator hadn’t made a back-up yet, then the company is most likely to lose its important information about clients and transactions made previously. So, it’s highly recommended for companies to create a back-up strategy inorder to avoid the risks of losing important data in case something happens to their information-systems. In fact, there are many factors that can lead to technological or system break-down and these include; cyber-attacks, viruses, overloading the system, vandalism by employees and lot more.
Note: technology has created a huge impact in businesses today in terms of advertising and marketing, communication, sharing and storing of data and it has highly reduced in occurrence of human-errors in companies hence reducing on operation-costs while increasing on company revenue. However, technology also has several disadvantages that have been listed above but these can be dealt with if you get some advice from professional IT personnel and if you have the right team within your company. All in all, it’s highly recommended to integrate advanced technologies in your company if you really want to cope up with competitive business-market of today.