Did you just buy new tech for your company? Congratulations! Now, it’s time to start thinking about an upgrade.
So says David Mitchelhill, a long-time interim Chief Technology Officer.
Mitchelhill, who served in various CIO roles at organizations like Klarna, Freeletics, and the United Kingdom’s Ministry of Justice, is a sharp-tongued critic of everything from Salesforce to Microsoft to company owners who don’t take the time to learn about and understand technology.
By the time a company’s technology solution is a year old “it’s already decrepit,” he says.
The speed of technology development is doubling every year. Companies that don’t have AI-driven decision-making are now too late for three reasons:
1. Difficulty acquiring complex knowledge
2. Scarce talent expertise
3. Time to interweave AI-driven knowledge into the company’s fabric
If this describes your company, don’t feel like you’re alone, he says. “I mean, Microsoft missed the internet — Marc Andreessen and Netscape completely blindsided them!”
Is SaaS the Answer?
No, he says. Trusting SaaS (Software as a Service) carries its own risks. The offsite tech companies offer their services as subscriptions – generally charging so much per user each month. In return, clients presume that the cloud-based information technology company is providing constantly updated software and the best tech.
“That presumption is very dangerous” because the SaaS company has the power to withhold technological advancements.
“SAP does big upgrades every four or five years. So for two years, you’re behind the marketplace, even with a leader like SAP.”
And, Mitchelhill says, the suppliers can hold that new digital technology hostage until customers pay up.
“Continuous releases are important, but big companies do that because they use the release to extract money from the client. For example, Salesforce plans to extract an 8 percent addition from all of their existing clients. Now, 8 percent is a lot. So they are just holding stuff back and then they say, ‘Look, we’ve got all this wonderful stuff. Please give us an extra $2 million and we’ll let you have it.’
“Salesforce is basically Putin’s Russia. It will take you over and kill you if it can. It will empty your bank account if it can.”
Understanding Your Own Tech Stack
Understanding technology does not require a computer science degree or the technical skills to create algorithms. It just requires a willingness to learn and the understanding that automation, technological innovations, and the use of technology is critical to the day-to-day success of your company.
“If I go before a board and say: Can you manage your people? Yes. Can you manage your money? Yes. Can you manage your properties? Yes. Do you understand your technologies? Can you manage them? No, they’re going to say. No, I don’t want to. It’s too complicated for me. That’s why I hire you.”
“Well, if you did that with the CFO, you more than likely would find yourself ripped off.”
The answer is not to hire more young people with the know-how to do the technology work, although that may be needed. But, first, C-suite executives must commit to learning about the basic methodology of the company’s technology and understand enough to oversee an annual audit of the tech that asks:
· Can I get a better service?
· Can I get a better-quality product?
· Can I get a more economical product?
· How risky is this company?
The audit should include a hard look at your internal tech as well. “If you just rely on your tech stack, that it will keep running until it falls over, you’ve nearly predicted your future.”
“Tech stack” is the name given to the full suite of technologies a company uses, from programming languages to databases to applications.
“You always have to know that you’re replacing the tech stack. The one thing you know is from the moment you’ve purchased it, it’s going out of date,” says Mitchelhill.
The audit also allows you to know whether you are buying exactly the tech your company needs – a common result of packaged software that could have many functions your organization will never use.
“Sometimes you’re buying a massive truck with 16 wheels when all you really need is a moped.”
Don’t Get Blindsided by Technology
Disruptive tech is the way most companies get ahead in the real-world marketplace. So the worst thing you could do is stick with a company because it’s the firm you’ve always used.
Chances are you’ll discover that the company is giving much better deals to new clients.
Meanwhile, the disruptive tech is out there and your competitors are implementing it. If it turns out to revolutionize the business, “you have just been blindsided because there is lag” in implementing new technology.
Consider the food company that started using AI (Artificial Intelligence). It found mistakes in the biscuit manufacturing process. The result: an 80 percent reduction in breakage and a huge leg up on the rest of the market.