Why is it so important for SMEs to modernise or replace old IT systems?
The indispensability of the digitalization of central business processes should have long since reached the minds of decision-makers in small and medium-sized enterprises. In reality, there is still a lot of catching up to do. However, the deficits are not only in online marketing, which is so often discussed in this context, but often apply to the whole business!
Optimizing central workflows such as accounting with the help of specialized IT systems is relatively widespread even in the smallest companies. According to a study conducted by the Institute for Quality Management and Applied Business Administration (IQB-FHS) in cooperation with Comitas AG, 83 percent of all German-Swiss small enterprises with up to 50 employees use at least one standard accounting program. In addition, there are many Excel and Access databases in operation, which make it difficult to integrate and adapt to changing business processes. The optimum, i.e. an individual software solution tailored precisely to the respective business processes, is used by less than 20 percent of these companies.
Many solutions that enable the economic management of a company are expandable or insufficiently integrated. And when more far-reaching, perhaps even individualized systems are used - which primarily applies to medium-sized companies with 50 to 100 employees (36 percent) or those with more than 100 employees (59 percent) - these are often outdated. This results in considerable risks for the respective company. You can read below which these are, how you recognize them, whether a change to a new IT system or a refreshment of the existing one in your company is relevant, and how this is done efficiently.
In addition, you can view the complete study right here:
Which central dangers lurk with outdated IT systems?
Many old IT systems can barely process all of today's required or digitally possible processes. This is also the conclusion of the study. A not inconsiderable proportion of respondents (18 percent) stated that they would like to see more harmonious cooperation between individual applications and programs. This disharmony and often accompanying issues result, among other things, from the necessity of combining components for new requirements with old (complete) systems. In any case, a lot of time and money is lost here!
In addition, whether you work B2B or B2C, online sales via an appropriate system will become increasingly relevant. In many areas, the sales strength here is already significantly higher than with classic forms of distribution. If your system does not allow a largely automated handling of the applicable processes, you have a considerable problem!
It will hit you even harder if the technology you use no longer receives updates, because the software product may no longer be offered. This means that you will no longer receive enough support and will only be able to resolve problems with great delay.
Or perhaps Microsoft releases a fundamentally new version of the Office palette and previous applications based on VBA (Visual Basic for Application) no longer work. Important processes of your business are completely switched off! Repairing this can be tedious and costly for you.
In another possible - and without doubt extremely fatal - scenario, your old server can no longer be started after a Windows update, for example. As a result, your online-based company will be disconnected from the network for an unforeseeable period of time and you will therefore not be able to process any orders or current orders. It takes days to find an IT expert who is familiar with the outdated technology. In addition to the potentially immense loss of earnings, fixing the problem itself is also guaranteed to be highly costly.
In addition, expanding your business circle with an outdated IT system is becoming increasingly difficult. For example, your new supplier or customer expects a connection to his delivery or ordering system via web services. However, your applications are not able to do this. The consequences are limited cooperation, disruptions, additional work for the double entry of data in two systems and ultimately an increased risk of not being able to satisfy the new partner.
In addition, it may be necessary - for example during a tax audit - to clearly understand which user in your company had which rights and when and which data was entered, deleted or edited. If this is not possible with your IT system, your company can run into serious difficulties.
Or maybe there will be a - basically very pleasing - increase in orders - but your outdated IT system will push your employees to their limits. Too much time has to be spent working with the old application - too many steps and clicks are necessary, and this ultimately increases the error rate. The potentially positive situation of the increase in sales ultimately becomes a serious problem here. You may not be able to supply your customers fast enough and thus force a negative impression with long-term consequences.
What factors indicate that your IT system needs to be renewed or replaced?
Once one of the scenarios described above has occurred, the associated damage can only be repaired with difficulty or, in the worst case, not at all. To prevent this from happening in the first place, you should ask yourself the following questions about the status of your IT and, if necessary, react with an appropriate reorientation:
- Are you somewhat relieved every morning that your server or your application still functions properly and your employees can continue to do the work on schedule for your customers and partners?
- Is it no longer possible to implement new processes or is it only possible to implement them with great effort? Are no flexible interfaces available or can important functions for external partners or customers not be made available on the Internet?
- How do you feel about the security of your application - are you afraid of the loss or theft of confidential, business-critical information?
- Does your software offer the possibility to see in detail who changed what and when? Is it therefore also sufficiently meaningful in the event of a revision?
- Can you use your IT system on the road, perhaps without connecting to your office network? Is there a version optimized for the tablet or smartphone?
- Is your system generally future-proof and do you always get fast and reliable support in the event of an acute problem in order to be able to work optimally again quickly?
According to a study by the Institute for Quality Management and Applied Business Administration (IQB-FHS) and Comitas AG, the latter is no longer the case for around 30 percent (!) of currently running systems in the next three years. In addition, it illustrates by means of further figures that a considerable proportion of German-Swiss SMEs are only partially satisfied with their current application. And without a doubt this is always one of the strongest arguments for a new IT system!
A large proportion of the companies surveyed in the course of the study are not 100 percent convinced of their own IT systems. Only just under half said that they could optimize the existing application structures and other digitalization measures with their own employees. The best solution is often cooperation with an external IT partner. This results in various considerable advantages, which lie above all in the possibility of a much more comprehensive utilization of the current technical standards.
With the full use of modern web technologies, existing applications can be built up relatively easily and quickly and an existing system can be made fit for the future. The IT market is already very broadly positioned in this area, which means that you always have an optimal provider at your disposal, no matter what your requirements are. In most cases you even have a multiple choice, which means that you do not have to become dependent on a single provider or technology.
Bring your application to the cloud! Despite all fears, the latter is much more secure in most contexts than a local server on your premises. In addition, the cloud has the decisive advantage that it is managed by real experts, ensuring reliable operation and necessary maintenance at all times. With a cloud solution, you only pay for the server resources you really need. New servers or so-called VMs (virtual machines) are available within minutes and with just a few clicks. They can be deleted just as quickly when you no longer need them. If you need more power at short notice (e.g. for a month-end closing or in the case of a seasonal increase in the order rate), the available resources (storage capacity or computing power) can be adapted within a few minutes.
If you call in an external IT partner to create or optimize your IT system, not only your customers and your specific company orientation will be at the centre of the development work, but also your employees. The focus of a professional implementation of a new system that ultimately significantly increases efficiency is always on optimal usability in the context of the respective requirements. This is the only way to maximally optimize the corresponding processes in the future. Even new employees usually only need a few hours to find their way around the application.
When using a modern, user-friendly IT solution, your employees can concentrate fully on their customers and do not have to invest a disproportionate amount of time in using them. Modern, reliable and user-friendly tools contribute to the satisfaction of your employees, which should not be underestimated, and through a smooth sequence of corresponding business processes ultimately also of your customers.
Modern applications offer flexible interfaces. This applies to both the import and export of data. In addition, they can be quickly connected to other systems via so-called web services or micro services. This applies to your own applications as well as to third-party applications of your partners or customers. This eliminates media breaks and thus the double entry of data. At the same time, the risk of human error is reduced immensely.
As a rule, the - undoubtedly highly important - data from your existing IT solution can be transferred relatively easily to the new one during the migration process. So you don't have to worry about long outages of your business. In addition, a migration always offers the opportunity to clean up the data conglomeration, to separate yourself from old burdens and thus make the new system even more efficient. In professionally executed software projects you will not be confronted with a fait accompli at the end of the development period. On the contrary - in addition to the direct involvement of your employees, customers and the general company orientation and the dedicated orientation of your new IT system in this regard, you will be regularly informed about the progress by means of prototypes. Influencing the direction of your new system is possible at any time. At the end of the project, the application must exactly meet your expectations and optimally support your business processes.
If your business is facing one of these scenarios or you are considering modernizing your existing IT landscape, Comitas can help your business develop its own solution and modernize or replace your legacy system. Contact our team for more details!