3 Tech Buying Mistakes to Avoid

This is the time of year that profitable digitally savvy companies may have extra IT budget to spend or are busy planning their 2020 annual budgets. When I was in IT Operations quite often around year end, my manager would tell me that we have an extra $100,000 to spend before December 31st. Times were good back before the dot com bust of 2001. What a great thing for the business and great responsibility to execute. I was trusted to analyze our portfolio of businesses/departments and determine where this funding should go. It certainly made it easy to make friends in the many business units my teams supported. Departments that despised IT suddenly loved us and the many IT-related services we provided them. It was fun to have some very rare power over the LOB execs who sometimes would belittle or disparage our hard working and often understaffed IT teams. But I couldn’t let influence or relationships get in the way of doing what I was entrusted to do. I needed to invest very wisely but also very quickly and do so without upsetting other business units. 

 So over the years I was forced to develop pretty efficient and even discrete IT buying habits. Whether you have allotted budget, budget surplus or a sudden need to acquire capacity or performance, here are three common pitfalls IT and line of business buyers make and how to avoid them: 

 1- Buying tech for any reason other than Voice of the Customer 

This can be a major challenge for established IT buyers. Often buyer/vendor relationships are strong and built over many years of transactions, through good times and bad. Few IT vendors earn the right to step on the data center floor let alone be considered a trusted advisor. It’s easy to go with a trusted advisor even if the price is a little higher or the functionality a little lower than others can provide. Sometimes working with new vendors can help reduce costs or deliver the service level/functionality the business, competitive market, or VOC (voice of the customer) requires to thrive. IT and corporate purchasing organizations have the job to figure that out. Focusing on the voice of the customer, using operational/customer metrics as the guide, can help guide buyers to investments that provide the highest returns in the least amount of time.

2 - Needlessly limiting choice

Often the business will demand a certain service or application be purchased or even worse, have already built it or purchased licenses themselves. They say this is the only vendor that can meet our unique business needs. They plead for rapid purchase of the solution as we are now in dire straights without it. Fake deadlines are created since IT is so slow limiting, thus limiting the time for more analysis. In my years of IT Ops experience, I found some users at every job level are always in dire straights, just a password expiration away from total panic and a Sev 1 ticket. Even if there are only 2 weeks to make a purchase, there’s plenty of time for IT experts to provide critical analysis of the market and ensure we are getting the best value for our business and our customers. Take the time to review the market and get at least 2 or 3 different vendor prices before you decide what is best. 

 3 - Not understanding short term and long term economics of IT investments

Sometimes focusing on price, key features or some other aspect of an IT investment can sound like the right thing to do in the short run but often there are negative consequences long term. There is an art to be learned in IT buying of balancing cost, performance, capacity, functionality, and stability. Buyers must consider not just the acquisition cost of tech but the operational/maintenance and risk involved in a tech purchase and it’s day to day operation.Utilizing weighted average vendor scorecards are a helpful tool to ensure a measured and balanced approach is taken and everyone is more or less on the same page to move forward. 

It's best to consider all technology aspects and how they benefit your customer: time to value, acquisition and operational costs,risk, tech support costs and return on investment. Make all tech buying decisions based on customer needs for both the short and long run and then you know you are making the right choice every time.  

I no longer run FinTech data centers. I now get to work with an awesome team helping drive data center and cloud optimization for businesses around the globe using advanced analytics, automation and artificial intelligence. This blog is also published on the Hitachi Vantara Community site.