While technology is seen by many as the solution to New Zealand's productivity problems, Warren Hughes says often it only complicates things and wastes time.
The average New Zealand SME business uses about eight different cloud applications without seeing any noticeable improvement in productivity or profit.
Technology commentator and chief technology officer at OneHQ, Warren Hughes, said that while technology is seen by many as the solution to New Zealand's productivity problems – the latest shiny object is artificial intelligence (AI) – most of the time the technology only complicates things and wastes time.
"Not only are Kiwi businesses riddled with cloud software solutions that cost money, are largely unused and don't talk to each other, but they're surrendering control of critical data to offshore multi-nationals."
Hughes says that in his experience from more than 30 years as an IT specialist – in roles such as CTO for Lotto New Zealand, head of product development at Fronde and general manager of Equinox IT – his general observation is that Kiwis are easily seduced out of their technology dollars.
"Big budget marketing hypes up many cloud applications. On the face of it, they seem cheap. What nobody is telling you, is that to get value out of these tools – and they can be useful – requires a significant investment in time and training.
"At the same time, your critical data – such as financial information and your client details – are locked in these applications, which do not talk to each other. Not only do you not 'own; your data, there's not much you can do with it outside of those apps," Hughes said.
New Zealand businesses should not concern themselves with the benefits of artificial intelligence because the technology will become part of the software they already use, including apps like Xero and Vend. The technology is not nearly as important as the desired outcome.
"If you are a small to medium businesses owner, focus on the outcome first and avoid the distraction of technology, it's not a silver bullet. Technology is a means to an end. Software solutions like Xero, for example, will take care of the AI functionality for you.
"Ultimately, business leaders are trying to achieve goals, and they need a variety of tools to achieve that. Fix your objectives and then select a simple, best of breed set of tools that talk to each other and which allow you to retain control of your data," Hughes said.
The technology itself should be a minimal part of a conversation that is dominated by understanding the business itself and its objectives. "Businesses who have a handful of best of breed technology solutions in the company will see the benefits of AI without having to do anything about it.
"For example, I expect business leaders will soon be able to verbally ask questions of the software and get back accurate financial answers in plain English. However, it is the function of the software, not an end in itself," he said.
"The problem is that we tend to overestimate the effect technology has on us in the short run, and over underestimate the impact in the long run." - Roy Amara.
Hughes offers the following tips to business owners who want to achieve higher productivity and profit from their technology. Unsurprisingly, it has very little to do with the technology itself.
1. Take back your time.
Business owners are so busy that they rarely have the time to focus on the business itself, never mind growth or evolving technology.
"Most business owners don't have the time, energy or brain space to objectively look at business and build a plan around the company. Consolidate suppliers, consolidate the technology and make them work together as a team – you should not be the glue that has to hold everything together.
"Get professional advice and help from providers who are outcomes focussed, instead of looking to cheap technology solutions to save a dollar. They cost you more in the long run."
2. Set goals.
Business owners have, by necessity, a short attention span because they have so many verticals to be across.
"In New Zealand, we are exposed to a lot of marketing associated with technology for businesses, most of which way over-promises and way under-delivers and then moves on to the next thing before you can even do something about the first thing.
"Set your goals. Know where you are going. Have a plan, and then get the help and the tools you need to get there."
3. Keep your 'context' consistent.
Research shows that shifting context – multi-tasking or moving from one task to the next, to the next – is exhausting and the most damaging to long term plans and objectives.
"When a business owner is dealing with, for example, finance one day, health and safety the next day and getting quotes out the day after that, they get stuck in this vicious cycle that never ends.
"Prioritise your most important task - for example, sales - and hire staff or engage suppliers to do the other urgent-day-to-day tasks like writing your health and safety manuals, looking after your financials and implementing technology solutions."
Hughes said that OneHQ – which aims to consolidate services like accounting, finance and technology – is on the verge of releasing a technology platform that ties best of breed apps together into an integrated, complete solution.
Most businesses have an incredible library of apps to operate, but those don't necessarily make them more effective. Businesses need a solution that glues the best of breed apps together and lets them keep control of the data.
"For example, you could – if you wanted – replace Xero with MYOB seamlessly (or vice versa). A bunch of different apps working independently don't let you do that.
"SMEs are such a big part of the economy, but they need providers with innovative ways to deploy technology to improve outcomes like productivity, efficiency and growth. As noted futurist and scientist Roy Amara said, ‘the problem is that we tend to overestimate the effect technology has on us in the short run, and over underestimate the impact in the long run’," Hughes said.