How Investing in Software Can Save You Money During a Recession!

One of the best things an organization can do is improve efficiency. Investing in technology, specifically using custom software as a solution can do just that. Saving time, money, and increasing productivity.

With development for a software application taking between six months and a year beginning the process now means your organization will be well-positioned to save time and money and improve productivity if we are entering a recession.

Yes, I wrote the word “recession.” And, even if you are a glass half full person, which I am, the signs are pointing to the United States entering a recession. A recession is defined by 2 consecutive quarters of declining GDP growth. Last quarter (1st quarter of 2021 down -1.4%) was negative and this one will likely be the same.

The Nasdaq is down 29.3% from its peak on November 19th, 2021 which puts it in a Bear market. Definition of a Bear Market: a period in which either a stock or market index drops by 20% or more from a recent high point. The S&P 500 has fallen for seven consecutive weeks, it’s worst stretch since the dot-com bubble burst more than two decades ago.

Not to drill the point home but tech stocks are also taking a beating. For those of you ignoring your stock portfolios at the moment, skim past the list that follows this sentence.

  • Facebook is down 42%
  • Uber is down 44%
  • Zoom is down 47%
  • Paypal is down 60%
  • Apple is down 21%
  • Amazon is down 35%

But, even with all the statistical doom and gloom, the optimist in me believes that now is the time for organizations to start evaluating how to position themselves to weather the next few years.

Invest Now to Save Long Term

Let me give you a couple of specific examples where companies are investing now to save long term. An investment in technology isn’t just saving time and money. It is not about improving productivity and efficiency for a few months. The savings are from the moment the application launches to infinity and beyond.

One of our clients came to us with a legacy system. This client was incurring a lot of costs on troubleshooting issues with hardware, employee downtime with broken devices, and the cost of devices needing to be replaced. They came to us ready to invest in software that can continue to grow more robust over time and know that the solution will revolutionize how they approach their business. Leveraging a mobile app that can be used on employee devices instead of incurring expenses for both hardware and software. The client knows it is an investment in time and money to build out a piece of custom software but realizes their company can’t move forward without the investment.

Investing in a mobile application allows them to save money on:

  • Time spent on support calls for legacy hardware
  • Downtime spent by sales reps trying to get legacy hardware working
  • $2000 scanners by replacing them with $450 Android phones which are readily available and have manufacturer support

Another client, who is purchasing companies and working to integrate everyone under one organization is building a single software solution. It streamlines the integration of new companies and overall software cost as the company grows to include different sales teams. One of the biggest efficiencies realized is the ability of sales to create a proposal and have a customer sign digitally instead of printing out a contract.

The savings and the money-making here include:

  • Saving on training for employees as everyone uses the same software
  • The ability for sales to move between companies under their umbrella organization
  • Customer education materials and training have increased sales because customers understand more easily the features and benefits of the product

You may be thinking that now is the time to pause, not invest. However, according to a blog post by KDG, custom software can save the average employee 240 hours a year. that’s 2 hours a day, (get your calculator out and figure those savings up). Not investigating how you can leverage software within your organization is costing you money.

4 Ways Custom Software Can Support Your Organization

Automate Manual Repetitive Processes

Review processes within your organization. Do you have individuals who do the same manual repetitive process daily, weekly, monthly, or even quarterly? Those are processes that can be automated with custom software. For example, one of our company’s sales team would drive to a potential client, drive back to the office, send a proposal, then call them to see if they got it. Back and forth with questions until the client signed. Now, with custom software, the sales team can create a customized proposal on the spot and have the client decide to do it immediately or ask questions then and there. Upon the client signing the agreement the work can be scheduled. A one-stop sale and close. This is definitely a win-win and the improved efficiency means the sales team has more time to make more sales!

Eliminate Hardware with Software

You have hardware and have to buy hardware and computers to support it. Remember the first example from above – the company has hardware and software. The hardware is constantly breaking down and is now outdated. By building a custom software solution, they are eliminating the hardware, and the software can continue to grow and evolve over time. This is saving time, and money and improves productivity.

Improve Customer Convenience and User Experience

Let’s face it. We all want life to run smoothly and easily. If we are offering our customers a product or a software solution it needs to be easy to use. One of our clients has field cameras. Having a smooth user experience for customers is critical to the success of their product. Customers want to pull up their cameras and be able to see what is going on in the field. Having an application that not only allows them to see but that is also easy to navigate creates brand advocates. Brand advocates tell others about this wonderful application. Sales increase.

Integrate Teams by Improving Communication

This is my favorite example of how software can improve an organization. The utilization of software as a communication tool internally and externally will save money, frustration, waste of resources, and time. A large construction client was having to call crews when work was delayed or they needed them to go to a different worksite. The client estimated it took up to four hours to contact everyone. This meant they had people at different places at the wrong time. They were paying them for showing up and there was chaos. With the development of their app, they can have their crews check the app first thing in the morning and instantaneously give instructions to everyone!

The same holds true for their external vendors. A cement truck needs a certain amount of time to mix a certain type of cement for a particular job. If that job gets canceled due to weather or inability to get everyone there that needs to be there, it can take them up to 3 hours to notify the cement vendor. At that point, it is too late. The cement is mixed and will have to be thrown away. With the application, vendors can be notified of any changes and make adjustments. Our client believes this will save the organization approximately $500k a year in labor and supply costs!

Resources

If you look around and find ways to leverage technology to solve a problem, your next question may be how to make it happen. You may have an internal team that is already swamped with projects. Or, you may not have a team with the specialized skillsets to accomplish the task. There are multiple ways to get to a solution: outsourcing, off-the-shelf solutions, or offshore development are just a few. Here’s a blog post by our Vice President of Sales which outlines what to ask if you are looking at offshore development vs. onshore development. It also gives you the names of a few of our competitors to help you determine the best path forward for you.

Being proactive, like writing this blog post before a recession is officially declared, will help you in the long run. Spend some time strategically thinking through how you can become more efficient. Efficiency bears productivity which in turn will make you money. And, give us a call if we can be of help.

*Statistics and Information for this article come from the following sources:
Investopedia, SF Gate, Y Combinator, Nasdaq.com

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