Planning technology investments is a complicated effort requiring expertise in business process, security, financial modeling , customer privacy, strategic alignment and technical fit. Additionally, replacing existing systems can be more complicated than building something net-new; often requiring an added understanding on how the business utilizes the existing technology, knowing what functionality you want to keep and the pieces you want to throw away. Further complicating any technology purchase is the amount of choice. Gone are the days where one or two players operate in a niche market. We are now seeing several companies offering similar technology products in just about all imaginable areas.
With technology, our dreams can sometimes become reality. Simply look at how deeply we have connected the world in the last 25 years and you will see how far we have come. Our acceleration of knowledge and technology is unprecedented.
However, it is those dreams that can sometimes blind us to the actual delivered value of a technology investment. We see it all the time, technology comically going bad — automated restaurant kitchen systems that are insanely unreliable, food delivery robots stuck in the bushes, and my personal favorite, a shelf stocking robot losing it’s way and “restocking” the parking lot. I’m not saying we shouldn’t experiment, quite the contrary. I’m saying let’s experiment with purpose and when we choose to invest in technology for those experiments let’s do so under guidance, guardrails, and a bit of the scientific method.
Why We Invest in Technology?
So why do we do it? Why do we take investment risk on what always seems to be questionable technology?
Biologically speaking, our opportunistic nature stands in stark contrast to the specialization observed in the majority of the animal kingdom. Homo Sapiens are opportunists not specialist like many species. We are genetically driven to find opportunities and exploit those opportunities and technology simply offers us a way to compete more effectively.
From an operational perspective we look to technology to make life more comfortable thus automating things that would sap our time; think how easy it is to heat our homes now versus in the early 19th century or how Napoleon gathered information on the battlefield. Making it easier to perform normal activities frees our brain to concentrate on other things.
And for those who directly work in commerce, technology affords us new markets, easier ways to procure global goods, and a million ways to engage customers for purchase. One story that comes to mind is how Dutch merchants built the Fluyt ship to compete with the Spanish and English Galleon.
The Fluyt was 50 feet shorter but wider, which saved on taxes because cargo vessels at that time were taxed not on cargo amount but by ship length. It also had fewer cannon and could be crewed with just 30 people. The Fluyt was built for commerce not war- a specialized technology designed to procure global goods as cheaply as possible. Here’s a fun table showing how the Dutch used innovation and technology to outcompete the English and Spanish with trade. I love the starkness of this chart.
