3 Reasons Software Abandonment Should Scare Business Owners

May 13, 2017

10:30 am

Many business owners are drawn to the idea of a new software that promises to solve all their problems. In an endless quest to find a competitive edge by increasing efficiency, companies are constantly signing up for and trying new software products.

The issue is, many of these new software tools are doomed to become “Shelfware”: software that is paid for but never ends up being used. A report by Flexera Software/IDC  revealed just how big of a problem this has become. Here are the three most eye-opening statistics from the report:

  • 96 percent say that at least some of the software they’ve purchased is shelfware.
  • 39 percent reported that 21 percent or more of their enterprise software budget is wasted on shelfware.
  • Almost two-thirds of enterprises (63 percent) said their budgets would either stay the same or shrink in the upcoming two years.

While the goal of software products is to help companies, this report suggests that many software tools have the opposite effect. Here is why this is a big problem for business owners:

The Bottom Line

“At the end of the day, it all comes down to the bottom line. Revenue and profits matter now more than ever, and companies are now seeing that software they are investing is not only not solving the problem they hoped it would, it is costing them a lot of money,” said, Ken McElrath, CEO of Skuid.

Considering that the market value of enterprise software will grow to $438 billion dollars by 2020, there is a lot of money on the line here, and as these software budgets get squeezed, investors and executives will no longer tolerate throwing away money.

User Experience

Enterprise software is undergoing a significant shift towards consumerization, and that’s because companies understand that the end user has now become the decision maker. An article titled “The Future of Enterprise Design Is Consumer-Grade “in UX Magazine explains:

“For traditional enterprise products, the model used to be that you sell to a C-level executive at the company, and the employees then use the tools they are provided. If an application was painful to use, employees would use it as little as possible, and instead use time-consuming, often manual, workarounds to avoid spending time in the tool.”

Allowing the end users to influence the development of a product makes logical sense, but many companies are just now starting to understand the adverse effects of having an unfriendly UX. McElrath explains:

“No code means significant cost and time savings. Across the board, customers with bespoke solutions like ours see significantly improved UX and productivity, a dramatic reduction in time-to-market, significant time and money savings, and an increase in revenue generated.”

Data Wins

Nearly every company, from small businesses to large enterprises, has a data or business intelligence strategy. Unfortunately, many of those strategies fail. In a report by Gartner that outlined the 9 fatal flaws in Business Intelligence implementation, one of the top flaws was the problem of data quality:

“Data quality issues are almost ubiquitous, and the impact on BI is significant — people won’t use BI applications that are founded on irrelevant, incomplete or questionable data. To avoid this, firms should establish a process or set of automated controls to identify data quality issues in incoming data and block low-quality data from entering the data warehouse or BI platform.”

At the core of this data problem is fragmentation, and when it comes to enterprise software, there’s no exception. Internal databases and patched together software are leading to questionable data, and as companies begin to expect data to be actionable, false data can be detrimental to a company’s growth and survival.

Read more about business trends here on Tech.Co

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Jyoti is a tech writer who loves to write about anything that is related to technology, She also has interest in entrepreneurship & Digital marketing world including social media & advertising.

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