Is more IT always better for business?

Innovations like cloud computing have made it easier than ever for small- and medium-sized businesses to offer advanced, IT-enabled services and support to their customers. But just because they can, does it mean they should?

It’s become a given that people should be able to interact with companies in the way that works best for them – whether that’s via a company website, a smartphone, a bring-your-own-device-to-work policy or a social media outlet like Twitter. But if a business can’t manage all those channels effectively and securely, those promises of customer-focused interaction could fall short of expectations.

The latest “Global Reputational Risk and IT Study” from IBM, for example, found that many businesses are starting to look at how failures in ever-more-sophisticated IT could hurt their reputations and damage customer trust:

“Based on this study of 427 senior executives worldwide, three principal forces drive corporate reputations: provision of a best-in-class product or service, customer engagement and trusted-partner status. Considering how companies are becoming increasingly dependent on technology to fulfill all three—to say nothing of running the business—the consensus is clear: IT risk can imperil companies’ productivity, damage customer relations and ultimately erode trust.”

Recognizing this risk means companies need to be careful before leaping into the “next big thing” in IT, even if they think their customers want it.

The IBM study quotes one IT professional from India who says he’s found many companies there are taking their time before jumping feet-first into new information technologies.

“These threats are understood, but … we don’t have data to quantify the risks,” said Jaideep Jain. “And because we’re approaching those technologies with such caution, we’re less likely to have experienced an incident.”

Even businesses already comfortable at interacting with customers through mobile devices, Facebook, Twitter and LinkedIn should be careful not to overemphasize the “big data” picture over personal, one-to-one relationships, warns consultant Rick Reynolds in a post on the Harvard Business Review blog. That’s especially true for companies in the B2B space, he says.

“As sales becomes more technologically advanced, the trend is for B2B companies to rely more on Big Data and less on information gathered from one-on-one personal interactions,” Reynolds writes.  He cites a CSO Insight study on data and sales, pointing out that many top sales people – nearly 90 percent in the survey – say they’re “missing opportunities due to information overload.”

“Sifting through sales Big Data can be like trying to pick out a molecule in a raging river,” Reynolds notes, adding that only one-on-one talks or interviews can provide the qualitative insights needed to complement the quantitative ones.

“One type of data without the other provides only half the picture,” he concludes.

This post was written as part of the IBM for Midsize Business program, which provides midsize businesses with the tools, expertise and solutions they need to become engines of a smarter planet.