I will be the first to admit that I love a cool piece of technology. Software, hardware, I just think it’s cool. Even with a degree that combines business and computers, I am still amazed by what people can do with technology. However, as amazing as our technological advances are, in some businesses they are causing more problems than they are providing benefit.

The tech industry has done a great job with their marketing. They have convinced us all that their product or service can make us more productive, more profitable, and more agile. However, those companies don’t know your business like you do. They cannot tell you if their product or service really helps you. That is up to you. So many of us see technology as this black box where few knows how it works, but people just assume it must be good.

Companies both large and small spend million upgrading software and computer systems not because it helps them, but because it was the latest new product and the thinking is, “Newer must always be better.” Now don’t get me wrong, I’m not saying everyone should be running Windows 98 and playing Pong. What I am saying is that when you are considering a new piece of software or hardware for your business (or even for personal use), take a few minutes to evaluate whether or not this purchase is truly going to benefit you or is there a simpler solution.

I was recently working with a client on some consulting work for his small business. He is looking to expand his marketing and wanted to ramp up his affiliate program and come up with an easy way to be sure they all got paid. I started looking at different software and internet-based affiliate programs that would help him do what he wanted. While I was in the process of doing that, I met with a mentor of mine and happened to mention what I was working on with this particular client. After hearing me talk he stopped me and asks, “Why not just use a spreadsheet, total what each person is owed, and then pay them all at once?” See even I fall prey to the bells and whistles I’m advising you to be cautious with.

Everyone always wants everything to be automated where they just click one button and they can go home. This creates a huge problem that is plaguing small and large businesses alike in the middle of the economic downturn. Many managers no longer understand how their business functions. They have integrated so much technology (that they were not even sure how it worked in the first place) that everything is a mystery to them. How can you operate a successful business or get that next round of funding if you cannot understand or explain what that technology is doing and how it is of benefit to you?

Technology is great and it has allowed us to do things that we never dreamed we would be able to do. We use it everyday in our personal and professional lives. Just remember that like everything else, it has its place.

So, here are what you should take away:

1) When making a change, consider if a new piece of software is really the best solution to your problem

2) You don’t need to be a tech guru, but be sure you understand what the technology you are using does (in basic terms)

3) Routinely evaluate every piece of technology that you use in your business and see if there are other options out there that can make you more efficient or save you money