From the title, you may have thought you were reading a play by Shakespeare. Don’t worry that is about all I remember.
When thinking about spending we have to remember that it can take many forms such as time, resources and of course money. Well, let’s take a look at some decisions we make that are very costly. When you’re young and starting a career, you’re faced with decisions that might not impact you today, but definitely Impacts tomorrow. We all know about retirement savings or the 401K. Some view this as unnecessary and push the decision to do this type of spending into the future. After all, when just starting your adult journey there are many expenses and decisions that need to be made such as housing, the 85-inch big-screen television, or that much-needed vacation. Such things are much more fun! We have become so used to that immediate gratification we lose sight of tomorrow. After all, there’s not much satisfaction thinking about things that might happen. Unfortunately missing that ‘opportunity cost’ today can result in a big missed opportunity tomorrow. Tomorrow does come sooner than we think!
Let’s look at this from another perspective: at some point in life, most of us own a vehicle or a home. Such a purchase comes with a sense of accomplishment and something to be proud of. Certainly, these are things that make life easier. Large purchases also come with expenses. There comes a time when you usually need to do address routine maintenance. Maintenance not necessarily required but something that might alleviate some aggravation down the road. Of course, we can ignore the immediate expense since at that moment in time everything usually seems fine, but once again this has the potential to lead to much larger issues down the road. These are hard decisions to make.
Business is no different. There are a lot of expenses large and small needed to keep things running. Equipment on the shop floor needed to produce and move material, and tools located throughout an office to complete daily operations are all necessary to run a business. It can include everything from copy equipment, calculators, phones, and computer hardware and software. As an individual, resources are not unlimited for a corporation either. Organizations need to take a hard look at their ‘opportunity cost’ or the benefit of investing or choosing one alternate purchase or decision over another. Not so easy since they need to focus not only on the day-to-day but should consider the benefits tomorrow. And since there are usually many individuals depending on these decisions it is even more important to make the right decision at the right time and for the right reason. Corporate spending is much more complicated, or at least it should be, and decisions always need to be looked at for today and tomorrow. Routine maintenance or upgrading needs a decision. Doing nothing is usually not an option.
So, is it now time to evaluate your spending? Whether a personal or business decision it’s never easy deciding but it’s always a good idea to at least start thinking and planning. Like the 401K decision, starting to invest sooner rather than later historically has proven to be the right answer. Investing in the infrastructure in your business sooner over later has historically also proven to be the right answer. Spending is not always as expensive and cumbersome as it may appear, but you never know unless you start the spending process by allocating sufficient time, research, and planning. A little bit of time, energy, and resources today can provide some peace of mind for tomorrow and potentially return big dividends. Although spending comes in many forms, there are many circumstances when not spending or doing nothing is more expensive than doing nothing. Tough decisions…but who said life was easy! Delaying your decision to purchase a new ERP/accounting system may ultimately cost you more money down the road. Don’t let technology pass you by a lot has happened with ERP over the years.