TL;DR: Research reveals that 20% of software budgets are wasted on unnecessary complexity, potentially haemorrhaging 7% of annual revenue. More than half of organisations fail to achieve expected ROI from software implementations, with employees losing seven hours weekly to inefficient tools.

A fifth of software budgets is being squandered on unnecessary business complexity, according to new research from Freshworks surveying over 700 IT, customer experience, finance, and operations professionals. The study found that 53% of respondents failed to achieve their expected software return on investment, with 43% noting projects ran over budget and 32% criticising vendor support.

The financial impact extends beyond direct costs. Failed implementations, underused tools, and hidden expenses contribute to the waste, potentially costing organisations up to 7% of their annual revenue. This represents a significant drag on business performance driven largely by technological over-complication.

Productivity Lost to Tool Overload

Despite software being designed to enhance workplace efficiency, the average employee loses approximately seven hours per week due to inefficient software systems. Workers face technological overwhelm, accessing 15 different software tools and four communication channels daily. This fragmentation creates friction that negates the productivity gains software is meant to deliver.

Different departments experience distinct pain points. Customer experience teams struggle with non-customisable workflows (42%), excessive tools (36%), and slow routine tasks (33%). IT teams face challenges with poor integrations (36%), siloed tools (32%), and dated or clunky user experiences (28%). The common thread is complexity that impedes rather than enables work.

Human Cost of Software Complexity

The impact extends beyond productivity metrics. Nearly one in five respondents (17%) reported knowing someone who quit or experienced burnout specifically due to software issues. Freshworks CEO Dennis Woodside noted: “The very tools meant to help businesses move faster are now holding them back.”

The report advocates for streamlined technology stacks with a people-first approach. Unifying systems and eliminating unnecessary complexity can improve both ROI and worker morale. However, achieving this requires organisations to critically assess their tool portfolios and resist the temptation to deploy software solutions without considering integration and user experience implications.

Source: TechRadar