Episode 2: What is technology?

What is technology? A simple breakdown for procurement professionals

In today’s fast-moving world, it's easy to get lost in the jargon of technology. Acronyms, buzzwords, and constantly evolving terminology can make even the most experienced professionals feel bamboozled. But at its core, technology is simple: it is the combination of tools, systems, and people designed to make a business process work better.

Whether you are looking at automation, cloud systems, or communications, all technology serves the same purpose: to improve how a business operates. To make sense of it, it helps to break technology down into three main categories: hardware, software, and services.

Hardware: the physical foundation

Hardware is the part of technology you can touch. It is the physical equipment that makes everything else possible.

Think of laptops, mobile phones, servers, or even the onboard systems of a boat. Each is an example of hardware - tangible tools that provide the platform for software to run. Without reliable hardware, no amount of clever programming or service delivery will get far.

When making procurement decisions, understanding the lifespan, performance, and compatibility of hardware is essential. It sets the stage for everything else that follows.

Software: the digital engine

Software is what brings hardware to life. It includes the programs, applications, and operating systems that tell hardware what to do.

From everyday productivity tools to highly specialised industry platforms, software is one of the most commercially complex areas of technology procurement. Licensing terms, subscription models, and usage rights all affect cost, flexibility, and compliance.

Although the range of available software can feel overwhelming, at its core, it all serves the same purpose - to help hardware perform the tasks a business needs.

Services: connecting it all together

The final piece of the puzzle is services. This covers the people and processes that bring hardware and software together to deliver a working solution.

Services can include everything from installation, integration, and support to consulting, cloud management, or ongoing maintenance. They ensure that the technology delivers the intended business outcome, not just a collection of disconnected tools.

From a procurement perspective, services often represent the most variable element in a deal. They can make the difference between a solution that simply works and one that delivers lasting value.

Bringing it all together

Almost every modern technology - from AI and quantum computing to communications and cloud platforms - fits into one or more of these three categories: hardware, software, and services.

By thinking in these terms, procurement professionals can simplify complex discussions, identify interdependencies, and make better commercial decisions. Understanding these foundations is the first step to managing technology strategically rather than reactively.

To learn more about how your organisation can manage technology strategically, get in touch.