Software Budgets Are Being Wasted on Over-Engineered IT Tools

Why It Matters

The misallocation of software spend erodes up to 7 % of annual revenue and depresses productivity, prompting companies to streamline their tech stacks to recover ROI and improve employee morale.

Summary

A Freshworks survey of more than 700 IT, CX, finance and operations professionals found that one‑fifth of software budgets – roughly $1 of every $5 spent – is wasted on over‑engineered tools that fail to deliver expected ROI. Over half of respondents (53 %) missed their ROI targets, with 43 % reporting budget overruns and 32 % dissatisfied with vendor support, while employees lose an average of seven hours per week navigating an average of 15 applications and four communication channels. The study highlights pain points such as non‑customizable workflows for CX teams, poor integrations for IT, and a clunky user experience, which have contributed to burnout and turnover. Freshworks’ CEO Dennis Woodside warned that the very software meant to accelerate business is now slowing it down.