In 2025, worldwide IT spending is expected to total $5.74 trillion—a 9% increase from 2024. That spend goes towards an average of 231 apps at each enterprise, with no slowdown in sight. Software investments are made with the best of intentions: increasing productivity and revenue, lowering costs, and reducing risk.
But after a certain point, software can end up working against you—wasting R&D resources, slowing down workflows, and siloing data.
The scale of software waste is immense
While not every dollar invested in software will deliver a ROI, you may be shocked to see just how much of it’s a waste.
Research shows that 80% of a software’s features are rarely or never used—wasting precious product and development time on things nobody values. On the flip side, 49% of all software businesses buy goes unused. For every new SaaS and AI tool your company adds, there’s another one, lying in the shadows, forgotten.
This is bad news for everyone. Even if your company wasn’t born a software company, it’s becoming one fast. AI is speeding up the pace of development and acceleration, with the potential for even more intelligent, personalized experiences. But this will never happen if users don’t adopt the software you deploy. No one wants to build software that only fits 20% of their users’ needs, but AI makes it too easy to write and ship code.
The underlying problem isn’t just software, it’s the software experience.
Our latest report, The hidden cost of bad software, is an executive blueprint to help leaders:
- Speed up user onboarding and time to “aha!” moments
- Reduce customer churn and employee turnover
- Improve your software’s ROI with software experience management
5 times bad software hurts your business
Despite massive investment, employee productivity and engagement are declining. All of IT’s well-intentioned, vetted software investments are failing to deliver on their promises. At the same time, product teams waste precious development resources on features that never realize their intended value.
Bad software experience costs organizations in many ways, like:
1. Low adoption and R&D waste
Nearly half of all business software goes unused, wasting an eye-watering $44 million every month. This is often because companies can’t see how users navigate the software you build and buy, and end-users don’t understand how to navigate and use what you deploy.
2. Security and compliance risk
Frustrated users often abandon secure workflows in favor of faster, less secure alternatives—like turning off multi-factor authentication or turning to shadow IT. These shortcuts open the door to costly breaches and compliance violations, like the recent United Healthcare data breach.
3. Lost productivity and turnover
RingCentral found that employees spend up to an hour a day just navigating between communication apps. That’s six full weeks of lost productivity per year.
To make matters worse, nearly one-third of employees say that poor software experience was a primary driver of their decision to leave a company. Beyond the immediate productivity drain, this attrition forces companies to spend more on recruiting, hiring, and onboarding replacement talent.
4. Missed innovation opportunities
When you don’t know how customers use your software—or why—it’s hard to create a development roadmap to meet their needs. Without behavioral insights and qualitative feedback, product and IT decisions become expensive guesses.
5. Customer churn and revenue loss
Your customers and users inevitably interact with your company through digital touchpoints—whether an app or website. The quality of these experiences directly impacts business outcomes, and a bad UX causes 70% of abandoned online purchases. These frustrate end-users, yes, but they also hurt your growth and profitability.
Companies can’t ignore software experiences anymore
Whether you’re building or buying digital tools, your software experience is too important to leave to chance. Leading companies are already practicing software experience management (SXM)—optimizing digital experiences—to help you lower costs, promote compliance, and grow faster.
Get The hidden cost of bad software to learn:
- Why SXM has never been more important for IT, revenue, and product teams
- How to develop an enterprise-grade SXM program in your organization
- What the modern software development lifecycle looks like—and how to start using it
Ready to try the world’s leading SXM platform? Start using Pendo for free today.
