In times of economic uncertainty, every IT executive asks the same questions: what can stay and what can go?
Anyone who has worked through recessionary times in the global economy – as most of us have, as recently as 2020 – has witnessed or been a part of layoffs, furloughs, or even more drastic consequences, like an entire IT department or service contracts being cut and canceled overnight. The modern workplace succeeds or falters based largely on the value and efficiency of its technology – and saving money today by cutting a certain technology can severely cost companies tomorrow.
Digital workplace innovation isn’t just an investment in DEX – it can also be a cost-saver.
The largest mistake IT leaders make when cutting technology costs is that they often answer the following questions on a purely superficial level:
- What does the tool cost?
- What functions does it perform?
- Can we live without performing those functions?
Don’t get me wrong – these are the important questions that should be asked when determining a tool’s value. But the answers are often far more complex than leaders believe. This is why IT must make sure they communicate the value of workplace technology more proactively and leaders must take the time to understand the value – or not and move along for “easier” financial cuts.
Here’s an example. Let’s say a company just started paying for a tool that enables them to see deeply into their employee devices’ usage and performance metrics. A business leader might say:
“We don’t have to renew our subscription to this tool this year. It seems like all of our employee devices are performing well enough – and even if this means we have to deal with a higher volume of IT issues next year, that’s a tradeoff I’m comfortable making because we need to cut costs now.”
On the surface, this hypothetical business leader makes a compelling argument. But what if that innovative solution actually can help them cut costs now? Let’s say they keep that tool in their tech stack, and their IT department is able to utilize it and see that:
- A majority of employee devices are using 16 gigabytes of RAM.
- Many of those employees can perform their key responsibilities with devices that only require 8 gigabytes.
- Cutting the RAM in half would save roughly $100 per device.
Let’s say the IT department uses this information to downgrade the next 5000 devices they order from their supplier from 16 gigabytes to 8 gigabytes of RAM on a subset of their employee base. That ultimately leads to $500,000 in technology savings with no negative impact on employee experience — $500,000 that the company wouldn’t be able to save if their IT department lacked the ability to see and analyze this technical data.
Far too often, this sort of technology budget cut happens without consideration for the impact on user experience. The above example is not complex, but it showcases how IT can leverage data to improve their bottom line without adversely impacting user experience.
Companies must continue to innovate if they want to be prepared for a deepened recession.
Regardless if you agree with economists predicting an inevitable recession, publicly traded enterprises are already planning for the worst. The end result often is investing in as little resources as you can get away with, not backfilling critical enterprise IT roles, or making your technology stack too lean at the cost of productivity and security. Digital transformation isn’t going to hit the brakes because of a dip in the stock market, and digital workplace leaders can’t do so either.
Instead, they must look deeper into the reasons why they adopt each tool in their enterprise. Of course, there’s not much value in paying for a solution because it’s the trendy thing to do or because their competitors use the same technology. But when they see that the right technology can turn an initial investment into major cost savings down the line, that’s when they’re able to utilize their technology stack to pivot with the economy and be optimally positioned for economic recovery.
