The Great Recession of the mid-2000s forced businesses and workers to navigate a period of economic hardship many had never experienced before. Drastic changes rippled through companies around the world, including:
- Innovation projects grounded to a halt.
- Employees were laid off, saw their career trajectories stall out, and faced unprecedented job insecurity.
- Business leaders tightened budgets and looked for ways to keep their companies afloat until the recession ended.
These same hardships also affected companies and their employees in the wake of the pandemic, and continue to do so as we face a period of prolonged economic instability. But the workplaces of today are radically different from the ones that confronted these challenges nearly two decades ago. The pandemic pressed the fast-forward button on digital transformation. And the rise of hybrid work has redefined our understanding of the workplace itself.
Despite how different of a landscape we find ourselves in, there are still many lessons we can learn from previous recessions that can help us navigate the challenges we’re faced with today. Having worked in the IT space for several decades, I learned many of these lessons firsthand – and I’ll share them with you now.
Innovation costs: IT leaders must align technology investments to business objectives.
When the Great Recession hit, I was working for a global architects practice that was midway through a significant expansion into the UAE region. Construction projects across the world grounded to a halt, which put a stop to our expansion. With our strategic project work sidelined, our top priority was now to keep the lights on and make do with what we had.
But this didn’t mean we stopped innovating or looking at ways to streamline and improve the IT services we delivered. In fact, in the midst of the recession we made the decision to move to G-Suite for Business, Google’s SaaS-based email service. And towards the tail end of the recession, we started that project, becoming one of the first UK companies to do so. Looking back, this was a big leap of faith given the economic instability and the immaturity of cloud-based services, but it was a decision that paid off, and it changed the way the company connected and collaborated internally and externally with customers.
These projects represent the first major lesson from the Great Recession that still rings true today: in technology, you can’t stand still. Even during a time of economic hardship, IT needs to continuously look forward and innovate in ways that provide value to their business.
This delicate balancing act – keeping the lights on while continuing to look forward – is why it’s so important for IT leaders to be in total alignment with the business they’re supporting. Say, for example, you’re working in the insurance field. How does that insurance company turn a profit? What distinct value does the business offer; what problems do they solve in order to make money?
Everyone can answer these questions about their employer, of course, but IT leaders must strive to go beyond the surface-level details and learn the objectives of their business inside and out.
When IT leaders have a deep understanding of their business’s objectives, it becomes easier to make decisions around technology investments and understand how technology relates to business value.
Cloud-computing has changed the way we think about technology investments.
Decades ago, this balancing act was harder to get right – as investing in new technology meant major changes to IT infrastructure, changes that would be very difficult to reverse if an investment didn’t pan out as planned. As a result, IT had a tendency to over-buy in terms of capacity, often paying for more software and hardware than we needed.
Now, the rise and maturity of cloud-based solutions means we can increase or decrease capacity with the flick of a switch. This presents IT leaders with an opportunity to become more agile and efficient, an opportunity that was rarer back in 2008.
By leveraging cloud-based vendors and partnerships, we’re now able to be more flexible in times of economic downturns, expanding or contracting the scale of our investments so that they’re always in step with the current business demand.
Hiring costs: Developing talent from within IT departments is more important than ever.
It’s not just technology and the way we use it that has changed since the Great Recession – the responsibilities and required skills of IT workers have also evolved considerably. Companies are facing the costly proposition of hiring for new technology positions, looking for candidates who are qualified to perform jobs that simply didn’t exist a decade ago.
These companies are struggling with this challenge. There’s a major skills gap in the IT hiring market, as there are more open jobs than there are active candidates who boast the skills employers are looking for. As a result, we’re seeing an unprecedented number of open roles remain unfulfilled for months or even years.
This brings me to the second lesson I’ve learned in my long career in IT: it’s important to develop skills internally before looking externally. When looking to fill new roles, I’ve always started by looking at the people around me, seeing who could evolve from their current roles into new positions. Developing internal IT talent is essential today, given the skills gap in the current hiring market – and the huge overhead that hiring new staff represents in the first place.
Finding job candidates with skills in data analytics, automation, AI, and other new technology trends is not only difficult, but expensive. But if you were to bring someone up from within your organization desk and help them develop some of these skills, you end up accomplishing many goals at once:
- You evolve your IT department into a unit that’s prepared for future workplace challenges.
- You save the business a significant amount of hiring resources and money.
- You give individual IT workers an actionable and more sustainable career path.
Throughout my own career, I was given the opportunity to develop my skill set and move up the ranks – so I believe it’s important to give back and allow others to do so as well.
Final Thoughts
Ultimately, how well you navigate a recession as an IT leader depends on your ability to do more with less and be more efficient with what you have – it doesn’t require you to do less.
If there’s anything that previous recessions have taught us, it’s that IT can never afford to stand still. But when your technology and your IT employees are developing in alignment with your business’s objectives, you’ll be able to deliver value in any economic climate.
