How CIOs Are Budgeting for Post COVID-19
The pandemic has caused enormous uncertainty surrounding IT budgets. In fact, research by Pulse suggests that 23% of budgets are frozen, and 49% have declined. As a result, many CIOs have been forced to shift priorities to make the most of their limited budgets.
Looking towards the future, we’ve turned to IT leaders to learn what budgets will look like after the pandemic, and how this could impact customers.
IT Investment After the Pandemic
“The economic and health impacts of COVID-19 have exposed numerous holes and issues within many industries that CIOs of businesses are now looking to address,” said Prem Khatri, VP of operations at Chetu. The threat of a second wave or resurgence of the virus in the future is causing CIOs to adjust their IT roadmaps and budgets.
“Based on the issues many businesses faced,” Khatri added, “CIOs are and will be turning to invest in new solutions to help reduce the overhead costs of the business and prepare for future crises.”
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Automation is a crucial component of success in business, and software that continues to free up time and resources will help businesses save and recoup sorely-needed capital,” Khatri said. More specifically, he believes companies will invest in custom integrated software that automates key business processes in document-heavy or manual industries. “These tactics will help automate much of the day-to-day work of the business,” he explained, “and allow employees to be far more productive in the workday.”
Enterprise Resource Planning (ERP)
“Additionally, ERP software is another solution that businesses will invest in,” Khatri said. With employees working from home and office spaces underutilized, many companies realize that the old way of doing business isn’t feasible anymore. They’ll be looking for ways to better utilize their resources and look to become a more agile organization that’s ready for unforeseen circumstances. “ERP solutions will help companies streamline their business and help save money and capital to make them leaner and more efficient.”
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“The sudden shift to remote work required immediate IT spend for many organizations who were not set up to operate in flexible, virtual environments,” said Ian Pitt, CIO of LogMeIn. The shift away from investments like wi-fi, switches, firewalls, and other hardware for the office may continue. “The money saved will have to be injected into securing the infrastructure that employees leverage while working at home,” Pitt explained. And for many companies, this will also involve a rapid shift to the cloud. Pitt said, “CIOs must start thinking about how the ‘hybrid workforce’ will reshape their investments.”
“In response to the pandemic and economic environment, we’re redefining and refining our business processes and systems to deepen our engagements with our customers,” said Prasad Ramakrishnan, CIO at Freshworks. That means many companies are investing in customer engagement, analytics and security capabilities. “When choosing tools,” Ramakrishnan continued, “CIOs will look for those that provide a quick ROI on their investment.” With a tight budget, companies can’t afford to invest in “shelfware,” which can take months to derive any value from.
How Budgets Will Affect Customers
“In today’s landscape, customers are harder to win than ever before,” Ramakrishnan said. That’s why CIO budgets are focusing on retaining and expanding existing customers to ensure business continuity. “With everyone working from home, the lines between your email, chat, caller and conferencing systems are as thin as the lines between your workplace, dining place and resting place,” he continued. Today’s customers want frictionless omnichannel experiences, and companies are recognizing the need to invest in technology to enable this because they can’t afford to lose existing customers.
“As we decide how to allocate our budgets internally,” added Pitt, “one of the main considerations is how to keep the business running and maintaining the same service expected by our customers.” How companies equip their workforce, therefore, directly impacts consumers as well. “Budgets will shift to streamline internal work, allowing organizations to maintain a consistent level of service and production.” This includes investing in not only internal tooling and processes but facilitating remote hiring, onboarding and training as well.
“Additionally,” Khatri said, “with so much emphasis being placed on digital innovation, customers can expect to continue to embrace a more digital commercial experience.” There will likely be an explosion in ecommerce, telemedicine, virtual events, and other digital-first initiatives that significantly improve the customer experience in a post-COVID world.