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Straight Talk Technology

Omdia view

IT decision-making always involves a balance between cost, risk, and delivery (the latter including parameters of time and quality), with an impact on any one of these having a knock-on effect on the other two. The impact of COVID-19 will present enterprise IT decision-makers with some stark choices. Given the macroeconomic impact of the pandemic, the majority of businesses will be under financial pressures in at least the short and medium term, which will inevitably put pressure on IT budgets, projects, and workforces.

While technology has played an important role in keeping businesses operating during the pandemic, overall cost pressures will cause reductions in IT budgets. At the same time, greater priority is being put on business resilience and risk mitigation. The outcome is a significant squeeze on delivery capacity, which will be restricted to the most essential and business-critical projects. Enterprises will need to reassess and optimize their portfolio in the light of these pressures and decide which activities should be prioritized and which will need to be put on hold.

While there will be a demand to cut overall budgets, the way in which this is approached can make a huge difference to future capability. Enterprises must be selective in cost cutting, ensuring that spend is aligned with short- and medium-term business priorities, and deferring any longer term upgrades and programs where possible. In parallel, they should carry out a review of IT spend efficiency in areas such as contracts, shadow IT, and resourcing.

With an uncertain future, at least into mid-2021, enterprises should review their business continuity planning, assessing what worked and what didn’t work in the current crisis, and make a working assumption that continuity plans may be called upon again. Think about how to improve the resilience of all areas of IT delivery, and if possible, prioritize weak spots for remediation work.

Increased governance will be important in managing risk, controlling costs, and optimizing delivery. With changes to working patterns, it is important to reiterate (and if necessary refresh) principles of IT governance across all areas of the business. This should include project and change governance, security guidance, and acceptable use policies. Best practice here is to have a set of clear and straightforward policies that are easily accessible and broadly communicated.

For the sectors that have been worst hit by the pandemic, rebuilding will be a difficult process, and will require considerable flexibility and agility. Enterprises must consider how project teams can best be structured for these short-term imperatives, even if this means deferring some business-as-usual activities. Though activity may feel focused on the short-term for some while, it is still important to take an overall portfolio view on both project work and routine IT demand. This enables a clearer view of where resources will have the greatest impact, and provides the business with greater clarity on what is achievable, and when.

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