The Impact of an Economic Downturn on Digital Transformation

“IT became a lifeline for rapid digital change rather than keeping the lights on or reconfiguring networks, VPNs, and teleconferencing tools. It’s not a power shift, but a realization of untapped value.” says Patrick Hubbard, Senior Technical Product Marketing Manager, and Head Geek of SolarWinds in an exclusive interview to Enterprise Talk

ET Bureau- How will managing IT budgets determine the future of digital transformations?

Patrick Hubbard- While Gartner predicts revenue uncertainty will start to abate in 3Q20 with CIOs beginning to normalize IT spending, overall global IT spending will grow at -7.3% over 2019. This means we aren’t out of the woods yet. It’s highly likely that IT pros will have to continue to work with limited resources as they adapt to whatever might come next. It will have a natural domino effect on digital transformation projects, even with new skills and efficiency gained responding to the challenges of 2020.

As tech teams further balance and re-prioritize resources, they’re also choosing digital transformation projects more carefully and effectively. Overall they’re setting achievable goals based on real-world business needs and expectations, not what’s futuristic. There’s just no time to support bleeding-edge experiments when you need to keep the business in business. The real question is, will teams remain focused on digital transformation in the future, or will we return to traditional patterns?

ET Bureau- How has the global pandemic and remote work environment influenced tech decisions?

Patrick Hubbard– Many routine and deferred tech decisions suddenly became business-critical decisions to support remote work during the global pandemic. Interestingly, both IT professionals and leadership quickly made significant shifts and allowed some high-profile, “aspirational” projects to fall by the wayside to do so.

Read More: How Industries are embracing Automation amidst the COVID-19 crisis

The pandemic offered a rare opportunity for businesses to collaborate with IT to solve fundamental, shared challenges and see technology in a new light. IT became a lifeline for rapid digital change rather than keeping the lights on or reconfiguring networks, VPNs, and teleconferencing tools. Some companies even gained a new perspective, discovering IT is more than a team of digital gardeners; but possessing the skills and insight to affect rapid digital transformation to the cloud, SaaS, virtual desktops, and more. It’s not a power shift, but a realization of untapped value.

Consider a data point. This year’s IT Pro Day 2020 survey: You Were Built for This found 64% of surveyed IT pros were boosted with a new sense of confidence during COVID-19 despite the list of ensuing challenges, including reduced budgets, more significant decision making responsibilities, and longer hours. The survey also found teams felt more empowered to bring ideas to the table and felt more prepared if faced with unexpected challenges in the future.

ET Bureau- How will IT teams influence tech decisions that can support the business with limited budgets?

Patrick Hubbard- Of all enterprise departments, perhaps none are as adept at doing more with less than IT. It’s in their cost-center charter. As organizations adjust to this new circumstance, business operations will continue to evolve, but asymmetrically depending on vertical, geography, and other forces for each business. IT teams will be at the heart of those changes regardless of the budget. Internal processes will need to be rethought according to 31% of IT pros, specifically to focus on upskilling to accommodate the continued change of pace and meet the business’s needs. Because of IT’s achievements during the pandemic, even with a smaller budget, IT has an opportunity to maintain its again re-earned seat at the table to communicate more effectively with executives going forward.

Read More: Preparing IT Teams for the Second-wave of COVID-19 Outbreak

ET Bureau- According to you, what are the critical elements that IT organizations need to prepare for this time of economic uncertainty?

Patrick Hubbard- First, as is always the case during uncertainty, identifying and assessing options is more important than ever. Just as you’d take your car for an inspection to see if you could keep it running a couple more years, one of the first actions for IT is to increase monitoring visibility across their infrastructure. And because of increased complexity from hybrid cloud operations, teams invest more than is typical in a downturn. Eliminating sprawl, identifying overprovisioned or idle resources, verifying OpEx invoices vs. expectation, ensuring good user experience, and more are necessary steps. IT will need to survive reduced budgets and make smart transformation decisions to keep ahead of the competition.

Second, IT must remain in pandemic-response close communication with the business, to ensure the most cost-effective combination of critical need, catch-up rework, and strategic projects. The final limiting factor will be budget, and as budgets shrink, IT always benefits from clear direction and increased business requirement detail.