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To help navigate the tension between cost-cutting and critical investments, Forrester has created a detailed checklist that CIOs and their business partners can look at to adjust their budgets.
The old playbook for how CIOs can manage tech budgets through tough times will not work for today’s pandemic. While CIOs and their business partners are under intense pressure to cut tech budgets, technology plays a vital role in business survival and success during this recession.
Theand efforts to contain its threats have triggered the deepest recession since the Great Depression. Most companies face the prospect that their 2020 revenues will be down by 10% to 25% from 2019 levels — with some suffering devastating revenue drops of 30% to 60% or even higher. Yet to meet the pandemic’s challenges, these same companies must maintain if not increase their tech spending on critical capabilities like security, risk management, customer experience, online commerce, employee experience, and work-from-home arrangements.
To help navigate the tension between cost-cutting and critical investments, Forrester has created a detailed checklist that CIOs and their business partners can look at to adjust their budgets. Our approach to tech budget management in the pandemic recession recognizes that not all companies are in the same boat. While some struggle for survival, others are adapting and some are growing. In fact, even in the same industry, different businesses (and even parts of them) can be in a different state. Once leaders understand their mode, they will need to clarify top-level goals and take specific actions to create the right tech budget for their current situation, as well as to react and adjust as their business conditions change in the future.
Firms Should Align Their Tech Spending Based On Pandemic Priorities
These are just some of the nuanced ideas addressed in our tech budget checklist. It covers over 70 individual line items typical of tech budgets, covering every budget area, including new project spending on contractors, systems integration services, and new software licenses and subscriptions for front-office operations, as well as back-office systems, computer and communications equipment, existing cloud software subscriptions, software maintenance fees, tech outsourcing, telecom services, and tech staff.