Technology organisations have continuously faced challenges related to controlling ever-increasing IT expenses caused by accelerated customer/client demand for more intuitive, accessible, speedy digital solutions. The emergence of cloud computing has shifted the ownership of IT spending decisions from the procurement function to the hands of cloud engineers and developers which has made it harder to control the constant growth of IT budgets.

IT and the Covid-19 Pandemic

The Covid-19 pandemic has significantly shifted the way companies deliver products and services while trying to ensure the safety of consumers and employees. Government mandated protocols have forced organisations to alter their business models to comply with state and federal regulations. The result has been a focus on contactless service delivery and the expansion of remote team to maintain ongoing business operations while recruiting technical expertise to enhance technological capabilities.

The outcome of this new business landscape has been a dramatic increase in technology spend related to scaling capacity to meet customer demand for technology services, investing in collaboration solutions to enable remote working, developing new application capabilities that allow customers to access services from home, and improving automation to streamline operations.

The Remote Workforce

The pandemic forced companies in non-essential industries to close corporate offices and physical locations to help stop the spread of Covid-19. This unforeseen anomaly compelled organisations to increase spending for laptops, mobile devices, collaboration tools, and cybersecurity to support the new, decentralised workforce.

“A survey conducted by Price Waterhouse Coopers in 2021 found that 72% of US executives were planning to increase IT spend to invest in tools for virtual collaboration while 70% and 64% of executives were planning to invest in secure VPN connectivity and training for virtual workforce management, respectively.”

In the aftermath of the pandemic, many organisations have opted to maintain remote and hybrid working options since it has allowed them to widen their talent pool and reduce overhead. Ongoing labour shortages have also strongly contributed to the need to hire remote workers to fill critical roles. An increasing portion of the workforce now expect employers to allow them to work from their home office.

Cloud Adoption

The Covid-19 crisis has been an unexpected catalyst for increased cloud adoption as companies rush to scale their IT footprint to meet the surge in demand caused by growing traffic to websites and applications. IT departments have leveraged public cloud to maintain systems availability, mitigate business risks associated with diminishing legacy skillsets, improve disaster recovery, enhance business agility, and expand remote working capabilities.

“According to “The Flexera 2022 State of the Cloud Report”, 66% of respondents surveyed stated that their cloud usage is higher than initially planned. When asked about top cloud initiatives for 2022, 59% of respondents identified optimising existing cloud spend as a top priority.”

The increase in cloud adoption has also required companies to make significant investments in cybersecurity to secure the growing volume of sensitive customer data stored in the cloud and to fortify network security to support more decentralised operations.

Covid-19 has also accelerated growth in SaaS solutions since they support the emerging need for employees to remotely access company resources, data, and analytics. The low upfront investment required to implement SaaS platforms has made it easy for organisations to replace legacy systems with tools that offer enhanced capabilities and accessibility. SaaS solutions also reduce the cybersecurity resources required to secure data and IAM since those responsibilities are managed by the SaaS provider.

Automation and emerging E-commerce technology

Workforce shortages caused by Covid have pressured companies to implement creative solutions to fill personnel gaps. Automation technologies such as robotics, RPA/IPA, chatbots and artificial intelligence have allowed companies to replace headcount with technologies that streamline redundant processes.

Emerging technology in ecommerce has allowed customers to shop using web conferencing solutions such as Zoom, augmented reality (AR) and virtual reality (VR) while protecting their personal health. Investments in Fintech solutions and digital payments have made it easier than ever to complete transactions via cloud-based applications and company websites. Online ordering, 2-hour delivery, and curbside pickup options have contributed to a large percentage of sales volume for most corporations as they transition from bricks and mortar locations to virtual sales channels in the post-Covid era.

The implementation of automation and cutting-edge e-commerce technologies has added additional spend to corporate IT budgets. In the coming years there will be a heavy focus on optimising usage and costs related to cloud-based business solutions to enable companies to maximise ROI and increase profits.