I don’t know of a worse business-journalism cliché than the one that says, “It’s a recession, so business is holding back on technology spend.” Google the combination of “technology spend” and “recession” and you’ll quickly see what I mean – earnest admonitions like “get those budgets approved now for additional automation and technology spend… before the economy settles into pre-recession”.
Any pronouncement on “tech spend” has two problems: first, that I don’t accept “spend” as a noun, and second (much worse) that I reject the idea of a shapeless blob of budget labeled “tech.” We would not have a budget for “space” that doesn’t know a warehouse from an office – nor a budget for “vehicles” that doesn’t know a dump truck from a fighter plane. Let’s not make careless (and illiterate) generalizations on “tech” that become self-fulfilling prophecies of stagnation; instead, let’s figure out where corporate spending needs to continue or even grow — with focused urgency, rather than spend-it-while-you’ve-got-it recklessness — in a moment like right now, when the year ahead looks challenging.
Since many disagree on what a “recession” even is, let alone when it starts or ends, let’s fall back on another cliché that says “everybody’s in the hole.” Plenty of C-suites are feeling that way right now, but there are wildly different ways to respond to that situation. Some are hanging curtains to make the hole less ugly: in real-world terms, that might mean killing unprofitable products to make the margins look better today, ignoring resulting long-range costs of failure to attract the new entry-level customers who represent future profits. Dig up the corpse of the pre-bankruptcy General Motors, from the hole where it got buried, to ask how that works out.
Other companies might be setting up tables and chairs at the bottom of the hole to make themselves more comfortable there: in real-world terms, that might mean deferring useful automations and integrations, or cutting back on employees’ productivity tools. Can the resulting expense reductions make the bottom of the hole a less painful place to be? Perhaps, for a while, but the walls of the hole are still there; the opportunity to take new territory is still impaired.
If we want to do better, let’s start with our third cliché today: the one that says, “When you’re in a hole, step one is to stop digging.” Let’s do better than that. How about, “Step zero is to stop digging. Step one is to start climbing,” or perhaps even “Step one is to build rockets and start launching.” At a minimum, buy a ladder; better still, buy a rocket belt, and own the air space above the field of battle while competitors are still measuring their holes.
In real-world terms, what does that mean? It means investing in the customer connection capabilities that make your company the easiest to discover, and the simplest to engage as a provider. It means investing in the machine intelligence capabilities that let an employee with two months’ experience deliver levels of next-best-action execution, and customer-serving insight, that used to require two years’ experience to achieve. It means creating new customers, and strengthening the loyalty of current customers – the only two sure pathways to sustainable profitability.
We need to speak to decision makers in a language of accomplishment, not merely settling for “success.” I once heard a marketing manager say that at his company, there was a strict rule against naming any project or any budget line item with a label describing a technology to be acquired or deployed. No project, for example, could be called “ERP upgrade”, rather, it would have to be named (and financially justified) under a label and from a viewpoint like “Supply chain visibility improvement” or “Order fulfillment acceleration.” At that company, it is simply not possible to have an outcome that’s the IT equivalent of “a successful operation, but the patient died” – because their definition of “success” is never buried under a “tech spend” line item. The intended accomplishment is always part of the conversation.
Whether you’re the buyer, or the seller, shun the label of “tech” in both the budget and the sales pitch. A company might say, “things are tough, we’re not buying tech right now.” Both inside and outside the company, someone needs to say “you don’t postpone investments that end the tough times sooner – especially when competitors are hiding in their holes.”