Home Education A slowing economy is forcing CIOs to reevaluate their priorities

A slowing economy is forcing CIOs to reevaluate their priorities


News services say yes adapting to a shrinking economy in various ways, preparing for the prospect of tighter budgets and evaluating their relationships with technology partners and suppliers.

Concerns about a possible recession are growing. The Commerce Department said on Thursday about the US economy contract for the second quarter in a row. Inflation is also at a four-decade high, which prompted the Federal Reserve to raise interest rates on Wednesday, more growth is expected. While the decline in valuations of public and private technology companies does not directly affect corporate spending on technology, it is another negative signal that could make companies in general more cautious or possibly threaten the viability of smaller technology suppliers in the future.

Spending on information technology in large companies is still mostly stable. Still, CIOs and other IT leaders say they’re starting to prepare for even tougher times ahead. They say they are figuring out which projects will be most important to protect in the event of budget cuts, and are monitoring the health of suppliers that could be vulnerable in a prolonged economic downturn.

Also, they say they are looking into it opportunity to hire valuable workers who lost their jobs in other companies or extended technology contracts on better terms.

“We see the economic climate as a challenge to navigate, but also as an opportunity to attract top talent and potentially gain leverage in the marketplace,” said Rob Franch, the company’s chief information officer.

Transportation services Inc.,

a Houston-based provider of funeral and cemetery services listed on the New York Stock Exchange.

Carriage Services believes now is a good time to invest in technology, and those plans have the full support of the board of directors, according to Mr Franch. “However, our strategy and planning have a narrower margin for error,” he said.

A key factor for managing IT in an economic downturn is maintaining the ability to quickly adjust priorities and expectations for technology spending, CIOs say.

“When there’s economic change, it’s normal and natural for organizations to step back, cut their costs and tighten up,” said Colleen Berube, chief IT officer at the software company.

Zendesk Inc.

Ms. Berube said many tech leaders, including herself, will need to think strategically about spending and make adjustments next year.

When economic changes occur, it’s normal and natural for organizations to step back, cut costs and tighten up.»

— Colin Berube, CIO, Zendesk

“The need for savings is leading to an increased focus on optimization, simplification and automation,” she said. “During this time, demands on technology teams may increase.”

A financial ally,

The Detroit-based bank holding company has a prioritized list of tech initiatives to help control costs and navigate needs, according to Satish Muthukrishnan, Ally’s chief information, data and digital technology officer.

“There are sensible steps we are taking to prepare for a tougher economic climate,” Mr Muthukrishnan said.

For Mark Brooks, IT Director

centen Corp.

managed services company based in St. Louis, this is a moment for CIOs to think carefully about their relationships with IT vendors, some of which may be vulnerable as a result of a long-term economic downturn.

“I feel that the volatility in the marketplace that we are facing today highlights the importance of the relationship between the vendor and the CIO. We are all in this together. Let’s cooperate for the common good,” he said.

Mr. Brooks said relationships with smaller suppliers can be a valuable source of innovation, but in times of economic uncertainty, it’s important to have alternatives ready in case a smaller or more vulnerable company fails.

While vendor support is important to CIOs, they are also looking for opportunities to renew contracts on better terms.

“If you’re at a point where you’re ready to renegotiate or renew a contract, then you definitely look at these opportunities and take advantage of them,” said Tim Crawford, founder and CIO of strategy consulting firm AVOA LLC. .

According to economists and the latest GDP data, the US may be headed for a recession. But this recession may be different from past ones because of one major indicator: unemployment. The WSJ’s John Hilsenrath explains.

Write Isabel Bousquet at Isabelle.Bousquette@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8

Source link

Previous articleWe need to stop teaching high school subjects separately
Next articleHow does your aura work?