At times of economic uncertainty and downturn, the natural instinct of businesses and individuals is to reduce spending and focus on building up cash reserves. Given the current macroeconomic and geopolitical landscape and ongoing debates among economists as to whether major economies such as the USA and the UK are already technically in a recession, it would be understandable for enterprises to begin battening down the hatches.
Sometimes spending cuts and asset sell-offs are unavoidable, but there are good reasons for enterprises to pause and consider whether investment may offer more palatable and beneficial alternatives. There are various studies demonstrating that companies that invest in sales and marketing during a recession often fair better than those who don’t, and some may even emerge stronger. Investment in technology solutions can offer similar benefits.
Digitally transform to survive economic uncertainty
GlobalData’s conversations with enterprises highlight there is an ongoing wave of technology refresh projects underway with the majority of businesses stating that they are already more than halfway through their digital transformation processes. However, these projects have largely focused on responding to the impact of Covid-19.
There has been heavy investment in collaboration technology (e.g., video/web conferencing), digital sales channels, and cloud adoption to accommodate increased employee expectation for flexible working and a move to platforms that can scale more easily as businesses grow and contract.
This investment is certainly valuable in responding to economic uncertainty. Collaboration technology can reduce travel costs and allow businesses to close offices. Cloud adoption enables business to turn off inefficient private data centers. But businesses need to look deeper.
AI can spot the juiciest low-hanging fruit
Businesses should be aware that digital transformation projects can deliver quick wins that create the illusion of significant progress when the real value may require a little more effort to unlock.
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Often one of the biggest barriers for businesses is that they cannot easily see where the real opportunities for efficiency and improvement lie. Artificial intelligence (AI) and machine learning (ML) is one of the technology areas that can offer a deeper level of insight and even highlight quick-to-achieve solutions.
One great example is in the contact center environment. COVID-19 has increased the importance of remote customer engagement – be that sales or support. AI is being used to automate the most repetitious tasks thereby freeing agents to deal with more complex and/or potentially revenue generating customer interactions.
The result is happier customers, increased agent job satisfaction, and a fast return on investment. Enterprises surveyed by GlobalData suggested that they were seeing significant returns in less than a year.
Climate change and rising energy prices have combined enterprises commitment to sustainability. Technology is again playing a critical role in achieving the best results. In energy intensive environments such as manufacturing, utilities sites, and natural resource extraction, AI and ML are combining to enable businesses to make progress towards carbon neutrality and in doing so achieve significant savings when it comes to energy efficiency.
The investment delivers additional benefits such as reduced maintenance costs and site downtime, and improved worker safety. And, again, GlobalData’s research shows that benefits can be achieved more quickly than might be expected. Intelligent technology investment can deliver cost reduction without harming a company’s ability to do business and may be crucial to weathering economic uncertainty.