Spring has arrived with a familiar backdrop for business leaders: elevated volatility, fragile supply chains, and mounting economic friction. Energy markets are again under pressure, global conflicts remain unresolved, and trade policy uncertainty is reintroducing cost and planning risk across industries.

Our latest report, Geopolitical Conflict Increases IT Budget Scrutiny And Security Risks (client access required), examines today’s volatility through a technology lens and outlines the actions that leaders must take to manage cost pressure, strengthen resilience, reduce risk, and lead their people through sustained uncertainty. Key recommendations include:

Prepare For Budget Scrutiny As Energy Costs Rise

Geopolitical conflict is amplifying existing pressures as rising energy costs, persistent inflation, and slowing growth collide with skepticism about technology spending, particularly large AI investments. This is forcing hard choices about which platforms and AI investments truly matter. As tech leaders look to defend their AI investments, they’ll need to move beyond experimentation and small-scale productivity gains to enterprisewide strategies that deliver measurable outcomes. That means prioritizing high-value use cases, scaling agentic AI for future use cases, and embedding responsible AI governance.

What’s different now:

  • Budget scrutiny forces explicit platform and AI trade-offs.
  • AI investment is judged on business outcomes, not experimentation or productivity optics.
  • Tight memory supply and record-low data-center capacity raise the cost of mistakes.

Show Your Resilience And Reduce Risks As Cyber And Kinetic Attacks Increase

As conflict increasingly plays out across physical, digital, and cyber domains simultaneously, technology leaders must assume disruption rather than plan for stability. Cyber activity is rising alongside kinetic conflict, as evidenced by the recent attack on the Fortune 500 medical technology firm Stryker by an Iranian hacker group. While banking, defense, manufacturing, government, and critical infrastructure are obvious targets, CISOs of all industries shouldn’t rule themselves out as the conflict spreads.

Heightened geopolitical volatility also draws attention to the risks of dependencies on foreign power sources, vendors, and service providers. This is the moment to assess those dependencies and decide what can be fixed and what should be mitigated. Rather than attempt full sovereignty across the entire IT stack, most private sector organizations should pursue minimal viable sovereignty — focusing on essential protections for specific workloads while avoiding unnecessary complexity.

What leaders must assume:

  • Cyber disruption is part of geopolitical conflict.
  • Energy and capacity constraints won’t normalize quickly.
  • Sovereignty decisions create new security trade‑offs.

Lead Your Employees With Empathy

Geopolitical crises don’t just disrupt systems — they strain the people required to keep those systems running. Workforce continuity can no longer be improvised as safety risks and regional instability force rapid shifts in where work happens and who can do it, often while infrastructure and cloud capacity are also under pressure.

Review your business continuity plans, preparing to use some of the same continuity strategies of the pandemic as needed (e.g., supporting work-from-home and other flexible work policies or shifting work to other regions). Be mindful of the emotional toll that employees may be bearing — and treat burnout as a business risk, particularly as it compounds execution risk just as leaders are making higher‑stakes trade‑offs. Stay the course on upskilling employees for AI given that the transformation of business and work through AI and agentic workflows won’t slow — but clearly frame it as augmentation and value creation rather than implicit workforce reduction.

Where leadership gaps surface:

  • Workforce availability faces new pressures, forcing global flexibility.
  • Burnout degrades decision quality under pressure.
  • Ambiguity around AI intent slows adoption, skill building, and response.

What To Do Next

Geopolitical volatility is not something technology leaders can wait out. It demands sharper trade‑offs, faster decisions, and more visible leadership — across budgets, platforms, risk, and people.

Forrester clients can read the full report for our complete list of recommended actions to take now. You can also schedule a guidance session or inquiry to discuss leadership in a time of continued chaos.