Growth is always the number one priority for the C-suite. But new data also shows that when there are high levels of alignment across marketing, customer experience, and digital, companies report 2.4 times higher revenue growth than those with no alignment. Among these organizations, respondents are 1.6 times as likely to say that their IT organization is highly aligned with a technology planning strategy that connects and integrates customer-facing and behind-the-scenes capabilities.
Forrester’s Budget Planning Survey, 2023, shows that 81% of US enterprise technology decision-makers anticipate their organization’s technology investment increasing over the next 12 months, including nearly half seeing budgets for AI capabilities growing more than 5%. Tech leaders must leverage this opportunity to translate rising technology budgets into aligned, growth-focused business initiatives across their company. Forrester’s Planning Guide 2024: Technology Executives provides recommendations for where to invest, optimize, and experiment to enable, create, and amplify growth.
For 2023, Forrester recommended a steadfast approach to technology decisions to reconcile any hasty investments made in the pandemic years. With that work now forming the foundation for future business growth, it’s time to accelerate into 2024 with a pragmatic approach to innovation — for example, using artificial intelligence to enhance employee autonomy and expand capacity. Great tech leaders will also look to further their impact on the customer experience, deliver effectively on scope and scale, and shape new strategies to adopt emerging technology quicker. It starts with focusing on three primary areas:
- Software to optimize and unlock superpowers. Two-thirds of US enterprise tech leaders anticipated increasing investment in software. Advanced software capability is a critical power to keeping a competitive advantage. Energizing everyday tasks with automation and AI within software built for purpose will enhance the customer experience, foster innovation, and streamline product development.
- A perpetually modern infrastructure. Maintaining a modern infrastructure is a perpetual motion aimed at optimizing costs, but more importantly, it allows companies to confidently capitalize on expansion or future business opportunities. In Forrester’s Budget Planning Survey, 2023, more than 65% of US enterprise technology decision-makers anticipate investment in network infrastructure, end-user hardware, and data center infrastructure.
- Human capital to innovate. Artificial intelligence isn’t killing the demand for talent or trusted partners anytime soon. And 54% percent of tech leaders are anticipating increased organizational investment in staffing/personnel while a whopping 68% anticipate increasing investment in services. Investments in a highly engaged and fully supported workforce extend both your capabilities and competencies. Combined with a capable roster of partners, you can quickly configure your workforce and manage the investments required to capitalize on new opportunities and accelerate growth.
Obsess On Aligning Tech Efforts To Business Growth
Aligning to growth means focusing technology planning and investment on customer value and revenue-generating initiatives. To do that, technology leaders must be actively engaged with the business — 43% of US enterprise technology decision-makers in digital-related functions said that they are regularly involved with refining or rethinking their business model. Truly understanding the business impact allows tech leaders to prioritize investments, divestments, and experiments effectively around business outcomes.
Evaluate all technology that touches your customer experience. Technology touches every aspect of the customer experience, yet only half of US enterprise technology decision-makers said that they are regularly involved with managing customer-facing websites or apps, while 88% of the most advanced organizations plan on significantly increasing spend on customer management and relationship tech. Tech leaders must be involved to ensure that you are maximizing investment from front to back. To demonstrate market impact, find and invest where key points of differentiation truly need to exist alongside customer journeys and product and service lifecycles.
Draw down technical debt so you can reinvest in the future. The urge to cut costs in turbulent economic times is real and sometimes warranted. But Forrester recommends that you defend those dollars and redeploy the funds toward modernizing your tech stack, with customer value and business growth in mind. Our research shows that 88% of the most advanced organizations plan to significantly increase their infrastructure and operations investment, compared to 63% of their traditional peers.
Master this AI moment to create the conditions for innovation. Generative AI is “the” story in tech right now, but unlike other emerging technologies, this one can be applied to the new, the mundane, and just about any business process across any category. Use this AI moment to adopt a “one to many” approach that will enable you to deliver a broad range of solutions across operations and provide sustainable momentum that conditions your whole company to curiously innovate, share and transfer knowledge, and adopt changes and innovations faster over time.
For more details about technology executives’ budgets and all the areas where we recommend increasing, defending, and reducing investment, check out the following resources: