Despite some mixed economic signals and various business challenges around the world, technology executives must approach the 2023 planning cycle with a growth mindset. The lessons from the pandemic are clear: Technology will continue as a beacon to help businesses better connect with customers. The most customer-obsessed organizations accelerated their move to digital during the pandemic and will continue to do so going forward to deliver innovative customer experiences. It’s up to their IT leaders to align technology architectures and build the IT roadmap to ensure a successful digital transformation. And that requires spending.
Forrester’s US Tech Market Outlook, 2022 report showed an acceleration in tech spending since the start of the pandemic. US tech spending increased 9% in 2021 and is projected to hit 7.2% year-over-year growth by the end of 2022. Further, Forrester’s recent budget pulse survey found that 67% of US IT professionals predict increasing tech budgets over the next 12 months, with 26% of respondents expecting more than a 5% increase in their tech spend.
But increasing spending at a time of looming geopolitical friction, widespread inflation, and chronic supply chain constraints means you have to have a plan and stick to it. Our Planning Guide 2023: Technology Executives gives you the necessary data and information to navigate these headwinds without sacrificing growth and to ensure that increased tech spending is put to the right use. A few of the points we dig into in the planning guide include:
- Realize value before reducing costs. Align technology investment decisions with the same risk and opportunity framing as the business itself. The need to rapidly translate technology decisions into business value has never been more important. No matter what, technology executives should keep their company’s customers’ needs and expectations central to their investments.
- Reduce costs that do not move the customer forward. Tie technology spending directly to the delivery of business objectives and customer value. Don’t let tech funding become ineffective when negotiating the seemingly endless tradeoffs that exist. Technology executives should take a cost-to-value approach and empower the IT organization to strengthen business outcomes.
- Focus on pragmatic innovation. Uncover where the IT organization can become more valuable to the business. Use experimentation as an opportunity to focus innovation on the pragmatic rather than the dynamic. Technology executives should prove out technologies, concepts, and capabilities that can directly impact the top or bottom line.
Above all, for the year ahead, use your customer as your north star and remain steadfast with your decisions and commitment to deliver business value. And if you need help, Forrester has been helping clients manage tricky waters for many years.