"My tech budget got cut, now what?"

We have asked our Martin Rosenqvist about the trends he is seeing in Scandinavian companies. How are they allocating resources when it comes to technology investments, how are they optimising? What are his tips for making the best out of your technology budget?

1.Given the threat of an economic downturn, how are the companies that you are working with changing their digitalization strategies??

So far the changes have been related to speed, as a consequence of a more carefully balanced rate of investment. Instead of executing two needed initiatives in parallel, it’s one at a time, or maybe with a smaller force.

"It’s not a discussion about if digitalization is needed, or not, because it is, instead, it’s about the timing of execution."

2. Gartner recently reported that enterprise IT spendings will remain strong into 2023 . Is that true? How are IT budgets being handled in Sweden? Are they reflecting that the IT business is now part of the core business and not just a back office?

There is a great spread depending on the industry. If we look specifically into traditional industries, an economic downturn will make a clear distinction between those that consider IT as a back office and those that consider IT as part of the core business.

"An economic downturn, combined with an outdated view of the role of IT, can become a golden opportunity for progressive players to accelerate and take a leading position. If they have the courage, know-how, and funds."

3. What can companies do if their budgets are cut, but they need to finish what they had started?

Prioritize, focus, and execute. Iteratively. If the budget is cut, adapt to the new circumstances. Prioritize your initiatives. Focus on the top priorities and make sure to deliver them. Evaluate and iterate. I know it’s not rocket science, but it has served me well so far.

4. What should companies be focusing on right now? Innovating or optimizing? Where do you think digitalization can have the most impact??

It will of course depend on the company, its situation, and on the market in which it operates. Personally, I believe that most companies will benefit the most from investing in value creation over over-focusing on efficiency. And change over preservation. Especially as the speed of innovation just continues to increase. Exploit what is already there, but make sure that you explore for tomorrow. It will come sooner than you think. I still meet many companies who are not investing sufficiently in tomorrow's business.

5. Is this downturn also an opportunity to get ahead??

Yes, I believe it can be. For those companies who have the courage, know-how, and funds. While their competitors are hesitant to make the move, those who know that IT is the business, already today, will have a great opportunity to get or extend a transient competitive advantage. Transient, because with today’s speed of innovation, it will become a commodity. It’s just a question about when. This perspective is very important when it comes to a company's tech strategy, more specifically, what tech products they should build and how. If the time window to capitalize on an investment is small, it affects several technical choices. Things are different today than yesterday: not the least with regards to the services of the 3 big public cloud providers, and the rise of low-code/no-code platforms.?

6. You are emphasizing the need for innovation repeatedly. How did tretton37 historically help companies that "got stuck"?

My personal favorites are all those times when we have helped our clients accelerate their digital evolution by exploring new business concepts together with them. Defining the underlying problem or opportunity. Doing the research. Collecting inspiration. Generating ideas. Prototyping them. Testing. Iterating. Discarding. Building. Mashing up. Evolving. Then when the fit is there, scaling up. A key thing here is that we do it together with our clients - side by side. That’s where the magic happens. When you bring together a cross-functional and interdisciplinary team of subject matter experts and tech product professionals, such as engineers, designers, and business people. Provide them with a challenge and enable them to move fast.

The very best and most memorable are those engagements where we have helped our clients with complete change management. We helped them build a tech product and at the same time also helped them build the capability itself - a team or an organisation - so that they could become an independent digital first organization.

7. Does hiring a technology consultancy make more sense now than ever before? Why?

There are many reasons for hiring a technology consultancy. One is that a consultancy brings up-to-date expertise to the table. Expertise in how to solve problems using the latest technologies and methodologies that are deemed right for the job. Based on extensive knowledge and experience. So that you build the right thing, in the right way. Efficient and with a shorter time to market.

And since technology really is running the world, more and more companies realize that they actually need an in-house tech organization so that they can continuously stay relevant and be in charge of creating their own competitive advantage. A tech consultancy can help you build your very own in-house tech organisation too. ?

And of course hiring a tech consultancy for a temporary engagement can be a cost-effective approach compared to employing that competence.

8. How can companies ensure they get the best outcome for their investment if they hire a consultancy company??

In my book the top 3 things are:

1. Make sure to get everyone on the same page - build a joint understanding on what you are trying to achieve, why that is so, rules of engagement, communications and more.?
2. Embed the consultants in the organisation, preferably with the business, and provide them with access to your co-workers, customers, partners and data.??
3. Plan from the end forward so that you are ready to nurture the value that you have invested in creating as the consultancy disembarks.

Doing all of the above is necessary for ensuring that the focus is on the things that matter the most - the things that create the most value, done with the shortest possible time to market and in a cost-effective manner.

9. What are some trends that we will see happening in the future due to the current circumstances??

1. The economic downturn will accelerate the adoption of low-code/no-code platforms and AI assisted software development such as GitHub Copilot in an effort to get more things done with less resources. And also, because it’s pretty cool.
2. Faster and unforeseen changes in the market will require increased business agility and this can be achieved by integrating cross-functional tech teams into the business, not isolated within the IT department. IT is the business.
3. If funding gets more scarce then proportionally the importance of proper discovery work - i.e. uncovering and validating what to do from a business, customer and technology perspective (viability, desirability and feasibility) - will increase.

10. Anything you want to add??

A friendly advice, to discover and deliver awesome tech products and services software engineers are necessary. They are valuable players in any company’s team roster going forward. However they alone are not sufficient.

"'To ensure success, make sure that you have a fit-for-purpose cross-functional team with business, data and design competence as well before adding more great software engineers. They truly need each other to create masterpieces."

Connect to Martin through LinkedIn.

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?? About Martin Rosenqvist

Martin helps organizations achieve their business needs through the use of technology. He is skilled at knowing what your business needs to reach its objectives and he thrives at guiding leaders and supporting them along their digitalization journey.

Throughout the years, he has led, managed, and coached hundreds of people. Worked on more than a hundred assignments with close to 80 different companies. Ranging from start-ups to large multinational businesses, across a dozen of industries, in 20 different countries on three continents, from America in the West to Asia in the East.

?? Some of the clients he has helped include: Rillion, Sortera Group, Oleter Group, SilverRail, MobiMeo, IKEA, Alfa Laval, Tetra Pak, E.ON and others.

He is happy to connect on LinkedIn or in person.