Super-Deduction - How IT Project Management can deliver investment led business recovery
It’s Easter Monday as I write. After some warm sunny days last week, today I woke to snow! Now, as an icy wind batters against the window, the sun is so bright, I have just had to close the curtains so that I can see my screen! Mad weather but this gives me cause for optimism.
The weather today feels like a metaphor for life right now – unpredictable, blowing warm one minute and then cold the next but plenty to feel optimistic about.
Even the economy!
Investment Led, IT Project Delivered Business Recovery
Following the latest UK Budget, from April 2021, a new “super-deduction” will cut companies’ tax bill by 25p for every pound they invest in new equipment. This is predicted to be “worth around ￡25 billion to UK companies over the two-year period the super-deduction will be in full effect”.
It may have a pretty lame name, but the “super-deduction” may have an impact for IT Projects that is anything but!
“Super-deduction” is actually a canny bit of very basic economics! Without the super-deduction, an investment made by a company today would actually cost more in real “cash tax” terms than one made in 2023. If your business realised an investment will cost more in real terms today, than it will in two years time, what would you do? Many would defer the investment - makes business sense. Hopefully, the super deduction will dissuade companies from delaying investment decisions until the 25% tax rate comes in and this, in turn, will ‘shock’ the economy back to life. An ‘Eat Out To Help Out’ for business investment!
Already we are hearing of existing qualifying main rate plant and machinery investments being removed from mothballs and plenty more being drawn up and greenlighted – all of which means related network implementation, software and hardware deployments. In other words, IT Project teams are seeing a much welcome increase in workload.
All well and good, if your team is geared up and ready! The thing is, our conversations with project teams since the budget suggest that not all are ready, not completely anyway, and there seem to be two main reasons.
Staff Shortages
The furlough scheme was great for maintaining staffing levels at the start of the pandemic, but as the first scheme ended and before the extension was announced, there was a period of uncertainty that inevitably led to some redundancies. As one CIO put it, “Before Covid we were ready for anything, we had resources deployed and plenty of capacity to expand and, where we had any shortfalls, we would hire resources in ‘as a Service’. We now feel less confident and more reliant on ‘aaS’ - as things pick up.”
Another told us, “There’s little appetite or confidence to hire from the board. We lost several team members to redundancy in the latter part of 2020. Those of us remaining have kept the lights on but the projects in the pipeline are going to need greater resourcing! And they’re projects that will be crucial to the post-Covid recovery. There’s no room for messing this up!”
New Skills Needed
It’s not just talent shortages that teams are reporting but different skill-sets and indeed mindsets that are needed.
“Pre-pandemic our portfolio was very proactive and forwards looking,” a CIO explained, “More recent projects have been more reactive to meet changing market demand, more agile in nature. We’ve managed okay, but with a reduced headcount, if things scale in this vein there are worrisome challenges ahead. Ironically, the firm’s ‘last in, first out’ approach to redundancies meant we lost some colleagues who’d have been perfect for these projects.”
Another confided, “At DNA level, we’re just not an agile outfit. Historically, our projects have suited a methodical approach. Now, no one knows exactly what’s needed upfront and what’s possible with the technology available is more blurry. Our way of working doesn’t handle this too well. But what? Change everything knowing that when things level out we’ll be back to how things were? Make permanent changes that will impact long term because of short term need. That’s a tough call to make.”
Flexible Project Support
Stoneseed’s Project Management as a Service (PMaaS) model provides a solution to both these concerns, giving you access to project professionals, resources and tools in a flexible way and at a predictable cost. Flexibility and cost are crucial for navigating a period of investment-led recovery where return on that investment is more important than ever.
At Stoneseed, we’re hearing of project needs that can change from month to month, week to week, day to day or, as is the case with one client, even from one hour to the next! How can you expect to service this with existing, or often depleted, internal resources?
Stoneseed’s services portfolio offers a true end to end service, from IT Advisory, Business Analysis Services through to Programme & Project Delivery. PMaaS provides access to Flexible Resources on Demand, Project Management Office, Process and Methodology, Tool Sets and a straightforward Cost Model.
Remote Project Services
Stoneseed have always been recognised as experts in Remote Access Project Management, the pandemic and especially restrictions imposed upon the ways we all work has really brought expertise to the fore. Stoneseed can help support your IT Project Delivery in these uncertain times and cover staffing shortfalls.
Also, as that expertise is available on demand remotely, we can offer rapid response resources. You can align resources to specific need, on a cost-effective, full-time or part-time basis. We flex to support your project needs.
This next phase, the recovery from the business impact of Covid, is going to be pretty hard to predict - like this Bank Holiday weather! I started today wiping snow off my car windscreen, I’m ending it shielding my screen from the glare of the sun.
The biting wind has snapped our neighbour’s rotary washing line in half! To be fair, wind and sun seemed like perfect drying weather! I saw the forecast, saw how gusty it was going be and put ours safely in the garage – and that’s the best you can do, isn’t it? Assess the conditions, make adjustments, give yourself the capacity to act according to changing needs and most of all - stay optimistic.
The sun coming through the windows, even with curtains drawn, is warming my back.
I’m feeling optimistic.
Better days are ahead, let’s make sure we’re ready to make the most of them.
Find out about Stoneseed's Project Services