Moving Forward In The Time Of The Coronavirus: How The IT Industry Is Surviving
With no end in sight for the Covid-19 pandemic, countries around the world are struggling to bring their economies back on track. Apart from the loss of life, the pandemic has also set in motion changes in the technology sector, which will have profound implications after the crisis has died down.
Hence, the need of the hour for tech executives around the globe is to turn this massive challenge into meaningful changes and outmaneuver uncertainty caused by the pandemic.
Trends Brought About By The Coronavirus Pandemic
2019 was a great year for the tech industry, but 2020’s Covid-19 situation has affected the sector adversely, plunging Q1 2020 year-on-year deal values by 26%, according to the reputed financial institution, Barclays.
Consumer behavior is changing, and the IT industry is adapting to it. Owing to widespread lockdowns across the globe, companies offering tech solutions to the travel, transit and co-working industries are struggling and having their business models updated.
Consumer behavior changes have ensured that several internet-based activities are benefiting massively. Companies offering better connectivity, security and data compression are seeing their usage volumes increase due to the fact that more professionals are working from home.
Service-focused technology companies based on e-commerce, online streaming and online collaboration tools are also seeing an uptick in usage.
In the near-term, there will also be an explosion in the usage and development of innovative products in emerging technologies, such as telemedicine, remote security and next-generation video communication and streaming.
Besides, cloud-based collaboration platforms have been vastly successful, with Microsoft Teams securing a record-breaking 2.7 billion meeting minutes in March 2020.
What Are The Issues They Are Likely To Face Going Forward?
According to the Global Business Travel Association, a trade group for corporate travel managers, 98% of companies have suspended/canceled their international business travel, while 92% have admitted to canceling/suspending domestic business travel during the current situation. This trend has led to a huge reduction in client interactions.
With most people working remotely, a rise in cybersecurity breaches is likely. This will emerge as a key issue that tech companies will have to deal with. Enhancing cloud security would also be mission-critical for all firms. Owing to the rise in the use of cloud computing, the mettle of IT executives will be revealed based on their skills in securing cloud.
Business development opportunities for tech firms are set to decline due to the rise in the number of industry event cancellations. Notably, firms that do not possess the infrastructure to conduct virtual events have been the most affected.
One of the most crucial issues for the IT industry, however, will be that even the most well-laid business continuity plans will not suffice for dealing with a pandemic of this proportion.
How To Energize Your Growth Trajectory
Considering the situation, tech companies should focus on these five pointers to seize revenue opportunities:
1. Remote Working
The current work from home setup is proving to increase productivity by a large margin. As tech companies have always found it hard to find and retain talent, the rise of remote working has given them access to a large talent pool that they can keep by providing working options according to their preferences. However, this has also brought to the forefront the dual challenges of adapting to remote workflows and making the recruits feel part of the team.
2. Developing Strong Balance Sheets
Doing this will enable tech companies to thrive in the post-pandemic market environment. While many companies are struggling to operate in a remote environment as a result of their out-of-date finance and accounting processes, a handful of financially secure firms are ramping up acquisitions. IT sector firms, hence, need to emphasize on the automation of their crucial finance and accounting processes.
3. Building Financial Agility
This step necessitates the appointment of an accountable leader who is supported by a cross-functional team to efficiently manage this continually evolving crisis. It is worth noting that the leader needs to have a coherent strategy for proper data analysis and seamless decision-making.
4. Running Simulations
Another step that is also quite crucial and will contribute vastly to your firm’s success is running simulations based on realistic scenarios for the short-, medium and long-term.
5. Enhanced Security
Additionally, the IT industry needs to double down on security. Proper means of ensuring efficient identity management and access control in the cloud and following prescribed cloud security best practices will go a long way in protecting the company’s data.
Even during the global financial crisis of 2008, the IT sector managed some growth due to rapid economic recovery. However, the present slowdown brought about by the Covid-19 pandemic is different as experts aren’t sure when things will get back to normal.
The situation might be dire, but there are also plenty of opportunities available for the IT industry. At the end of the day, it is not just about a missed opportunity, but failure to rise to the challenge may jeopardize decades of hard work and growth in the IT sector.
Originally published with Forbes