Assessing the impact of COVID-19 on the technology industry will help companies implement sustainable recovery programmes that will thrive in the years ahead.
The coronavirus pandemic has had far-reaching consequences across every industry sector, and it will continue to do so throughout 2021. That said, different industries have been affected in different ways. Many technology companies have thrived, for example, while businesses in the hospitality and aviation sectors have suffered immensely.
One of the most pervasive trends we have seen over the past year is how the pandemic has catalysed rapid and unprecedented digital transformation across almost every industry. There is now greater attention being paid to technology than ever before, as companies look towards facilitating remote work and economic recovery over the longer term.
While there is finally real hope on the horizon for a return to normality and recovery, challenges remain. The technology skills gap continues to widen, and organizations in many sectors have to make do with limited budgets as they plan their recoveries in a post-pandemic world. Now, more than ever, they need to be careful how their money is spent and do everything they can to avoid wasting what limited resources they have left. This begins at the development stage, as new software stacks are created and old ones are updated.
Technology solutions are themselves critical for making that happen, especially in the case of productivity and analytics solutions like BlueOptima, Semmle, and PluralSight Flow.
What does the future of the technology sector look like?
The developed world now faces a recession of the likes not seen since the Second World War, and this will have an affect on every industry. But, as is the case with every recession, there will both be winners and losers. Among the obvious winners are the biggest tech companies, such as Amazon and Microsoft, owing to the fact that they are key enablers of remote work and cloud computing for hundreds of thousands of businesses around the world.
Given how much every sector relies on digital technology to a greater or lesser degree, it can be difficult to determine what future expenditures in the sector may look like. Forrester expects tech spending to fall by around 5% in 2021 as the economy starts to recover around the middle of the year. On the other hand, a much more recent study by Gartner paints a more optimistic picture, with worldwide IT spending expected to grow by 6.2% this year. Considering the fact that vaccines were already being rolled out across many of the world’s biggest economies by the time the latter study was published, this is perhaps the more likely scenario.
Digital transformation is the holy grail of business resilience
Uncertainty continues, not only regarding the path of the pandemic, but also the economic and societal consequences, both of which will continue to manifest over many years. For a large number of businesses, the pandemic has been a brutal wake-up call raising attention to the ever-increasing need for greater resilience. With uncertain times ahead, they must adapt and future-proof themselves. This is especially true of those in badly-hit sectors like aviation and tourism, which risk becoming un-investable industries, should they fail to modernise.
To ensure stability in this uncertain future, businesses must reallocate their resources into the solutions and processes that promote greater efficiency, productivity, and stability. The digital world has proven something of a panacea in such causes, since it empowers more flexible work environments, simplified disaster recovery, and reduced costs through the automaton of routine tasks.
The pandemic has also led to societal changes, some of which will persist long after the crisis is over. For example, while many people are enthusiastic to get back to the high street to shop as soon as possible, the rapid adoption of digital commerce channels over the past year will continue to pay off. After all, people like to have options, and the more the better. Similarly, business leaders might be looking forward to getting back to in-person events like trade fairs and conferences but, in the age of global business, virtual and hybrid events will not become any less relevant in the longer term than they are today.
Remote work is also here to stay, especially given the skills shortages in the technology space. No longer do organizations have to restrict themselves to specific geographical locations. For example, most jobs in the software development space can easily be carried out remotely with the right tools and processes in place. Moreover, no matter what the future holds, this is not likely to change.
Skills shortages will persist, but automation and insight can help
While there is no doubting the value of digital transformation, the prospect of reduced budgets presents a challenge that is greatly accentuated by the growing need for new technologies. In other words, business leaders realise they need to work towards greater digital resilience, but they often have limited resources for making that happen.
This is where the need for heightened efficiency and flexibility comes in. Organisations must be able to continue working with remote teams to overcome localised skills gaps and adopt more flexible business models. At the same time, they must have oversight of these distributed working environments to ensure faster software delivery and greater transparency in a time when they are under increasing pressure to bounce back after the pandemic. Thus, all routine tasks must be automated, and business leaders must maintain oversight of their teams with a steady stream of data-driven insights delivered in real time. After all, no digital transformation strategy should come at the cost of poorly implemented and maintained code bases and lack of security and functionality.
Final thoughts
Organisations in the technology space, such as SaaS providers, software development firms, and cybersecurity solutions providers, will no doubt face an enormous increase in demand in the coming years as companies turn to them for assistance in their own digital transformations. Similarly, large enterprises that develop and maintain their own technology solutions will also face heightened pressure, albeit with the prospect of reduced budgets.
As the skills gaps start to narrow and business leaders turn more towards data-driven analytics and forecasting, there should be further opportunities to prevent unnecessary spending. With the tools available to help optimise spend and boost productivity, all those in the technology space now have an opportunity to flourish this decade.
