When it comes to investing in IT, who has the last word?

When the Covid-19 pandemic broke out in March 2020, most companies responded quickly and decisively. Forced to close their doors and engage in mass remote work, companies have found that pressure is mounting to accelerate their digital transformation initiatives as a significant share of IT budgets are mobilized for urgent and short-term projects. Business leaders unanimously understood that they must take on a great responsibility to ensure business continuity and protect their organization from physical and financial disruption. In many cases, long-term strategic investments have been suspended.

But for most companies, this initial momentum of cohesion at the top of the hierarchy was quickly replaced by a real struggle between the CEO, CFO and CIO. Because if the former seeks to put the company back on the path of growth, the latter, more cautious, seeks to save budget resources and limit investments that involve high capital expenditures. As for the CIO, he sees interesting long-term opportunities for technology spending.

And at a time when uncertainty prevails and so many companies are under a heavy burden, the CFO’s cautious approach has in most cases prevailed over what dominated the IT spending schedule. However, in early 2022 we see real changes in the course.

Arm wrestling over investment priorities

Despite some reservations about the emergence of new versions of Covid-19, the business world is developing a much more positive trend. Leadership teams strive to develop the flexibility of their IT infrastructure to be able to respond more quickly to emerging opportunities and stay ahead of the competition without being constrained by outdated systems. The pressure on management teams is now more focused on finding flexibility, both for the infrastructure on which the entire company is based and for the ability to use data to obtain strategic information and strengthen business intelligence. According to a survey by Insight Avenue, 83% of respondents say that such an approach is necessary to improve innovation and stimulate growth.

Today, the balance of power between the CEO and the CFO becomes much more nuanced: the growth prospects defended by the CEO now guide all discussions. They also better understand and respect the importance of the role played by the CIO. And for good reason: during the pandemic, the company could rely on his valuable knowledge to stay on track. CIOs themselves feel better prepared to advise other directors on technology investments that will drive the business as it matures and grows.

According to a recent ESG study called 2022 Technology Spending Intention Survey, IT investments are primarily driven by a desire to increase cybersecurity (38%), improve analytics to accelerate business intelligence and access real-time strategic customer information (33%), and improve the user experience (30%). These answers show how important it is to make the right choice when it comes to investing in IT. The wrong decision can have catastrophic consequences in the event of a ransomware attack, which will make it impossible to meet customer needs and get the most out of the company’s data. The study also shows the importance of improving the customer experience, which has direct implications for investments and projects that contribute to the company’s growth.

Invest in IT for growth

Firmly sustained to maintain their momentum, companies need a robust IT infrastructure that can grow rapidly. But from the point of view of business leaders, it is not so much the technology itself that matters as what it can produce.

Good investments in technology are those that promote business development. Business and IT managers demand that their IT infrastructure deliver better results, faster and with maximum transparency. They don’t want to worry about the infrastructure or hardware needed to do so; they are simply striving to achieve a goal that will guide the business on the path of growth.

At the same time, the choice to invest in subscription models and models as a service helps to meet the need for financial stability expressed by CFOs. These models help them better forecast their costs, as they are based on installment payments and therefore avoid large upfront costs.

Nurture the spirit of “invest to grow”.

Infrastructure can interfere with the vision of management teams. To achieve flexibility, customer focus and innovation, which companies are said to value, IT managers need state-of-the-art cloud-based technology that they can use flexibly, adding or removing solutions to suit their needs. This approach gives them the freedom to free up more time and resources to invest in development.

2022 will be marked by a strong desire to get out of the “survival mode” to plunge into a real renaissance. Companies will have to move away from the hesitations expressed by their CFOs and increasingly trust the strategic choices of their CIOs to support CEO growth plans. The old adage “You have to spend money to make money” is gaining its full meaning today.

Jug One, head of Pure Storage in France

The experts’ opinions are published under the full responsibility of their authors and do not involve L’Usine Nouvelle in any way.