Companies are always looking for ways to cut costs, and tech-related expenses aren’t immune to being trimmed. But in today’s tech-first world, some investments are simply too important to be placed on the chopping block.
The members of Forbes Technology Council know and understand the tech equipment and functions that no company can afford to do without these days. Below, 15 of them discuss tech-related expenses that companies are often too quick to cut and why it’s so important to maintain these investments.
1. In-House, Custom Platforms
Most companies’ in-house, custom tech platforms are a unique value proposition. However, they can be costly to develop and maintain. As a result, many companies go with generic external solutions to save money. Each company that does this becomes just another player in the market without any significant differentiators. – Aji Abraham, Armia Systems Inc.
2. Talent Development
The largest percentage of tech-related expenses is labor. While it’s tempting (and easy) to cut training and talent development costs in a down market, without proper reskilling budgets, companies cannot remain competitive. There also needs to be a budget for unlearning, because old ways of thinking can work against the ability to comprehend the need for change. – Siby Vadakekkara, Marlabs LLC
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3. Quality Assurance
In a recession, companies look to cut costs. One thing to avoid cutting is QA. For example, recall that in 2017, the New York Times laid off many of its copy editors. In 2019, the Twitter account, “Typos of the New York Times,” was created. Today, it has nearly 97,000 tweets. In tech, a typo equals a bug, which will lead to complications—such as security vulnerabilities. In short, investment in QA is essential. – Nicholas Domnisch, EES Health
4. Training On New Tech
Shockingly, I’ve witnessed tremendous resources put into the deployment and support of new technologies, but not always into a critical success factor: adoption. One of the barriers to success for new tech is a lack of user adoption. Unfortunately, many leaders sacrifice employee training, believing that the benefits of the tech will drive adoption and forgetting that education is what leads to adoption. – Vinod Paul, Align Communications Inc.
5. Multilayered Data Security
The prevention of data breaches requires a multilayer approach. Many companies do not invest enough into all layers of security, leading to gaps that manifest in a larger expense when there is a security incident. Whether in bearish times or growth periods, planning for consistent spending to avoid major security incidents is essential. – Supreeth Rao, Theom, Inc.
6. Customer Experience
As companies face more uncertainty, they are looking closely at how customer experience teams impact the bottom line. Too often, CX is thought of as a cost center, but recent data shows that high-performance companies are eight times more likely to view CX as a revenue center. By empowering agents and enriching experiences, companies can provide personalized service and retain loyal customers. – Adrian McDermott, Zendesk
7. Continuing Education
Budget dollars allocated for training items—such as sponsoring or attending tech symposiums, obtaining tech certifications, and leveraging learning programs—are often first in the recall line during tough times. If we consider tech as a knowledge industry, one can’t survive for long after axing the knowledge tree. Instead, companies should invest in curating business- and domain-oriented tech programs and establish a way to verify the ROI. – Pramod Konandur Prabhakar, Pelatro PLC
8. Cybersecurity
Companies often cut cybersecurity expenses, but cybersecurity is a crucial investment. Cyberattacks can result in costly data breaches and damage to a company’s reputation. Staying ahead of potential threats can save a company from devastating losses in the long run. Also, cybersecurity protects companies not only from external attacks, but also from internal ones, such as data breaches or internal hackers. – David Bitton, DoorLoop
9. Research And Development
During challenging times, companies often start by cutting training or research and development costs. These long-term investments are key to the survival of any company and should not be put on the back burner. Wise investment today can result in a profitable future. Without R&D, the innovation process is limited; without proper employee training, quality is impacted, which can result in churn. – Hassan Abbas, Ericsson
10. Cloud Storage Space
Cloud services or extra storage for employees is often overlooked or quickly cut. Investing in cloud services and extra storage space is an essential investment for businesses, particularly during times of remote working. Not only does it come with a reasonable price tag and easy scalability, but it ultimately helps to keep the workflow running smoothly in any situation. – Matt Pierce, Immediate
11. Upgrades And Patches
Companies often defer or cut upgrades and patches for systems; however, not upgrading can leave you with technical debt, creating high costs later—such as required major releases, expired support agreements and/or security vulnerabilities. Just as performing automobile maintenance regularly will make a car last longer and run better, it’s important to keep up with upgrades and patches. – Sean Barker, cloudEQ
12. Experienced Leadership
Many startups do not hire experienced heads of teams and departments because of the higher wages associated with this kind of expertise. Instead, they over-rely on junior, inexperienced staff. While I firmly believe in giving everyone a chance to show their full potential, sometimes you just need to hire an experienced expert to lead the department and bring out the best in everyone. – Peter Abualzolof, Mashvisor
13. SEO Tools
I’ve seen a shocking number of companies cancel their on-site SEO tools. You need to keep this software around if you want to boost organic traffic and engagement. Most SEO tools allow you to check for readability, add schema markup to your site and optimize posts for specific words and phrases. These factors can significantly impact brand visibility and your long-term success. – Thomas Griffin, OptinMonster
14. Asset Management
Asset management is an often-overlooked process and expense within a technology department, yet it is one of the few processes that more than covers its costs. Managed proactively and consciously, a hardware and software asset management system will save significant costs for a business and ensure that other supporting activities, such as privacy and cybersecurity, are managed effectively. – Mark Brown, British Standards Institution (BSI)
15. Hardware For Remote Workers
Many companies don’t spend enough on hardware to be used for remote work. There are still some bring-your-own-device policies in startups and midsized companies that ask for contractors or remote employees to use their hardware. This can be a problem if a computer breaks down or there’s a software-related issue. Since this is not your computer, you can’t just send it to the IT help desk or rely on the warranty, and you lose time and money. – Sergio Tang, Vivela
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