business innovation
Europe Fintech Insights

Innovation Put on the Back Burner as Appian Finds Organisations Are Cutting Costs

Covid sparked a growth of innovative ideas, but with the current state of the economy, many of these ideas have now been put on the back burner. In fact, 79 per cent of UK developers have said their organisations are now focusing on cost cutting initiatives. According to a study from Appian, IT leaders’ impact for driving business agility at the decision-making table is already at risk.  

The new study from the cloud computing organisation, Appian, From Boom to Bust: Why Empowering Developers is Vital for Business Innovation, surveyed 1,500 developers and software engineers across Europe (France, Italy, Germany, Netherlands, Spain, and the UK).

It found three quarters (75 per cent) of respondents in the UK are concerned that the transition from the pandemic to downturn will see business leaders freeze IT budgets and headcounts, increasing IT backlogs, and slowing enterprise digitisation and modernisation efforts.

This is in stark contrast to the progress made when the pandemic required fast action and new approaches to business innovation. More than four-fifths (85 per cent) of respondents in the UK say the past two years have sharply accelerated their company’s focus on IT-driven business transformation. Meanwhile, three-quarters (74 per cent) say they now have a full seat at the table as a business decision-making partner. But firms that fail to leverage developers’ increased influence are at risk of seeing diminishing returns.

What freezing the budgets means

When asked about the consequences of freezing IT budgets and headcount, the top four fall-outs mentioned by UK developers were: their organisation would become increasingly fragmented and siloed (44 per cent); new platforms would take longer to integrate, reducing ROI (43 per cent); the company would be more likely to struggle when attempting to capitalise on new growth opportunities (40 per cent); and IT staff turnover would increase (40 per cent).

The research also aimed to understand how European software developers and engineers feel about their organisations’ ability to innovate in this market, and the impact they’re able to have on business decision-making in the face of uncertainty.

Respondents in the UK identified adapting business strategy due to economic changes (44 per cent), maintaining focus on core mission (36 per cent), as well as harnessing new technologies and platforms (36 per cent) as the top three critical growth drivers in the face of harsh economic conditions. When it comes to technology-led business decisions, insights show developers feel strongly about the need for improved collaboration and mutual understanding.

A third (36 per cent) of UK developers say too many silos throughout the organisation prevent a full understanding of how to use IT. An additional four in 10 (38 per cent) say business counterparts believe it is quicker to go directly to IT vendors for solutions, rather than engage IT teams within the business.

Doing more with less

To overcome these challenges, eight in 10 (80 per cent) developers in the UK say the workforce of tomorrow must include more business-savvy IT professionals and more IT-savvy business professionals, if organisations want to be able to successfully manage and grow through change.

IT leaders also believe technology can help businesses to become more efficient at a time when they are looking to do more with less. Nearly half of respondents believe technologies like low-code development and artificial intelligence/machine learning address the resource and business engagement challenges facing IT (47 per cent and 46 per cent, respectively). This will enable organisations to adapt to change and get work done faster.

“Covid forced businesses to rapidly innovate their processes, increase automation, and absorb new technologies,” said Michael Beckley, founder, CTO, and CMO at Appian. “Organisations that continue to invest in IT-led innovation and agility will be better prepared to navigate the tight economic conditions expected in 2023.”

Author

  • Francis is a journalist and our lead LatAm correspondent, with a BA in Classical Civilization, he has a specialist interest in North and South America.

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