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Hello, and welcome to this week’s newsletter.
A new survey of board directors just published by research group Gartner contained a surprising statistic.
It found that just over two-thirds of boards are expecting IT spending to rise this year, with increases averaging around 7%. This seems to fly in the face of other surveys, including one by Gartner, that have predicted a decrease in overall tech spending in 2020 of around the same magnitude.
The Gartner board study was conducted in May and June, so doesn’t reflect any optimism that might have reigned before the pandemic fully took hold. Nor does it suffer from a tiny sample size: The survey was based on responses from 265 directors from around the world, with almost half of them coming from the U.S. So it definitely seems like there’s some dissonance between what boards want and what CIOs and other executives are planning to deliver.
It’s possible that the survey was light on responses from directors in industries such as airlines and hotels that have been pummeled by the pandemic. But Irving Tyler, a research vice president at Gartner, thinks the spending issue really reflects the fact that the crisis has reinforced boards’ conviction that higher investment in digital-first capabilities is essential for both short-term resilience and long-term success. “Boards are very much looking ahead,” he says, “so things don’t completely reconcile yet.”
This week’s fourth and final episode of our 2020 virtual Forbes CIO Summit series provided some backing for that view. During the event on September 30, Daphne Jones, a former multiple-time CIO who is now a board director at companies such as AMN Healthcare and industrial and aerospace manufacturer Barnes Group, cited a study from consulting firm McKinsey that showed companies that innovate particularly well during crises end up strongly outperforming those that are more cautious.
“We’re not looking to put our heads in our hands and hope this [pandemic] is going to go away,” said Jones, referring to the companies on whose boards she sits. “We’re looking to dig in and drive innovation across all of the work that we’re doing.” And to deliver novel products, services and ways of operating including remote work, you need to step up investment in the technology that supports them—which may explain why a survey conducted by recruitment company Harvey Nash and consulting firm KPMG recently found that businesses worldwide have been spending the equivalent of around $15 billion more in total a week on IT since the crisis began.
Thanks for reading and do please send me your tips, thoughts, questions and ideas for future issues at mgiles@forbes.com. You can also follow me on Twitter and on LinkedIn. And if you enjoy reading this newsletter please recommend it to others who may find it useful.
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