A Crisis of ServiceNow Opportunity

In times of economic turmoil, it may be tempting for company leaders to put off transformative plans and focus on cutting costs instead. Even so, these are not alternatives for a longstanding solution because the economic reality is more complex than that. Instead, we face challenging macroeconomic factors that have led to decision-making based on fast and effective processes among leadership teams. As a result, our encounters with high inflation and increased unemployment have created a stagflation effect propelling us to strike a careful balance between cost optimization and business acceleration. 

This current economic state is already affecting tech leaders, and many are trying to determine where they can cut spending. The debate on whether we are in a recession or if we are heading to one is still robust. Therefore, some leaders believe that a shrinking economy will ultimately impact tech leaders' budgets and focus, so the key question is: Should we bet on cutting spending? I do not believe the answer should be a determinant "yes" , but the cost could be significantly reduced by adopting new technologies. Accordingly, digital transformation initiatives are commonly substantial line items in tech leaders' budgets and should be examined as financial circumstances evolve.

Is digital transformation a worthwhile investment?

Generally, digital transformation initiatives can be broken down into three categories: Cost reduction through new technologies (e.g., cloud migrations or automation), enhancements of current products or services through digital technologies (e.g., an app that pairs with a physical product), and creating operational flexibility (e.g., remote/hybrid working tools).

Investing in digital transformation means creating a new vision for your company's future. According to Gartner, it has been determined that "69% of boards of directors accelerated their digital business initiatives following COVID-19 disruption." In that event, during periods of stagflation, investing in tech is a smart way to accelerate and sustain your business growth, achieving your company's long-term goals by focusing on sustainable development and striking a balance between cost optimization and business acceleration.

As a financial director, I have found a substantial value in performing actions that enable short-term cost optimization and long-term growth acceleration. I recommend taking a balanced approach through the following:

1. Developing credible scenarios for the next 3-5 years.
2. Analyzing the impact of those scenarios on operational strategy.
3. Assessing the need for investments in new capabilities, processes, and technologies.

But how can companies achieve that so-desired balance during challenging economic times? Whenever there is a crisis, it always creates new opportunities. Disruptive events, such as COVID-19 or the current unstable economic conditions, are prime examples of this. Since joining Volteo Digital, I have seen firsthand how the nearshore paradigm has risen in the tech industry, allowing business corporations to tighten their budgets while looking for options offshore.

Nearshore: an Scalable Solution

The nearshore paradigm has become a transformation enabler for US companies; partnering with nearshore companies provides flexibility and adaptability for organizations looking to optimize cost, as it allows them to access extremely skilled talent within the same time zone and with similar cultural background for a fraction of the cost, to meet temporary demands and being truthful to the cost-saving mindset that stagflation inevitably forces. 

In addition, nearshore is shaping the companies in the technology industry by reducing IT Service management complexity. For this reason, in the ServiceNow ecosystem, different nearshore strategies have been brought to attention as scalable solutions to face corporative business instability: 

• Consolidating the new and legacy applications portfolio into a single work team.
  
• Accelerating new technology deployments while ensuring their effectiveness and optimization.
  
• Guaranteeing predictable behavior and uninterrupted operation of critical applications.
• Reducing stakeholders' diversity and leveraging the strengths of a robust and flexible business partner with a global reach.
  
• Saving on service by reducing overhead and taking advantage of locations with lower costs.