The economy has entered tumultuous waters, with inflation at an all-time high. This is combined with a challenging labor market and low unemployment, stock market fluctuations, and global conflict.
Tech leaders may be under the illusion that these aspects of the global economy don’t affect them, but inflation can impact operational and strategic activities in the tech sphere. Here are 3 tips that can help you manage and mitigate the repercussions of inflation.
Manage Your Assets
Tech organizations often handle a large number of expensive assets. This includes employee technology such as laptops and smartphones, as well as, expansive data centers and server infrastructure.
With the rise in inflation, the price of acquiring new assets and gathering parts and replacements for existing assets will increase. Inflation will also impact the cost of financing these assets.
The stock markets are a precursor of what’s to come, it will take weeks or even months for inflation to make its presence felt.
Meanwhile, tech leaders can use this time gap between rising inflation and its impact on prices to their advantage. Accelerating significant asset acquisitions, locking in current pricing, or moving expensive assets off the books through techniques like cloud adoption are some of the ways to preserve financial resources. Similarly, examining whether the lifespans of existing assets can be extended can help mitigate the effects of rapid inflation.
Control Your People Costs
Wage inflation, combined with a tight labor market, is one of the reasons for the sudden and rapid rise in inflation and can prove to be a significant challenge for tech leaders.
To handle this, you can consider adding non-salary benefits or benefits with high perceived value and lower costs than additional salary. Similarly, emerging benefits like wellness weeks or additional holidays can also help save your company the big bucks.
Be On the Lookout
Remember, you’re not the only leader in your organization struggling to respond to turbulent and uncertain times. However, you have the advantage of being a leader who deals in data and information. Thereby putting you in a beneficial position to help your peers, monitor leadership, and get a bird’s eye view of the changing environment.
Take the time to review your tech portfolio and focus on current and in-flight investments in reporting, analytics, and data management. Redouble efforts to become your organization’s key source in providing early alerts and insights on key metrics to help other leaders make informed decisions.
Uncertain times are always challenging, particularly when you’re leading a team or providing critical insights to colleagues. No one knows how the current economic situation will play out. But, acknowledging the challenges and using your unique positioning as a tech leader to meet them will make you a better leader and help your team and organization weather the storm.