Whether it’s artificial intelligence, big data, or blockchain, it’s hard to scan through your newsfeed without running into one of today’s tech buzzwords. Firms want to leverage this cutting-edge technology to drive value, but the cost of managing and maintaining technology spending is one of the most challenging aspects of such an endeavor.
Nicsa members gained insight on strategies crucial to long-term tech budgeting during Nicsa’s 2019 General Membership Meeting in Boston. The panel, moderated by Kelley Conway, Managing Director at Accenture, also featured leaders from Akoya, J.P. Morgan, and Putnam.
Conway said a recent Accenture study of more than 8,300 organizations across 20 industries revealed that those that excel at scaling technical innovation generate twice the revenue growth of those that simply adopt new technology.
“Laggards adopt, leaders scale, she said. “Leaders look to the future. The cloud? They don’t think about it as cost — they think about the analytics, the AI tools, and everything that it’s bringing to the table. It’s not just about tech spend, it’s also about the business impact.”
STRATEGIES FOR LONG-TERM SUCCESS
Wilson D'Souza, Chief Technology Officer at Akoya, LLC, said the cost pressures on tech spend used to be heavy, but those days are largely over for most companies.
“Increasingly, C-level executives and leaders recognize that technology is the backbone of the businesses of the future, whether you use it to drive optimized capabilities in your enterprise or deliver new value to customers,” he said. “They are also thinking about how they can scale out faster.”
Gail Knudsen, Executive Director, Product Development Team at J.P. Morgan, said it’s essential to focus on areas where you can add value as an organization.
“You have to spend for the future from a strategic perspective, you have to spend on cyber security, and you have to spend on products that will bring immediate value to the business — and most importantly — your clients,” she said. “That is critical.”
Michael Woodall, Chief of Operations at Putnam, said it’s important to consider the biggest “bang for your buck” when it comes to investment professionals and lowing the cost of acquisition as it relates to distribution.
“We can accept that there is a certain level of efficiency already built into the operating model, so where is it that we can make a difference internally by investing money?” he said. “I consider AI the further evolution of advanced automation — that’s where you see the marrying of business professionals and technologists around the ability to write code at a very local level.”
GAUGING & MAINTAINING SUCCESS
D'Souza told the audience it’s important to approach any new technology with an investor mindset. “When you think about your technology assets, apply the same nomenclature and philosophy that you do in the marketplace, around what you want to sell, what you want to hold on to, and what you want to make big bets on,” he said.
Knudsen said ROI is any easily measurable performance indicator, but it’s also a good idea to consider the intrinsic and strategic value inherent in new technology.
“It’s partnering with the client and making sure they’re able to grow their business — that’s our job,” she said. “It’s also laying the foundation for the future growth of your organization and investing in that. Finally, it’s spending money on protecting the reputations of the firm, staff, and clients.”
When it comes to hiring talent, Woodall said firms should have strategic relationships with colleges to get technical experts into the job stream, as well as develop talent internally.
“This big squeeze is on to bring costs down, so you’re forced into agility,” he said. “At the end of the day, the tech game is about talent. You have to line up the right people.”
Note: Although the observations contained in this work represent the best thoughts of the individuals comprising the NICSA panel, they do not necessarily reflect the views of NICSA or any of its member organizations. Matters addressed in this work may touch upon legal or regulatory matters, however nothing herein is intended to be or should be construed as legal advice. You should contact your own counsel in order to obtain legal advice regarding these or any other matters.
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