When consumers curb IT spending, companies go without, too

When the economy looks this bleak, the technology nice-to-haves start to look like the just-don’t needs.

This is an attitude that would explain the precipitous drop in shares of Apple, the company’s biggest in seven years, which was directly attributed to the fears that consumers will be less inclined to buy iPhones or MacBook Airs when the major banks are declaring bankruptcy. Now that the U.S. House of Representatives defeated a US$700-billion bailout bill, those fears are likely to get a lot worse. But shareholders aren’t the only ones who should worry. There are dark implications for IT managers too.

One of the most consistent trends we’ve seen over the last three or four years has been the entrance of consumer technology into the enterprise. I’m not just talking about digital music recorders but laptops, smart phones and other technology that once would have been acquired and paid for by an employer. As mobile technology allowed more people to work remotely or at home, the more those workers opted to get their own equipment which they then expected companies to let in behind the firewall. The workforce, in other words, became a de facto purchasing department for a number of pieces of IT devices.

Although consumers tend to have a more frequent refresh cycle than corporations, there are many businesses that nonetheless have benefited from having workers who buy the latest and most powerful devices to access mission-critical data. If the credit crisis leads to a major downturn, those early adopters might fall behind. Depending on how long such a situation lasted, you could see some users’ laptops falling apart as they cling to older technology, or even some devices that aren’t interoperable with the latest standards and software. This is an extremist view, of course, but the point is that companies should not count on their users if they want to ensure their departmental IT is up to the tasks for which they will be used.

There’s no easy way to get around the difficulties such financial disasters portend, but learning more about the current state of consumer IT in the workplace might be a good way to assess the level of risk curtailed spending would impose on an organization. This might be as simple (or as challenging, depending on the size of the firm) of going through the roster and seeing how many employees use their own technology to do their jobs, and gauge how much those purchases actually cost.

The benefit here would also be useful from an IT asset management perspective – you would get a better idea of what you need by knowing what users already have – but it would amount to an IT department “shadow budget.” Unlike the real technology capital expenses, however, this is a figure around which IT managers, and their companies, have no control over. Of course, many companies have employee purchase programs for certain equipment, and perhaps the terms around these should be upgraded to provide more incentive. Hopefully as the stock market tumbles it won’t take a big chunk of IT spending along with it.

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Jim Love, Chief Content Officer, IT World Canada
Shane Schick
Shane Schick
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