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New normal of remote working sees more than half of innovation budgets cut
Nearly one-fifth of tech executives have seen signiﬁcant reductions in their innovation budgets because of the Covid-19 pandemic, says report
Companies have responded to the coronavirus by prioritising support for huge numbers of distributed workers, but research has shown that as this has happened, there has been a cut in innovation investment.
The Innovating in a Post-Pandemic World report study from Pulse, examined how global leaders have been forced to reprioritise during the Covid-19 pandemic, with many pushing innovation to the backburner as they tried to adapt to a new reality. The research follows a Pulse report on behalf of Hitachi ID Systems which found that CIOs have had to battle hard to maintain acceptable experiences for the hugely increased number of remote workers their companies have had to deal with.
The May 2020 survey involved 100 North American C-suite executives at enterprise, mid-sized and small companies, looking at the biggest roadblocks IT teams have encountered while working from home. It found that 95% of all CIO respondents reported that their IT organisations had been bogged down by inefficiencies since the pandemic accelerated a shift to remote working.
And as companies start to look towards a post-pandemic world, it seems they won’t be investing in innovation any time soon to deal with these issues as spending allocation is reined back.
The latest survey collected data from 154 IT, engineering, product and security leaders between 4 and 18 June 2020 to ﬁnd out how innovation budgets have changed since March, whether they will rebound, where and how leaders are focusing their innovation investments, and whether leaders are willing to work with startups as part of their innovation agenda.
Even though the research found that innovation was a priority for 90% of executive teams, with most companies focusing their investments on internal initiatives, Pulse found that global leaders had been forced to reprioritise during the pandemic. Many pushed innovation to the backburner as they tried to adapt to the new reality of mass remote working, which looks like it won’t be ending any time soon.
The internal departments most focused on innovation through the rest of 2020 are IT and product. Most teams are aiming for cost savings and business growth with their innovation efforts. Covid-19-related goals such as adapting to the remote working economy and optimising operations following headcount reductions were also popular motivators.
Just over one-third (36%) of IT leaders said they were currently collaborating with startups, but don’t plan to in the future. The 64% of teams that are working, or plan to work, with startups were most frequently partnering with those past their Series A ﬁnancing round, and who are focused on technology.
Of those that are willing to work with startups, the most common types of partnership are collaboration on growth initiatives and the purchase of the startup’s products or services.
Read more about new working
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