“A slew of layoffs, rising interest rates, high inflation, and trouble in the banking system are all putting pressure on the economy. The U.S. and the rest of the world appear poised to head toward an economic downturn and recent analysis by Fortune said that a recession is now “inevitable .” Application and maintenance support can be a key factor in helping your company survive these troubling issues. Economic downturns often force companies to reduce their budgets, pause hiring, and shift long-term strategies to focus on the most profitable projects. Technology budgets often suffer some of the most severe cuts as companies try to do more with less. And even if budgets are not reduced, many companies implement hiring freezes, which reduce access to top talent and hamper application development initiatives. As many tech managers brace themselves for a potential recession, it’s important to examine how outsourcing application maintenance and support can help you cut costs, maintain access to highly skilled workers, and stay focused on high-priority projects
- Application and maintenance support helps tech teams cut costs, not corners
The cost of running internal application maintenance and support is significant, eating into roughly 43% of total IT spending, according to. Under normal economic conditions, finding a company that you can outsource this work to sounds like a nice-to-have option — but during a recession, it could become a necessity. Deloitte says that this year companies will increase their amount of outsourced application maintenance and support by 20 %. Why are companies making the switch to outsourcing? Because paying for a handful of specific services — instead for paying expensive salaries — can help technology managers save money. Indu Varatharaj, the Executive Vice President of PRI Solutions, says that companies can reduce costs and operate more efficiently when outsourcing. “You only pay for the services you need, whether it be for a few hours or ongoing maintenance,” she says.
- Outsourcing gives you access to highly-skilled talent
When the economy is booming, it’s not difficult to assess what your company needs and how you can hire the right person to get it done. But when budgets are tight, it’s a lot harder to fill costly tech positions that often require high salaries and generous benefits. Varatharaj says that hiring new staff “may not be feasible” during tough economic times and that outsourcing application maintenance and support can be a great way for companies to have access to the talent they need. “A diversified set of expertise can help a company to adjust to changing market conditions,” she said. This could be more important than ever, as a growing number of tech companies have reduced their workforces. Already in 2023, more than 130,000 jobs in the U.S. tech sector have been eliminated, according to. With technology teams already experiencing significant layoffs, CTOs and other technology decision-makers can continue to tap into highly-skilled workers by utilizing outside sources.
- Focus on profitable projects, not app maintenance
And finally, teaming up with a capable application support provider can unlock your in-house team’s ability to focus on profitable application development projects. This is especially important during a recession when companies need to become laser-focused on maximizing their internal development initiatives. A recent report from Deloitte said that reducing IT resources for application and maintenance support can increase emphasis on new application enhancements, “enabling new technologies that drive value across the enterprise .” Varatharaj agrees with this sentiment and says, “Hiring application and maintenance support during a recession can help companies free up time and resources for strategic initiatives” that will ultimately help them “emerge from the recession in a stronger position.” She says that existing IT teams can be more efficient when they’re relieved of routine tasks and have more time to focus on their own application development — which becomes even more critical when companies need to boost their bottom lines. Interested in more information about application maintenance from PRI Solutions? Find out more here.