The recent and ongoing environment caused by the coronavirus pandemic has obviously created many difficult challenges. Several weeks ago, we hosted a webinar and had a great discussion amongst CTO peers about what we’re collectively experiencing and how we’re handling those circumstances. This article summarizes that conversation.
What is everyone experiencing?
Most sectors have been experiencing extreme difficulty in terms of retaining revenue in order to support ongoing operations at pre-pandemic levels. Certainly, the obvious sectors most dramatically affected by the government mandated shutdowns have suffered the biggest challenges. But also, with people spending less across the board, many others also saw revenues significantly contract.
By contrast, select industries such as biotech, healthcare, telecommunications, social media, and at home entertainment have seen unprecedented surges in demand. This demand dictates its own set of challenges to overcome in order to adapt and scale more quickly than could have been anticipated. Overall, the complexion of demand has changed.
How does it change how we should build software?
We have seen a shift to what I’ve been calling the “urgent homework assignment due next week” approach to software development. Across all segments, including government for reasons such as supporting the massive influx of unemployment claims, teams have scrambled to keep up while also having to, in large part, adapt to an immediate shift to all remote work.
This approach is necessary but also unsustainable in the long term.
For Those Negatively Impacted
Remote working was thrust upon all non-essential workers. Many tech organizations were already set up to handle remote teams but some either had to switch to it from scratch and most had to move from some remote work to all remote work.
The importance of high quality communication tools such as Slack, as well as solid design and development tools and processes became paramount overnight.
After the initial shock, this could actually turn out to be a silver lining — not just in tech organizations but the world over. We could very well have made decades of remote work progress in the course of 3 months. Remote working for tech teams not already accustomed to it did not seem to be a major issue.
Reducing staff costs with an offshore team and the different ways to integrate them
If you’re not already leveraging a nearshore or offshore team, now might be the time to seriously consider it. It’s a difficult situation and certainly not the one you’d like to be facing when making this decision but reducing staff costs might be necessary. And if it is, you can shift some of those costs to a remote team that supplements your core anchors.
In the current environment, you will find additional discounts as nearshore and offshore companies seek to not only minimize the layoffs they have to enact but also as they look to help companies struggling with incredibly tight budgets survive. At Actualize Partners, for example, we have worked with many of our clients to provide additional short term discounts to help them through these challenging times.
There are multiple ways to integrate new teams or remote team members. The way we prefer to work is to serve as an extension to your existing core team. We accomplish this through hiring only A players who have a deep passion for what they’re working on. Constant Slack interactions, regular video calls, and complete transparency are some of our core tenets. In addition to time proven, repeatable product engineering processes tailored to your specific set of circumstances. And partner level engagement at every step of the way.
Reduced budgets (re-evaluating the product roadmap and reducing team size)
Other ways to reduce spend include slowing down the product roadmap and shifting to lower overhead ways of working. One thing to be cognizant of while assessing these approaches, however, is to ensure you’re not just cutting to cut — but cutting to cut AND diligently going through the thought exercise of how the current and probable future environments may change what you want to invest in when.
Customer demand has shifted and will likely remain shifted for quite some time so prioritization may need to change, or features that weren’t envisioned previously may be required.
Layoffs, downsizing, and retaining talent
We are all in this together. As stressful as these times are for you, please remember that things may be even more stressful for your employees. Prioritize empathy and kindness. But be honest and direct — false hope will only make things worse later. And consider all ways to retain talent before enacting layoffs. Perhaps everyone would be willing to take a 20% pay reduction instead of having to fire a portion of the team, for example.
Reducing AWS costs
There are some strategies to reduce AWS spend that you can take a look at here.
For Those Seeing Increased Demand
Taking advantage of layoffs by hiring talented engineers
If you are in a position to continue either business as usual, or even to grow because you are seeing increased demand, there are many great resources that have been put together such as lists of newly available high caliber talent. These resources are continuously evolving but can be found through industry Slack teams, email groups, and also on some company websites.
More demand and ICP shifts
Similar to how you’d need to reassess your roadmap if reducing burn is a necessity, you should take a step back and think through in a systematic way how increased and/or shifts in demand impact your product or service offerings. There are likely novel ways that would not have been previously conceived of to increase not only revenue, but the true value delivers to clients.