According to Bloomberg, some analysts are seeing signs that profit margins are peaking. In today's market wrap, one analyst calls out slowing economic growth as cause for concern. One of the best ways for a company to insulate itself from mild to moderate economic slumps is to boost productivity. With this in mind, watchful boards and forward-thinking CEOs may be looking to their Chief Information Officers for new strategies designed to shed costs, increase output, and protect profits.
A number of MyFractionalCIO executives met this morning to discuss the economic indicators, and are recommending that the bulk of our fractional CIO portfolio companies bring IT automation initiatives to the fore now rather than later, with priority given to cost-neutral strategic technology initiatives that preserve capital.
We believe that this is a sound strategy under most economic conditions, but especially wise for middle market companies who may be unable to sustain a loss of growth or margin if an economic downturn materializes. Of course, if the economy rebounds, any productivity gains will continue to fuel our portfolio companies' market growth and improve their bottom lines. That's a win/win for any IT strategy playbook.