Earlier this month, the U.S. Department of Labor Bureau of Labor Statistics reported that the nation’s workforce became a lot more productive in the third quarter. People have learned to the live the cliché “do more with less,” as productivity surged 8.1 percent. Yet, unemployment remains at 10 percent, and companies are looking for more ways to bolster results without having to hire.

The economic situation remains tricky. There are signs of a recovery, but businesses are remaining cautious, especially when it comes to assuming the ongoing expenses associated with new employees.

The notion of using technology to increase employee productivity isn’t new. Over the past several decades, we’ve seen the impact of prudently purchased and deployed systems on the efficiency of a workforce and a company’s ability to manage its costs. Today, the situation is more of a priority than ever.

There are three factors converging to make businesses refocus on IT investing: unemployment, productivity per employee and increased competition. When you put all three together, you can see how IT spending is increasing – and should continue to do so – even when executives are approaching economic conditions cautiously.

1. Unemployment: We’ve heard a lot about the “jobless recovery.” This is merely economist-speak for the fact that executives will turn to temporary and contract labor to verify that they can handle an expense before making hiring permanent. It’s also indicative of the fact that companies want to keep their options open. If there is a non-hiring solution available instead, such as IT infrastructure efficiency, they will have the flexibility to pursue it, cutting costs while boosting productivity further.

2. Productivity per employee: This measure reveals the success of cost containment and efficiency initiatives. If productivity increases faster than headcount, company executives can be confident that the measures they are implementing are having a positive impact on the company. This is particularly important for CIOs and IT directors, as they can justify investments in solutions that provide both near-term expense relief and a long-term benefit. Cuts that limit growth will come back to haunt executives. Cuts that don’t impair productivity – or, even better, improve it – lead to a better competitive position now and into a recovery.

3. Increased competition: When times for tough, your competitors will push a little harder to win every revenue opportunity. Slashing prices only works for so long – after a while, margins will just shrink too much. To withstand a price battle and continue to win on service, you’re clients will need to be able to be able to deliver cost-effective services that are competitively priced but which still outshine those of other players in the market. Increased efficiency makes this possible.

The conditions, both economic and competitive, thus favor aggressive IT investing, a trend we’ve noted in the marketplace. IT manufacturers and resellers should use this opportunity to open a frank dialogue with their clients and prospects about more than basic TCO and ROI factors. Identify the specific challenges that your clients are facing, and partner with them to architect IT solutions that remedy these economic and competitive conditions.

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