8 minute read 7 May 2020
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COVID-19: What’s next for the technology sector

By Rahul Gautam

EY Consulting Global Technology Sector Leader

Accelerating growth for some of the world's largest and most innovative tech companies. Passionate about deploying technology to solve major world problems.

8 minute read 7 May 2020

How can technology companies create growth opportunities in the post-COVID-19 world?

In recent weeks and months, the primary focus — quite rightly — has been on the impacts of the COVID-19 pandemic on lives and economies worldwide. However, behind the headlines, a number of fundamental shifts have occurred whose implications for the tech sector extend far beyond the crisis.

A period of radical change …

A few recent numbers tell the story. According to Nokia’s COVID-19 Network Traffic Dashboard¹ weekday internet traffic has increased by over 40%. Usage of cloud-based collaboration platforms has also surged, with Microsoft Teams logging a record 2.7 billion meeting minutes on 31 March, three times the 16 March level.² Meanwhile, air quality has improved by up to 40% in cities that implemented lockdown measures.³ But there’s an undeniable near-term economic downside: the Peterson Institute projects that global GDP will fall by 3.4% in 2020⁴, with the US unemployment rate reaching almost 20%.⁵

Increase in internet traffic


The increase in weekday internet traffic, according to Nokia’s COVID-19 Network Traffic Dashboard⁶

…has called for radical responses

All of these impacts have occurred against a background of sudden and enforced social distancing. So, how have tech companies responded? Drawing in many cases on the EY Enterprise Resilience Framework, they’ve navigated robustly through the initial turmoil of the pandemic, moving at pace to make radical changes to their businesses.

Key actions have included activating business continuity planning (BCP) protocols and ensuring the safety of employees, while mobilizing work-from-home infrastructures, including securing the operational effectiveness of shared services and call centers. Tech companies have also been assessing the impacts of the crisis on near-term revenue opportunities while triaging cash collections and assessing liquidity positions. Some have introduced “free” entry-level offers: witness Cisco making Webex free to new customers for 90 days⁷ and Microsoft offering free access to Microsoft Teams for six months.⁸

Now it’s time to take stock

The net results of all these actions? Stabilized operations — and a strong-enough platform from which to seek out and target the growth opportunities that are certainly out there.

As we emerge from the crisis, now’s the time for tech companies to carry through with  the resilience they’ve shown during it. This means taking a deep breath, reassessing the “Now” — and working out what’s “Next.” The question for tech leaders to address is this: “Now that the immediate maelstrom is behind us, how should we be responding to the risks and opportunities we face in the coming one to three months?” If you don’t answer this question, you can be sure your competitors will.

Five priorities to reenergize your growth trajectory

As EY teams identified in the article, Building adaptive digital enterprises,⁹ the combination of exponentially accelerating innovation and unprecedented geopolitical and economic uncertainty means success in the tech sector now depends less on particular products or services, and more on building platforms that can adapt to unforeseen opportunities. Nextwave technology companies will outpace the competition, not because they’re better at predicting the future, but because they are world-class at orchestrating a diverse ecosystem of producers, service providers and customers to service new demand rapidly. They’ll also have the financial agility and effective contingency plans needed to respond, stabilize, recover and, then, reimagine growth.

To seize revenue opportunities, tech companies should focus on five priorities:

1. Re-segment customers and markets

Examine your current customers and markets to challenge the segmentation models you rely on to drive decisions. In the coming weeks and months, your most reliable and predictable customer segments may well demand to be served in entirely new ways. And these new behaviors may change again before long. Adopting “dynamic customer segmentation” will enable you to meet customers where they are and pinpoint new opportunities.

How? Take three common customer segmentation variables in IT services companies:

  • Cost of sales
  • Account leader tenure
  • Service/offering penetration

In normal business conditions, it’s clear how each of these helps decision-makers prioritize sales and marketing resources. But after the pandemic, opportunities may exist at prospects where you lack long-standing relationships or where a first-time sale would be far costlier than selling to an existing customer. Tech providers that refocus their segmentation toward new addressable opportunities will be better placed to stay relevant and discover new paths to growth.

2. Reimagine the sales experience

Adapting your sales process to a world of remote touch points will pay you back for years. While it’s unclear how long social distancing will last, it’s safe to assume two things. First, a return to meaningful face-to-face sales interactions is a long way off. And second, any innovation in the sales experience that drives expense-to-sales ratios down will be welcomed by customers and investors alike.

Before the pandemic, a FinTech organization scaled its remote selling capability for new and existing customers, with a focus on driving sales productivity for “long-tail” customers too costly to reach through field-based sales programs. Now the focus is shifting to remote and digital selling for customer retention and sales growth, with the added value levers including:

  • Orchestration of digital first into digitally assisted client interactions
  • Algorithmic cross-sell and up-sell sales programs
  •  Honed remote product demonstration capabilities

The pandemic has made it imperative to expand remote selling capabilities and behaviors across all field sales associates and for customers of all sizes, while minimizing channel conflicts. Tech leaders already have collaborative sales models meshing together field, desk and digital. Now this “nice to have” has become a core capability that will be key to reinvigorating growth.

3.  Build the financial agility not only to survive, but to thrive in a post-pandemic world

Some tech companies with strong balance sheets are already eyeing potential acquisitions, while many others are struggling to operate in a remote environment with antiquated finance and accounting processes. Liquidity and continuity are key concerns of the “Now”; optimization of finance and operations and strategic planning for the “new normal” should be the focus of the “Next.”

Changes ahead


of 4,500 finance leaders polled by EY in March 2020 anticipated changes to their close process, with almost a quarter expecting a high degree of uncertainty.

In a March 2020 EY poll of 4,500 finance leaders, 82% anticipated changes to their close process, with almost a quarter expecting a high degree of uncertainty.10 But while the “Now” is uncertain, it presents finance leaders with a golden opportunity to drive radical simplicity into the finance function. Optimizing or automating key finance and accounting processes will make it far simpler to operate a remote close process, while also increasing accuracy, speed and flexibility. The essential steps to enable a remote close include:

  • Establish a virtual close command center — enabling cross-functional issue resolution in real time
  • Re-calendar close procedures — adjust timeline, add in a mock close
  • Anticipate deep dives — incremental effort to validate accounts and assess risks given the current environment.

Given the likelihood of a “see-saw”-shaped recovery, the ability to create flexibility and renewed reliability within finance and accounting will separate the well-prepared from the consolidated in the next 6 to 12 months.

4.  Treat remote working as an opportunity

You might feel remote working is a temporary inconvenience. Far from it: the rapid migration to working from home can create new levels of efficiency, productivity and employee satisfaction that seemed unattainable just a few months back. Tech companies’ greatest challenge has always been talent — especially finding and retaining the right talent in the right place. But now you have access to any talent anywhere and can keep employees happy through a lifestyle more suited to them as individuals. So, the challenge has shifted to how to make them feel part of a team and to adapt your processes to remote workflows.

Tech leaders have already been applying frameworks11 (see below) to adopt hosted remote working and collaboration solutions such as Microsoft Teams.

Six step framework graphic

Tech leaders have already been applying a six-step framework12

Nextwave technology companies are also elevating productivity to new levels by integrating other enterprise systems and data into these workflows, including sales and pipeline data. In the coming years, ongoing adaptation and innovation will continue to increase the benefits from the permanent shift in where work gets done.

5. Double-down on security

Your company’s rising reliance on digital infrastructure must be mirrored by increased investments in security, made at pace — or even faster. When it comes to protecting your business, the rapid shift in work activities from offices to homes presents unique challenges. Are home networks as physically and digitally secure? Are employees knowledgeable and diligent enough to maintain effective remote working security practices? Such questions are business-critical: according to the EY 2020 Global Information Security Survey, TMT companies rely more on people in business functions than any other source to detect security breaches (52%).13

In a March 2020 article, EY Global Consulting Cybersecurity Leader, Kris Lovejoy set out five steps to defend against opportunistic cyber attackers amid the pandemic. Once the immediate crisis has passed, companies must keep up their guard — and maintain consistent, comprehensive, and centralized monitoring and policing of security practices across their remote workforce.

Riding the up wave

The past few months have been challenging for tech companies. But as the pandemic recedes, companies my find growth opportunities to seize.

But how? Nobody can predict the future, and there’s no silver bullet. This isn’t a time for big, long-term bets. The companies that will differentiate themselves across TMT will be those that can sense, respond and adapt to unforeseen change.

That is what’s “Next.” It’s time to reimagine your business in ways only a pandemic could force and take decisive steps to open new avenues of growth and embrace more sustainable ways of operating. That’s the way to power your next growth wave. And the time to start? Today.

  • Show article references#Hide article references

    1.  Keeping the World Connected,” Nokia
    2.  “Remote Work Trend Report: Meetings,” Microsoft
    3.  “Climate crisis: in coronavirus lockdown, nature bounces back – but for how long,” The Guardian, 9 April 2020 via Factiva, © Copyright 2020. The Guardian. All rights reserved
    4.  “The Economic Outlook: Pandemic and Recession (pdf),” Harvard University and Peterson Institute for International Economics Spring 2020 Global Economic Prospects Meeting, 10 April 2020, 
    5.  “The Economic Outlook: Pandemic and Recession (pdf),” Harvard University and Peterson Institute for International Economics Spring 2020 Global Economic Prospects Meeting, 10 April 2020, 
    6.  “Keeping the World Connected,” Nokia
    7.  “Paid software and services available for free during the pandemic from Microsoft, Facebook and more,” TechRadar Pro, 9 April via Factiva, © 2020. Future Publishing Ltd. All Rights Reserved.
    8.  “10 free Zoom alternative apps for video chats,” CNET News.com, 6 April 2020, via Factiva, (c) CNET Networks Inc. All Rights Reserved.
    9.  “Building adaptive digital enterprises,” EY
    10.   EY Webcast, “Completing your first remote financial close” March 2020, N=3,286
    11.  The EY and Microsoft Alliance, “Microsoft Teams adoption Supporting remote collaboration,” EY2020
    12.  The EY and Microsoft Alliance, “Microsoft Teams adoption Supporting remote collaboration,” EY2020
    13.  “EY 2020 Global Information Security Survey,” EY 2020


A number of fundamental shifts have occurred from the COVID-19 pandemic, and the implications for the technology sector are extending far beyond the crisis. Focusing on five key priorities – from embracing remote working cultures to doubling down on your digital security infrastructure – can help companies reenergize their growth trajectory in the new normal.

About this article

By Rahul Gautam

EY Consulting Global Technology Sector Leader

Accelerating growth for some of the world's largest and most innovative tech companies. Passionate about deploying technology to solve major world problems.