Tech under pressure: navigating tough trade-offs amid rising costs

Technology leaders are reconciling a tough dilemma right now.

Among constant change and disruption, they’re tasked with “keeping the lights on” and ensuring a stable, secure and reliable technology estate, come what may. Amid ongoing cost inflation, with SaaS vendors hiking prices by up to 20% in 2025 according to Gartner, that requires increasing amounts of cash, explains Ben Cobb, technology transformation director at KPMG UK. At the same time, they’re also delivering substantial ERP-led digital transformations that require significant investment and, more recently, managing the excitement around novel and experimental technologies like AI, which are crucial to future success.

“When social media came along you could deploy a bunch of people and it was all they had to think about, but AI doesn’t work that way”

– James Poulter, CEO and founder, ThreePoint

The inevitability of fixed budgets, coupled with growing demand, is that senior technology leaders need to make constant, considered trade-offs, points out Cobb. That often means opting for “aggressive technology cost control” measures in order to free up the budget they need for longer-term investments. Or investing in tools that deliver productivity gains now, in order to unlock longer-term value from their tech stack. It’s a pressure cooker – one in which leaders are “forced to make really tough trade-offs when it comes to where they invest, and where they scale back”.

So, amid these competing demands, how can they make decisions with some degree of certainty?

Agility as a high-performance trait

Managing this tension between short- and longer-term interests calls for technology leaders who have clarified their vision, but who aren’t afraid to explore different routes to getting there.

For example, KPMG’s own Global Tech Report found that while 56% of companies overall say plans can quickly become outdated because of the pace of change, that proportion was far lower (only 16%) across high performers, suggesting a close link between agility and growth. This doesn’t mean endless experimentation or iteration, says Cobb. “It’s about having a strategy that is your North Star but being willing to adapt, evolve and pivot when you need to. That’s really important.”

It’s a balancing act – one made only more challenging with the emergence of generative and agentic AI, agrees James Poulter, CEO and founder of AI transformation consultancy ThreePoint. Unlike previous developments in enterprise technology, such as the rollout of the upgraded Microsoft Office suite in 1997, the challenge of AI is that it rewrites everything, and it affects everyone within the business, he believes. “When social media came along you could deploy a bunch of people and it was all they had to think about, but AI doesn’t work that way.” Siphoning AI into pockets of specialists is like “showing up to a marathon on a bicycle”, he observes. It requires system-level change.

Creating ‘strategic enablers’

Empowering a workforce with core competencies around technology such as AI has become another core strategy for businesses adapting to the current technological landscape.

At Danone for example, it has been instrumental in helping the business to “move faster” and adapt to the pace of wider technological change, says Ross Davies, VP of HR for North Europe.

In 2024, the organisation launched an AI literacy programme designed to upskill and reskill approximately 100,000 employees, including the distribution of 10,000 Microsoft 365 Copilot licences on day one of the initiative. By disseminating the technology en masse, the business could more quickly demonstrate the commercial value, catalysing further investments.

“This approach is helping build confidence and a shared language between business teams, IT and data experts, which is essential as AI becomes part of day‑to‑day decision‑making rather than a standalone innovation topic,” says Davies. “In 2026, we will continue to embed these tools, building on our responsible AI and compliance programmes and ensuring leaders can fully leverage data and AI as strategic enablers.”

Navigating towards a ‘North Star’

Given that the current influence of AI or social commerce might have been unthinkable 10 years ago, it can feel impossible for technology leaders to accurately forecast the landscape in which they’ll be operating 10 years from now.

To obviate this, bring it back to that ‘North Star’ of long-term value and sustainable growth, recommends Cobb, and make changes that align with those immovable goals, no matter how the technology shapeshifts.

“It’s about having a strategy that is your North Star, but being willing to adapt, evolve and pivot when you need to. That’s really important”

– Ben Cobb, technology transformation director, KPMG UK

This certainly rings true for Sue Bell, former head of technology at M&S, and newly appointed chief technical officer at The Compleat Food Group, a role that combines technical, ESG and safety, health and environment (SHE) functions.

“Fmcg businesses can navigate this backdrop [of rapid change] by combining curiosity and agility, and anchoring both firmly in food safety, cost control and outcomes that genuinely strengthen the business,” she says. “That means starting with the business problem rather than the technology, ensuring investment delivers clear value, and using tools like AI to enable better decisions, supported by strong data, governance and a ‘quality over quantity’ approach.”

Prioritising ‘no regrets’ moves

Torn between fluctuating and competing demands, there are some “no regrets” actions that can help keep technology leaders on course whatever the future holds, says Cobb.

This includes foundational steps like cleaning up data. After all, “the time and cost of addressing data problems after the fact caps your ability to deploy and realise the value of your technology investments and, ultimately, impacts your ROI, ” he says.

“It also means that when you do start to deploy AI tools and platforms, you’re able to utilise their full power and capacity to drive decisions from the outset. Data is fundamental to all of that.”

“When you harness the capability and insight of the whole team, you create more effective, sustainable change”

– Sue Bell, chef technical officer, The Compleat Food Group

Equally, make sure you optimise your existing cost base in order to meet increasing business demands and rising technology costs, whatever direction these may take, adds Cobb. Understanding the levers you can pull and the impact of these is crucial – whether that’s fundamental changes to your operating model, optimising your 3^rd party spend or rationalising your application estate.

However, perhaps most crucial is looking at how you collaborate and coordinate with other senior leaders across the business in making these tough trade-offs around technology.

“When you tackle challenges with clarity of purpose and harness the capability and insight of the whole team, you create more effective, sustainable change and better outcomes for customers and the business,” says Bell.

These decisions need to be a shared endeavour across the C-suite, says Cobb. The traditional lines between technology and the rest of the business have blurred, and that means that everyone in senior leadership, not only a CIO or CTO, needs to understand the options, the uncertainties and the compromises.

The complexities, too, points out Poulter. For example, “no one was sat around having an ethical dilemma about whether or not their email provider was going do a deal with the US Department of Defense. Now, that’s the type of thing that you actually have to consider when choosing AI models.”

Yes, technology leaders are no strangers to being asked to do more with less. But now, as that pressure ramps up a notch, they shouldn’t have to shoulder these decisions alone.