AI agents and automations will dramatically increase every growth-oriented company’s tech spend.
In the past, tech has been a necessary part of peoples’ jobs. A CRM or an ERP or email houses information or enables communication or other work that previously was too slow. That said, it was just enabling the humans to do more or better work.
IT budgets were some not-insignificant percentage of revenue – call it 5% or 7%, but it was a cost center.
AI agents & automations are increasingly doing the work for the employees or doing the work instead of needing to hire new employees. Instead of going out and putting out another job posting, companies are beginning to wonder “What if we automated the work instead?” Or “what if we automated half of [key person’s job] so they could do this new work instead?”
As agents get more capable, the IT budget as a percentage of revenue will go up because the productivity will expand exponentially. IT may become 20% of revenue, but it’s a cost savings measure because there are fewer salaries being paid to fulfill the revenue leading to fewer taxes and more growth.
For Teammate AI, that means that not only are more companies going to need advanced tech, but each company will have greater needs in the future than they will now.
For nontechnical companies, what that means is that AI will become a new step before determining if you want to put out a job posting. “Could we automate this?” Or “Can we automate someone else’s job so they could do this?” Will be a strategic discussion at both leadership but also with any impacted employees.
Keep in mind that, for an IT budget to become 20% of revenue, key operations may need to be 5X or 10X more efficient.
But, if they are that much more efficient, the increase in gross margin on those key operations are astronomical and the revenue growth potential skyrockets.
