The Breakthrough of AI in an Economic Downturn

The uncertainty of whether interest rates will remain high or be lowered again is impacting how companies and businesses are valued in relation to the underlying indexes on the market. This drives companies to be very thoughtful about their budget planning and spending, which leads to pressure on vendors, mainly from procurement departments or buyers.

At the same time, we are witnessing a breakthrough in technology with the advancement of AI and its potential impact on productivity, which in itself is a counterforce that can help companies to balance margins by doing more with less.

These forces are also impacting businesses in central Europe that are servicing international clients, particularly in the tech sector, due to the talent pool that exists in the region and contributes to international engineering teams. Understanding those dynamics is critical for companies to ride out the downturn and come out of it in a strong position.

The potential that lies within AI to increase productivity cannot be overlooked as just hype. It has been steadily on the rise for the past several years, and now it is nothing short of a breakthrough. The strategies of utilizing AI will serve as ‘make or break’ regarding companies’ competitive advantages.

At Exadel, we are witnessing this dynamic daily. We must focus on helping our clients leverage this technology for their benefit and competitiveness. Many of our projects support in-house teams with external expertise. Utilization of AI in our delivery processes, for example, could allow our clients to proactively engage our staff when demand is more predictable, preventing resource shortages or overspending, which is the core value they are seeking.

In our sector, AI-driven processes can help integrate new resources more smoothly into existing teams. As a reaction to the economic downturn, CTOs and product managers are being very thoughtful about their workforce and are looking to leverage strategic partners, as it helps them to get IT project budgets approved. Using AI-based tools to improve engagement with staff is a fantastic opportunity to do more with less while retaining the principle of not compromising on quality.

The breakthrough of AI as a balancing factor in a downturn market is the innovation needed to drive markets forward. Though AI is not without its risks and requires ongoing ethical monitoring, it will play a critical role in our work and lives going forward, including and perhaps especially during an economic downturn.

Eyal Zucker,
Managing Director at Exadel Hungary