Balancing the optimiser and innovator mindset in IT strategy

The tension between cutting costs through efficiency and driving growth through innovation is more pronounced now than it has been in decades. But businesses don’t have to choose one over the other: they can strike a balance.

Robert Frost captured this dilemma in The Road Not Taken: "Two roads diverged in a yellow wood, / And sorry I could not travel both”. Many business leaders likely feel the same when deciding whether to prioritise cost savings or revenue growth. At the core of this false choice are two leadership mindsets: the optimiser, focused on cost reduction and efficiency, and the innovator, driven by transformation and growth. Success requires both: managing immediate challenges while securing the future.

A question of cost

Efficiency is essential for keeping a business financially strong. The optimiser mindset focuses on cutting costs, managing risks and streamlining operations — especially critical in times of economic uncertainty. Right now, rising operational costs and tighter IT budgets are driving enterprises to prioritise efficiency. According to an internal study conducted with Ecosystm in 2024, Australian organisations allocate just 5.08% of their revenue to IT, reinforcing the need to do more with less.

The study also found that 63% of Australian enterprises see IT modernisation as a cost-driven initiative, and 53% believe it can help reduce broader expenses. This has increased demand for strategies with immediate ROI, such as cost optimisation through managed services and streamlined IT operations. Many enterprises are also using cloud platforms like Microsoft Azure to simplify operations and scale more effectively, aligning IT investments with changing business needs.

Modernisation and innovation

Despite economic pressures, innovation remains crucial, especially in sectors like financial services, education and health care. The innovator mindset prioritises investment in emerging technologies — AI agents, data analytics and cloud native applications — not just to cut costs but to drive growth and unlock new revenue streams.

For many optimisers, IT modernisation is the solution. The same is true for innovators. Modernising IT infrastructure bridges both mindsets, enabling businesses to balance efficiency and transformation. By adopting scalable, secure platforms and modern IT assets, organisations can reduce costs while positioning themselves for long-term growth.

A balanced approach

While the optimiser and innovator mindsets may seem at odds, businesses can align them strategically. By leveraging modern IT solutions and taking a balanced approach, organisations can manage immediate economic pressures while positioning themselves for future growth. It doesn’t have to be a choice between one or the other.

A great strategy uses efficiency gains — such as reducing IT complexity — to free up resources for innovation, like AI readiness and infrastructure modernisation. Rather than retreating entirely into an optimiser mindset, businesses should reinvest cost savings into transformative projects that drive long-term success. This creates a virtuous cycle. Modernising IT to improve efficiency generates the savings needed to fund innovation, which then fuels further optimisation and growth.

Strategic transformation

Modern IT infrastructure and managed services play a key role in driving both efficiency and innovation. In fact, Nexon’s study found that nearly 80% of business leaders plan to increase investment in infrastructure and data centres. At the same time, half of those surveyed cited optimised performance and efficiency as a top advantage of managed services.

By combining IT modernisation with managed services, businesses can reinvest cost savings into innovation and growth initiatives. For example, streamlining maintenance through modern technology and operating models frees up developers to focus on strategic innovations instead of routine operations. Separating maintenance from innovation helps maximise ROI while minimising disruption.

Investing in growth

Instead of trying to transform everything at once, the best way to align optimisation and innovation is through a modular approach. Businesses should assess their tech stack and make one of three decisions for each application: retire or migrate outdated solutions, minimise maintenance of non-core software, or invest and accelerate core assets.

One thing is clear: adequate investment is essential. For example, among mid-market businesses in Australia, lack of funding is the biggest barrier to AI adoption, a technology that drives both innovation-led growth and cost efficiencies.

Businesses should review their legacy IT infrastructure and consider whether they’re missing opportunities to leverage modern technology. The right IT investments can help develop digital tools that win new business, capture new markets and increase revenue while simultaneously cutting costs. Business leaders don’t have to choose between optimisation and innovation: both paths can be taken at the same time.

Image credit: iStock.com/BlackJack3D