The State Of Digital Business Transformation, 2018
- April 29, 2018
- Kenneth Cheung
- #digitaltransformation, #financialservices, #fsi, #iot, #manufacturing, analytics, bigdata
- 95% of start-ups have digital business plans compared to 87% of traditional enterprises founded 50 years ago or later.
- 55% of startups have already adopted a digital business strategy compared to 38% of traditional enterprises.
- 62% say delivering an excellent customer experience as measured by customer satisfaction scores defines success as a digital-first business.
- Start-ups can increase revenue by 34% relying on digital-first strategies, with all enterprises increasing revenue by 23%.
- Big Data/Analytics (58%), mobile technologies (59%), private cloud (53%), public cloud (45%) and APIs and embeddable technologies (40%) are the top five technologies already implemented.
- 49% of IT executives say Internet of Things (IoT) plays a key role in their digital business strategies.
These and many fascinating insights are from the IDG’s 2018 State of Digital Business Transformation (12 pp., PDF, no opt-in). The study’s goals are to gain a better understanding of how organizations are evolving to a digital business model in regards to how they are revising technology strategies, changing organizational structures and processes, and innovating to provide a unique customer experience. Respondents were selected from CIO, Computerworld, CSO, InfoWorld, ITworld and Network World tech buyer audiences. The majority of respondents are IT executives and professionals. Please see page 10 of the study for additional details regarding the methodology. “Technology has been a driving force in business transformation for years, but the pace at which new technologies are launching has reached its fastest speed. Now is the time to create efficiencies and differentiate through the customer experience,” said Brian Glynn, chief revenue officer, IDG Communications, Inc.
Key takeaways from the study include the following:
- 89% of enterprises have plans to adopt or have already adopted a digital-first business strategy with Services (95%), Financial Services (93%) and Healthcare (92%) leading all industries. Education, high-tech, manufacturing, retail, and government are also quickly adopting digital-first strategies to improve process efficiencies and meet and exceed customer expectations.
- Big Data/Analytics (58%), mobile technologies (59%), private cloud (53%), public cloud (45%) and APIs and embeddable technologies (40%) are the top five technologies already implemented. Additional technologies currently in production include Application Performance Monitoring (APM) (18%), microservices and containers (15%), Software-defined storage (SDS) (14%) and Software-defined networking (SDN) (14%). Artificial Intelligence (39%), machine learning (34%), and the Internet of Things (31%) are the top three technologies enterprises are researching today.
- Big Data/Analytics, mobile technologies, and private cloud contribute most to an organization’s revenue growth. IDG analyzed which technologies are contributing most and least or revenue growth. With 49% of enterprises saying excelling at managing business performance through data availability and visibility is what defines their digital business, it’s understandable why Big Data/Analytics is perceived by 70% of IT executives as contributing to revenue growth.
- 61% of enterprises say IoT plays a role in their digital business strategies with manufacturing and high-tech leading all other industries. Just 39% of small & medium businesses (SMBs) say IoT plays a role in their digital business strategies today. Finance and government industries are the least likely to adopt IoT as part of their digital business strategies due to legacy systems being very difficult to change or integrate with and security concerns.
- 73% of manufacturing executives or IT decision makers (ITDM) says IoT plays a role in their digital business strategy, with 69% saying IoT is used to monitor equipment and machinery today. 24% of manufacturing IT executives interviewed say IoT is in production in a business unit or division. Creating a business case in manufacturing for IoT begins by looking at how quality, time-to-market and production performance can be improved. The manufacturing metric Overall Equipment Effectiveness (OEE) is one of the primary catalysts driving real-time monitoring including IoT adoption across manufacturing today.
- Start-ups can increase revenue by 34% relying on digital-first strategies, with all enterprises increasing revenue by 23% with new product and service offerings being the largest contributor to revenue growth across all companies. 30% of all enterprises interviewed by IDG say that new product and service offerings are the primary sources of revenue growth for their companies, followed by adding new capabilities inside the company and improving sales capacity to cross-sell and upsell. 22% say that their improved ability to integrate and analyze company, customer and external data is contributing to increased revenue. 22% also credit digital business strategies with the ability to increase product and service delivery speeds. New partnerships, global or regional expansion and M&A (merger & acquisition) activity are the remaining factors driving revenue growth. Multiple responses were allowed to the original survey.
- Enterprises’ definition of a digital business varies from enabling worker productivity to meeting customer experiences. 52% of enterprises say enabling worker productivity through tools such as mobile, data access, and AI-assisted processes are the essence of their digital business strategy. 49% say better managing business performance through data availability, and visibility is what defines their digital business, and 46% say meeting customer experience expectations using digital technologies is the center of their digital business.
- 62% say delivering an excellent customer experience as measured by customer satisfaction scores defines success as a digital-first business. The intensity to gain high customer satisfaction scores in retail is high, with 79% saying this is by far their most important benchmark of a successful digital-first business. 70% of manufacturers define the digital-first business strategies as successful when they improve process efficiency through automation. 53% of services companies and 51% of finance companies define digital-first business success by their ability to accelerate time-to-market.
By Louis Columbus
Louis Columbus is an enterprise software strategist with expertise in analytics, cloud computing, CPQ, Customer Relationship Management (CRM), e-commerce and Enterprise Resource Planning (ERP).