Organisations that will thrive in the digital economy are those that can execute a clear vision of digital transformation.
So said Philip Carter, research VP at IDC, speaking yesterday during the Oracle Partner Day in Johannesburg.
He pointed out digital technology has altered, and will continue to alter, the landscapes of business, education, entertainment, and government.
"To thrive in the digital economy, organisations must be able to blend digital and physical experiences to garner customer allegiance. They must also turn information into competitive advantage like companies like Uber, Airbnb and Amazon have done."
The digital enterprise must also be able to create digital revenue streams from connected systems, Carter noted, adding it should also leverage technology to win talent wars with competitors.
According to Carter, the most critical aspect of digital transformation is for organisations to understand third platform technologies that are impacting businesses.
IDC describes the third platform as IT that is built on mobile devices, cloud services, social networks and big data analytics. The first platform is the mainframe computer system, which began in the 1950s and continues today. The second platform is the client/server system, which began in the 1980s with PCs tapping into mainframe databases and applications.
The analyst firm believes third platform solutions will be the primary growth driver of the ICT industry over the next decade, responsible for 75% of the growth as worldwide industry spend moves from $3.2 trillion in 2013 to $5.3 trillion by 2020.
"By 2018, one third of the top 20 market share leaders in most industries will be significantly disrupted by new competitors and 'reinvented' incumbents that use the third platform to create new services and business models," Carter said referring to a recent IDC study.
He believes it is a challenge for business leaders to move their enterprises to the next level, that of digital business transformation, employing digital technologies coupled with organisational, operational, and business model innovation to create new ways of operating and growing businesses.
Carter urged organisations to re-think their account engagement approach if they are to survive in the digital economy. "If you are a service provider, you should move away from second platform sourcing models and lean towards the third platform," he said, adding this demands the right skills as well.
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