Digital transformation spending to balloon to $7.4tn
Global technology research and consulting firm International Data Corporation (IDC) says spending on technologies and services that enable digital transformation will grow to $7.4 trillion in three years.
The firm also revealed its 2020 worldwide digital transformation (DX) predictions, highlighting the critical business drivers accelerating DX initiatives and investments as companies seek to effectively navigate business challenges, compete at hyperscale, and meet rising customer expectations.
Unveiling its “IDC FutureScape: Worldwide Digital Transformation 2020 Predictions”, the firm says the largest growth in DX will be in data intelligence and analytics.
During a Web conference, IDC analysts Bob Parker and Shawn Fitzgerald shared their views on the industry predictions that will impact the DX efforts of CIOs and IT professionals over the next one to five years.
The duo offered guidance for managing the implications these predictions harbour for their IT investment priorities and implementation strategies.
According to the IDC, by 2024, leaders in 50% of G2000 organisations will have mastered “future of culture” traits such as empathy, empowerment, innovation, and customer- and data-centricity to achieve leadership at scale.
Further, the firm says by 2022, empathy among brands and for customers will drive ecosystem collaboration and co-innovation among partners and competitors that will drive 20% collective growth in customer lifetime value.
It also anticipates that with proactive, hyper-speed operational changes and market reactions, artificial intelligence-powered enterprises will respond to customers, competitors, regulators and partners 50% faster than their peers.
IDC forecasts that by 2023, 50% of organisations will neglect investing in market-driven operations and will lose market share to existing competitors that made the investments, as well as to new digital market entries.
Another prognosis is on digitally-enhanced workers: “By 2021, new future of work practices will expand the functionality and effectiveness of the digital workforce by 35%, fuelling an acceleration of productivity and innovation at practising organisations.”
Additionally, the research firm says, by 2025, 80% of digital leaders will devise and differentiate end-customer value measures from their platform ecosystem participation, including an estimate of the ecosystem multiplier effects.
IDC also says digital key performance indicators (KPIs) will mature. “By 2020, 60% of companies will have aligned digital KPIs to direct business value measures of revenue and profitability, eliminating today’s measurement crisis where DX KPIs are not directly aligned.”
“Now in its fourth annual instalment, our digital transformation predictions mark the next set of inflection points and related consequences executives should evaluate for inclusion into their multi-year planning scenarios,” says Fitzgerald.
“Direct digital transformation investment is growing at 17.5% CAGR and is expected to approach $7.4 trillion over the years 2020 to 2023, as companies build on existing strategies and investments, becoming digital-at-scale future enterprises. Organisations with new digital business models at their core are well positioned to successfully compete in the digital platform economy.”