“By 2018, one third of the top 20 companies in every industry will have been disrupted by digitally transformed competitors.” So says Frank Gens, chief analyst at IT intelligence specialists IDC. In simpler terms, that means there’s an Uber knocking at the door of almost every company in every sector.
In a recent report by IDC, Gens makes many more predictions about the our digital future: by 2018, almost 50% of IT budgets will be allocated to digital transformation; by 2020, 60% of companies will consider digital transformation so important that they will have created a specific executive position, along the lines of a Chief Digital Officer, to manage it; and in three years there will be over 22 billion internet-of-things devices creating a market for some 200,000 new apps and services.
The message to industry is clear: Transform or die. In the late nineties, the e-commerce revolution began to transform traditional ways of buying and selling
goods and services. Many companies that didn’t transform found themselves “Amazoned”. But unlike the rise of e-commerce, the next revolution will not be just a new way of doing old business; it’ll be a complete change in the business paradigm. As TechTarget’s Tom Goodwin astutely puts it; “Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the world’s most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate. Something interesting is happening.” All are digital businesses.
Code is King
For companies to navigate the transformation era successfully, the way they identify, manage and monetize data will be key. The ability to grow will depend largely on their digital innovation capacity, meaning that every company will, to some extent, become a software company – Gens predicts that enterprises with DX initiatives will double the size of their software development teams by 2020 as they invent ways of harvesting data and turning it into a store of value.
Capturing and utilizing the huge amounts information pouring out of the internet of things (and connecting it through its big brother, the internet of everything – the IoE) is another crucial factor in transformation success. And this isn’t limited to businesses; the public sector has much to gain out of leveraging the IoE – a recent white paper by Cisco states that the IoE will generate $4.6 trillion in Value at Stake for the public sector over the next decade (compared with $14.4 trillion for the private sector). Even smart parking – capturing data from parking meters so residents can identify available parking spaces and pay for them using an app while allowing municipalities to introduce variable pricing – will generate $41 billion of Value at Stake in the next ten years.
The Cloud is the new IT
IDC predicts that by 2018, 50% of IT spending will be cloud-based, and that companies with developed DX strategies will enter into partnerships with industry cloud platforms to scale up their digital supply and distribution networks. While the public cloud market will be consolidated into six “mega-platforms”, including Amazon, Google, IBM, Microsoft and Salesforce, industry platforms will flourish allowing enterprises to “create innovation communities, reinventing their industries and how to source and distribute innovation on a massive scale.”
In short, IT will soon be driven “by doing entirely new things rather than using new technologies to do old things,’” according to Gens.
ictQATAR hosts Digital Transformation seminars
In Qatar, enterprises and organizations will need to address the impact of these technologies, and use them to create competitive advantage and ensure sustainability. To this end, the Ministry Information and Communications Technology (ictQATAR) is hosting a series of Digital Transformation seminars in Doha, where attendees can explore strategies through local and international cases studies, presentations and discussions. The next seminar “Digital Transformation: The Digital Evolution of Business”, on 2nd February at the Four Seasons Doha, will include presentations by Naim Yazbek, GM Microsoft, Pedro Pereira Head of SAP Digital and Smart Cities (SAP MENA), and Dr. Hilmi Rifai, Executive Partner at Gartner.
Spaces are limited – click here to register: http://www.ticketfun.me/ictqatar