Which will be the Digital Transformation business trends in the near future? Several research institutes, including Forrester, Gartner and IDC have answered this question. According to Forrester, only 27% of current businesses has a coherent digital strategy, able to define in detail how the company creates value for its customers through digital business. Gartner states that 125,000 large organizations are launching Digital Transformation initiatives and that CEOs expect revenue from the digital world to increase by more than 80% by 2020. IDC, instead, expects that the percentage of firms which will focus on digital transformation projects around the world will double by 2020 (from 22% today to almost 50%).
The forecasts do not stop there; a new lexicon is even being created: IDC speaks of ”economics of digital transformation”, Gartner invented the term “algorithmic business” and Forrester “programmable Economics”. All idioms that recall the importance of digital transformation in business and in companies. But what do they mean? In order to fully understand, Forbes has put together a series of trends that we will see achieved during the new year (and even afterwards), extrapolating the contents precisely from the research by the various institutions. Here’s what we learned:
- Digital Transformation will become the strategic and fundamental driver for the majority of CEOs: this year CEOs will make a considerable effort to integrate various digital initiatives throughout the company, creating a clear, long-term vision in order to prove (based on available data) how digital experiences will generate revenue; furthermore B2B industries will begin to bridge the existing digital divide in respect of B2C companies, significantly superior (to date) in implementing winning digital transformation strategies.
- Big Data will be the backbone of Digital Transformation: data analysis will save about $ 60 billion per year by 2020; this will be possible because (while other companies will ignore big data) some companies will use the data to provide personalized services to their customers, but will also be able to implement tools and skills capable of extracting value from the continuous flow of information. In summary, the success of digital transformation will be based on the analysis of data flows (inside and outside the company) capable of being converted into revenue.
- Digital initiatives will be linked to a precise vision and companies will be reorganized according to this: in 2016, company decision-makers will carry out digital projects able to affect the entire organization, pursuing few but effective goals; in detail, from an organizational point of view, we will be able to see the birth of professional figures whose purpose is solely to monitor the digital transformation implementation.
- The Internet of Things will be a strong driver for digital transformation on every market: by 2018 there will be at least 22 billion devices operating within the ecosystem of the Internet of things, leading to a development of more than 200,000 new services; the solutions of the Internet of Things have the potential to be practically applied to all types of economic activities and to substantially change the ways in which people and consumers relate to companies and to their value chains.
- Digital Transformation will require new skills and an investment shift towards the IT sector: by 2018, 35% of IT resources will be invested in projects aimed at creating new revenue streams from the digital world and by 2020 almost 50% of the IT budget will be explicitly linked to digital transformation initiatives. The ability to intercept young talents and the capacity to hire the right people at the right time will become a major competitive differentiator. Moreover, new digital skills, such as creating apps for mobiles and design thinking, will become the “new normal” for software development.
- Artificial Intelligence (AI) will be a new driver: by 2018 at least 20% of all workers will use automated support technologies to make decisions and optimize work; Forbes again claims that by 2020, independent software, which do not respond directly to human control, will be involved in 5% of all economic transactions. Earlier this year, Mark Zuckerberg concretely showed his interest in artificial intelligence, when he declared his intention to develop a proprietary AI to assist him in managing his work.
In essence, Digital Transformation will have a lot to do with fundamental aspects concerning, on one hand, the organizational changes of the firms and companies, on the other, the technological and analytical dimension: the importance of expertise as well as of investments are crucial factors which will be addressed during the course of the year by various organizations; moreover, the increasingly high popularity of the Internet of Things, of Big Data Analysis, and gradually of artificial intelligences will deeply affect the markets, compelling companies to restructure and re-organize themselves. This is not just about expenditure and change, but also about new saving and revenue opportunities through personalized services and increasingly powerful analysis.