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Pace of digital transformation accelerates

As businesses strive to return to profitability, business leaders are relying on tech innovation to drive economic recovery

There is growing evidence that the pace of digital transformation is accelerating. New studies point to the coronavirus crisis acting as a catalyst to remove manual and inefficient processes. There is also evidence that some businesses are keen to adopt emerging technologies to rethink traditional business processes.

A global survey of 700 CIOs in large enterprises with over 1,000 employees, conducted by Vanson Bourne and commissioned by Dynatrace, found that over the past 12 months, the majority of CIOs (89%) say their digital transformation has accelerated, and 58% say it will continue to speed up.

Dell’s latest Digital Transformation Index has reported that the coronavirus pandemic is accelerating digital transformation across the globe. However, Dell found that 94% of organisations in the UK are facing entrenched barriers to transformation. Lack of budget is the main barrier preventing organisations fulfilling their digital transformation objectives.

The benchmark, based on a global survey of 4,300 business leaders, conducted in July and August of 2020 by independent research company Vanson Bourne, found that prior to the pandemic, business investments were strongly focused on foundational technologies, rather than emerging technologies.

The vast majority in the UK, 89%, recognise that as a result of disruption this year, they need a more agile and scalable IT infrastructure to allow for contingencies.

Adrian McDonald, EMEA president of Dell Technologies, said that the coronavirus pandemic has led to permanent changes in business.

“Business models that were successful before Covid-19 became fundamentally more successful after Covid,” he said. “However, companies that had challenging business models prior to Covid have experienced greater challenges.”

Digital innovation in manufacturing

Another study, from HP, which looked specifically at the opportunities to digitise manufacturing, reported that the majority of business decision makers (77%) are looking to transform their business models over the next 12 months.

The Digital manufacturing trends report from HP found that 99% of respondents believe that digital manufacturing technologies can lead to economic growth and 90% are looking to evolve their business models because of the current world business environment. HP also reported that 92% of respondents said they are investigating new production and supply chain models, with 51% localised production and hybrid models, and 42% distributed supply chain. 

In terms of the types of technologies business leaders are betting on, the Dell Digital Transformation Index reported that that 78% of UK respondents believe an increase in the use of augmented reality (AR) will accelerate the speed with which staff learn how to repair things; 81% foresee organisations using artificial intelligence (AI) and data models to predict potential disruptions, and 70% predict distributed ledgers – such as Blockchain – will make the gig economy fairer, by cutting out the intermediary.

However, Dell reported that only 10% are planning to invest in Virtual/Augmented Reality, just 28% intend to invest in AI and only 11% said they plan to invest in distributed ledgers in the next one to three years.

Read more about digital transformation

  • Yanna Winter, CIO and head of IT at insurance firm Generali, discusses how to slice up the legacy IT elephant in the room to enable data-driven applications.
  • The pandemic has shone a spotlight on the importance of joined up processes where manual intervention is kept to a minimum. In this e-guide we explore how IT spending is shifting.

The HP study found that manufacturing decision makers see opportunities for accelerated innovation with additive manufacturing and 3D printing to innovate manufacturing and product development. Almost all the decision makers who took part in the HP survey (91%) said they are looking to explore how mass customisation could be applicable to their business if parts can be personalised through additive manufacturing and 3D printing.

According to HP, the medical, industrial and automotive industries are in a strong position to innovate in additive manufacturing and 3D printing over the next five years. 

“The global manufacturing sector is clearly signaling a desire for greater supply chain resiliency, more manufacturing flexibility, increased speed of innovation, and stronger environmental sustainability,” said George Brasher, managing director for UK & Ireland at HP. “And they are seeing industrial 3D printing as a way to not only lower costs and go to market faster, but as a unique competitive advantage that accelerates innovation for customers.”

HP said that digital manufacturing technologies are driving new opportunities for collaboration in the UK. The HP survey found that 82% of decision makers indicated that their company has plans to collaborate with government entities on digital manufacturing products. 

Importance of automating IT

From an IT management perspective, analyst Forrester predicted that cloud native technology will continue to power digital transformation strategies. In its Predictions 2021: Cloud computing report, Forrester predicted that by the end of next year, 60% of companies will be using containers on public cloud platforms and 25% of developers will be making use of serverless architectures.

Digital transformation puts greater emphasis on joined up IT systems and the use of new and emerging technologies like augmented reality, the use of AI for predictive analytics and additive manufacturing. As Forrester has found, organisations are increasingly turning to the public cloud, to build cloud-native infrastructure to support new digital transformation initiatives.

Undoubtedly, IT departments are going to be asked to do more to help organisations make the best use of whatever technology can offer, to drive forward business recovery and growth opportunities.

There is a business case for embedding AI-powered automation in IT to manage the extra workload more efficiently. In fact, Dynatrace’s study reported that 93% of CIOs think AI-assistance will be critical to IT’s ability to cope with increasing workloads and deliver maximum value to the business.

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