As we move into the next decade, the role of technology to transform businesses will continue to expand exponentially. In 2019 alone, organizations globally spent $1.2 trillion on digital transformation initiatives. IDC’s research shows that this continues to grow at close to 20% year on year.
Every industry is being disrupted, and all organizations are looking to create a business model that is platform-enabled and ecosystem-centric.
But only 19% of organizations are generating net new revenue streams from digital investments. We call these organizations the “digital moneymakers.”
Below are the five tech trends that are shaping the focus for digital moneymakers in 2020 and beyond:
- They leverage the multiplier effect that platforms have on business value. A full 82% of revenues derived from digital business models will be platform-enabled, as they enable the seamless flow of data across every element of the value chain. IDC believes that the anchor-point to deliver business value from technology investments in the future will shift from applications (which encouraged data fragmentation) to platforms (which will enable a more seamless flow of data across internal and external environments).
- They focus on data monetization. We believe that by the end of this year, 80% of enterprises will create data management and monetization capabilities, enhancing enterprise functions, strengthening competitiveness, and creating new sources of revenue.
- The moneymakers also bring their innovation labs into the business to create innovation factories that enable the accelerated delivery of new software capabilities at scale. From 2018 to 2023, IDC predicts that 500 million new apps will be created – equal to the number built over the past 40 years. This is what we call the app explosion, and it’s leading to an unprecedented integration challenge that only next-generation platform architectures can start to solve.
- Not only do they drive innovation at the edge, they aggressively modernize their core IT leveraging the cloud. Most (65%) organizations will aggressively modernize legacy systems with extensive new technology platform investments through 2023.
- Finally, they define a technology leadership strategy that consolidates pockets of expertise. By 2023, 30% of organizations will define a new technology leadership role combining CIO, CTO, chief digital officer, chief data officer, and chief innovation officer functions.
IDC believes that a new technology architecture will be critical for an organization’s ability to deliver business outcomes from its digital investments, and that over the next decade, 75% of organizations will be digitally transformed, with the rest falling out of business. The anchor-point to deliver business value will shift from applications (which encourage data fragmentation) to platforms (which will enable a more seamless flow of data across internal and external environments).
The difference between the winners and losers will depend on an organization’s ability to build out a data-driven, platform-enabled, and ecosystem-centric business model. Winning this 10-year race to become a digital business requires a new way of thinking, acting, measuring, and reporting success. The outcome will be a shift from traditional, linear value chains toward a model in which all ecosystem interactions are part of a continuous feedback loop underpinned by a platform that enables the seamless flow of data across every person and organization in the value chain.
This platform is a flexible application infrastructure architecture that enables the orchestration and automation of end-to-end business processes and creates a launchpad for business innovation capabilities.
How to make this happen and succeed in this fast-paced and technologically dependent market? Read IDC’s White Paper “The Top 5 Tech Trends to Deliver Business Outcomes in 2020: Understanding the Power of the Platform.”