Business Leadership & Strategy

3 Things Your Organization Needs in the Digital Economy

Digital Economy Preparation
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While today’s business environment is already digitally-powered, new technology advances are poised to deliver a radically new system of commerce. In fact, IDC predicts that by 2020, 50% of the Global 2000 will see much of their business depend on their ability to create digitally-enhanced products, services, and experiences. This expansion of Digital Transformation (DX) at a global scale signals a new digital economy.

In the digital economy, innovation and adaptability are table stakes, instead of differentiators. DX isn’t just a new initiative for enterprises to test out; instead, it becomes a critical part of the overall business strategy. Businesses only succeed when they demonstrate that they can adapt to the changing market and become true “digital natives”. Digital natives instill the right behaviors in employees and executives, and empower them with the right tools to deliver more impressive experiences to customers.

So how should enterprise organizations approach the process of becoming digitally native? There are three things that all digitally native companies invest in. Check on how your business prioritizes these items, and adjust accordingly to set your organization up for success in the digital economy:

A DX Strategy That Drives Towards Five Levels of DX Mastery

At its core, Digital Transformation is a customer-centric business strategy. In order to improve decision making and deliver enhanced experiences to customers, businesses need to build a strong DX foundation out of DX strategy and implementation, 3rd Platform technology, and IT leadership. The right DX strategy will help drive an organization forward to accomplishing five discrete levels of Digital Transformation:

  • Leadership Mastery: Fostering digital native status from DX-minded leaders.
  • Relationship Mastery: Creating a customer-centric business model.
  • Information Mastery: Successfully capturing, examining, and disseminating information at an efficient scale across the business.
  • Operational Mastery: Achieving scale, expanding scope and delivering at a high rate of speed.
  • Talent Mastery: Creating and sustaining an innovative culture that optimizes work and talent.

Mastering each of these levels propels an organization into digital native status, positioning the business for greater success in the digital economy.

The Right Mix of 3rd Platform Technologies

The right technologies foster growth and leadership opportunities, which are critical to building digitally native enterprises. IDC considers the 4 Pillar Technologies essential for businesses navigating the digital economy. These four technologies will continue to dramatically expand capabilities:

  • Big Data & Analytics
  • Cloud, particularly whole cloud
  • Mobility
  • Social

Innovation Accelerators, as defined by IDC, are the next wave of 3rd Platform technologies critical to business transformation. Capturing growth in the rapidly scaling digital marketplace will require that offerings focus on these key growth drivers:

  • Cognitive/Artificial Intelligence (AI)
  • The Internet of Things (IoT)
  • Next Generation Security
  • Robotics [link to Robotics blog post]
  • Augmented and Virtual Reality (AR/VR)
  • 3D Printing

While each of these technologies has the potential to drastically affect am organization, the real transformative power comes from the ways in which digital natives combine these disparate technologies into DX-minded solutions. Digital mashups, which are combinations of two or more 3rd Platform technologies, aim to deliver new digital experiences and products.

DX-Minded Business Leaders

It takes vision, knowledge, and strategy to know which tools to deploy and in what ways to create the right environment for an enterprise. That’s why strong IT leadership is so crucial to success in the digital economy. In 2019, enterprises worldwide will spend $2.1 trillion on technology and related services to implement and manage Digital Transformation initiatives; there is enormous opportunity in the space, but there is also a large amount of risk. Knowing how to elevate current initiatives and move them forward will be key to creating and executing a Digital Transformation strategy.

In the new digital economy, successful business leaders will need to understand how to combine technologies and apply them to strategy to maximize value for their organization. IT and business leadership will need to closely examine where their businesses are, and where they want them to be, in order to create the right combination of resources to drive Digital Transformation – and ultimately, business success.

Want to learn more about the digital economy and how it will affect business? Download IDC’s interactive ebook, “Preparing for the Digital Transformation Economy: The Tools Needed to Build a Digitally Native Enterprise” to explore how organizations are approaching DX. Prepare your business to become a true digital native.

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