Digital Business is Top-of-Mind

Establishing a digital business is top-of-mind, even more so than last year, as 91% of organizations have adopted or have plans to adopt a digital-first strategy, according to IDG Communications Digital Business Research.

Of these organizations, 48% already have a digital-first approach in place, up from 44% in 2018, meaning they are either in the execution, integration or digital maintenance phases.

The study also examines the strategies and technologies that businesses are adopting to ensure digital success, status of workforce transformation, and the importance of enhancing the customer experience in digital business objectives.

Status of the Digital Business Landscape

Multiple objectives are driving investment in digital business initiatives. Up from 58% in 2018, 67% of IT decision-makers (ITDMs) placed creating better customer experiences within their top five objectives for their organizations' digital transformation (DX) strategy.

Additional objectives include improved process efficiency through automation (53%), driving new revenue (48%), and staying ahead/on pace with competition (47%).

These objectives align with the factors ITDMs value in measuring the success of their digital initiatives. Topping the list is excellent customer experience as measured by customer satisfaction scores, followed by improved employee productivity through process efficiencies/automation, and increased ability to enable innovation.

Once digital business practices are established, ITDMs report positive results. More than one-third (35%) of organizations have experienced revenue growth due to digital business initiatives over the past 12 months, and on average these organizations experienced a 29% increase in revenue.

Digital business results contributing to this growth include new product and service offerings (50%), improved ability to innovate and seize new opportunities (49%), and overall new capabilities (42%).

Due to the nascent state of digital business adoption, 38% of businesses are unsure about their revenue growth; however, as this area matures the expectation is that these investments will lead to revenue growth in the future.

"This is an exciting time for businesses as technology continues to transform and support digital innovation," said Julie Ekstrom, SVP, IDG Communications, Inc. "The 2019 Digital Business Research reaffirms that the tech landscape has never been more complicated yet filled with opportunity to contribute to the business. Organizations must embrace new technologies and strategies, while ensuring a positive customer experience, in order to succeed."

Investments Supporting Digital Transformation

There is significant financial support behind digital business tools and strategies. On average, organizations will spend $15.3 million over the next 12 months on digital business initiatives, which is up from $14.3 million in 2018.

In a new question this year, IDG looked at how digital transformation budgets are divided among people and technology. The results show a fairly even split with 59% of the budget dedicated to technology, and 41% dedicated to people and skills.

This budget split aligns with the steps within the implementation process that organizations are making progress with, or have completed, to become a digital business. Out of the nine phases the research outlined, the greatest progress is among data security/protection strategy, technology needs assessment and data management strategy. However, when asked which step is the most crucial to digital business success, 53% ranked developing a business case/roadmap for overall DX strategy at the top.

The technologies that IT leaders currently have in use to help support their digital growth are mobile devices, mobile apps, private cloud, business process management, and public cloud. Exploration of new and emerging technologies include researching or piloting artificial intelligence (62%), followed by machine learning (57%), and 5G (55%).

There is also great interest in Internet of Things (IoT) as 51% of ITDMs are actively researching or piloting these solutions. Not only are these technologies being introduced to help improve the customer experience, but IT leaders are also focusing on workforce transformation – a strategy to change internal processes, departmental structures, incentives, skills, culture and/or behaviors.

37% of organizations have already implemented this strategy within their business, and 93% report that workforce productivity is dependent on technology.

Methodology: IDG's 2019 Digital Business Research was conducted among the audiences of five IDG brands (CIO, Computerworld, CSO, InfoWorld, and Network World) representing IT and security decision-makers within organizations that have plans to adopt/or already launched a "digital-first" approach. The survey was fielded online with the objective to gain a better understanding of where organizations are in their digital-first approach. Results in this release are based on 702 respondents across multiple industries.

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Digital Business is Top-of-Mind

Establishing a digital business is top-of-mind, even more so than last year, as 91% of organizations have adopted or have plans to adopt a digital-first strategy, according to IDG Communications Digital Business Research.

Of these organizations, 48% already have a digital-first approach in place, up from 44% in 2018, meaning they are either in the execution, integration or digital maintenance phases.

The study also examines the strategies and technologies that businesses are adopting to ensure digital success, status of workforce transformation, and the importance of enhancing the customer experience in digital business objectives.

Status of the Digital Business Landscape

Multiple objectives are driving investment in digital business initiatives. Up from 58% in 2018, 67% of IT decision-makers (ITDMs) placed creating better customer experiences within their top five objectives for their organizations' digital transformation (DX) strategy.

Additional objectives include improved process efficiency through automation (53%), driving new revenue (48%), and staying ahead/on pace with competition (47%).

These objectives align with the factors ITDMs value in measuring the success of their digital initiatives. Topping the list is excellent customer experience as measured by customer satisfaction scores, followed by improved employee productivity through process efficiencies/automation, and increased ability to enable innovation.

Once digital business practices are established, ITDMs report positive results. More than one-third (35%) of organizations have experienced revenue growth due to digital business initiatives over the past 12 months, and on average these organizations experienced a 29% increase in revenue.

Digital business results contributing to this growth include new product and service offerings (50%), improved ability to innovate and seize new opportunities (49%), and overall new capabilities (42%).

Due to the nascent state of digital business adoption, 38% of businesses are unsure about their revenue growth; however, as this area matures the expectation is that these investments will lead to revenue growth in the future.

"This is an exciting time for businesses as technology continues to transform and support digital innovation," said Julie Ekstrom, SVP, IDG Communications, Inc. "The 2019 Digital Business Research reaffirms that the tech landscape has never been more complicated yet filled with opportunity to contribute to the business. Organizations must embrace new technologies and strategies, while ensuring a positive customer experience, in order to succeed."

Investments Supporting Digital Transformation

There is significant financial support behind digital business tools and strategies. On average, organizations will spend $15.3 million over the next 12 months on digital business initiatives, which is up from $14.3 million in 2018.

In a new question this year, IDG looked at how digital transformation budgets are divided among people and technology. The results show a fairly even split with 59% of the budget dedicated to technology, and 41% dedicated to people and skills.

This budget split aligns with the steps within the implementation process that organizations are making progress with, or have completed, to become a digital business. Out of the nine phases the research outlined, the greatest progress is among data security/protection strategy, technology needs assessment and data management strategy. However, when asked which step is the most crucial to digital business success, 53% ranked developing a business case/roadmap for overall DX strategy at the top.

The technologies that IT leaders currently have in use to help support their digital growth are mobile devices, mobile apps, private cloud, business process management, and public cloud. Exploration of new and emerging technologies include researching or piloting artificial intelligence (62%), followed by machine learning (57%), and 5G (55%).

There is also great interest in Internet of Things (IoT) as 51% of ITDMs are actively researching or piloting these solutions. Not only are these technologies being introduced to help improve the customer experience, but IT leaders are also focusing on workforce transformation – a strategy to change internal processes, departmental structures, incentives, skills, culture and/or behaviors.

37% of organizations have already implemented this strategy within their business, and 93% report that workforce productivity is dependent on technology.

Methodology: IDG's 2019 Digital Business Research was conducted among the audiences of five IDG brands (CIO, Computerworld, CSO, InfoWorld, and Network World) representing IT and security decision-makers within organizations that have plans to adopt/or already launched a "digital-first" approach. The survey was fielded online with the objective to gain a better understanding of where organizations are in their digital-first approach. Results in this release are based on 702 respondents across multiple industries.

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AI Requires Design, Not Edicts

Many organizations describe AI as strategic, but they do not manage it strategically. When AI plans are disconnected from strategy, detached from organizational learning, and protected from serious assumptions testing, the problem is no longer technical immaturity; it is a failure of management discipline ... Executives too often tell organizations to "use AI" before they define what AI is supposed to change. The problem deepens in organizations where strategy isn't well articulated in the first place ...

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