A significant factor of the digital transformation market is the increased need for industrial automation. Automation includes the integration of I.T. with mechanical systems. Wireless communication adoption is booming, and this technology’s penetration will accelerate in the future, driving the growth of digital transformation.
The outbreak of COVID-19 and the global lockdown restrictions have impacted capital investments and industrial activities worldwide. The global digital transformation market has experienced a mixed impact in the Q1 of 2020, following the global economic recession led by COVID-19. Because of lockdown restrictions, most companies operating in the end-user industries (mainly manufacturing, automotive) have shut down their production sites.
Barriers to transformation
The pandemic may have catalyzed digital transformation across the globe, but the continuous transformation is particularly challenging. The following are the top 3 barriers to the success of digital transformation, according to the 2020 D.T. Index:
1. Data privacy and cybersecurity concerns
The shift to remote work has led to a significant increase in cybercriminal activities that are now attacking larger numbers of home users, mainly small businesses and individuals with little or no protection from cybersecurity. Small companies are the #1 target for cybercriminals, but most enterprise cybersecurity software companies focus solely on SMBs (100-500+ person companies) or large enterprise accounts. The whole service is especially relevant after COVID-19, where many small businesses are now working from home.
Solution: Many emerging technologies and efforts will, in the future, guard companies against attack. Included are:
- Artificial Intelligence (A.I.): Software platforms for cybersecurity help detect and proactively eliminate cybersecurity attacks.
- Operation Centers for Virtual Security – Live personnel uses new advanced A.I. Platforms for detection to promptly mitigate and or eradicate cybersecurity threats.
- The growing importance of advanced cybersecurity services to protecting the home environment due to widespread IoT devices and remote work trends.
- Increased number of people being trained in cybersecurity technology and entering the workforce.
2. Lack of budget and resources
An obsession with big bang change, a focus on cost-cutting as a company driver, and failure to loop into the company are the main culprits of a derailed digital transformation. Moreover, despite the budgetary concerns triggered by the outbreak of COVID-19, global expenditure on digital transformation technologies and services have risen by 10.4% this year to $1.3 trillion, according to data researcher IDC published in May.
Sometimes, the problem is really a lack of funds, and often senior management may not be willing to reinvest the digital transformation initiatives budget. Businesses should consider whether they can’t really fund digital projects, or whether they’re just too conservative about where they put their money. Companies must adapt if the latter is the case because those who do not invest in innovation will quickly fall behind.
Solution: To overcome this, many companies consider other purchasing options, such as PC-as-a-Service (PCaaS), as part of their digital transformation strategy. PCaaS, which can cover everything from mobile devices to desktop P.C.s, is a subscription-based Opex (operational expenditure) model that often includes services like purchasing, configuring, managing, refreshing, and removing devices, which means that a company pays a monthly fee for the use of vendor equipment and additional facilities, rather than just purchasing hardware (referred to as Capex). Businesses can benefit from up-to-date technology while being able to amortize the cost of the device over time and scaling up and down depending on the need.
3. Unable to extract insights from data or information overload
Everyone can agree that the vast amount of digital data produced by business and consumer activity is a precious resource – at least theoretically. In reality, however, the ever-expanding data resource is underused. In a study, Accenture found that only 32%of the data would have tangible and observable value. Far less – 27% – the data and analytics ventures deliver observations and suggestions that are highly actionable. Without data-driven insights, digital transformation strategies are indifferent.
Solution: Today’s businesses may find themselves buffeted by a sea of digital transformational currents—but they can use this new generation of data management tools to create a reliable, data-based basis on which to move forward. See how SequoiaAT’s end-to-end, real-time data integration, and analytics solutions will help your company turn data into value.
The road ahead
Consider how the pandemic forced every business leader’s hand and made the inevitability of going digital inevitable: Those who were “planning” to adopt next-generation technology no longer had a choice, and they are now acting. Likewise, those who had no plans were pressured to spool one up quickly. As a result, half-baked plans have been put into practice, causing businesses to make mistakes in real-time and on the fly. The final result? Loss of earnings, headaches, and unexpected changes.
When we step into this second phase of digital transformation, be assured that making digital investments is no longer an option but a requirement. In 2020, the need to build an appealing, hybrid company identity—one embedded in both the physical and the virtual worlds—is critical to staying afloat today, tomorrow, and in the future.