The world is awash with digital transformation excitement.
Digital is happening around us all day, every day, in the way we work, socialise, learn, purchase goods, entertain ourselves, live in our cities and receive treatment by the health service. And in large or small ways, digital is changing, augmenting or transforming the way things are done in every industry.
Some of those digital things delight us and we adopt them with speed and passion and never look back. And many of those digital things are foisted upon us and take a while for us to accept or enjoy our lives being digitised for us.
In digital the spending between business innovation and digital platforms is balanced
According to International Data Corporation (IDC), global DX (Digital) spending will reach $1.18trillion in 2019, an increase of 17.9% over 2018. Over the next four years, an additional $4trillion will be spent by organisations on digital initiatives that they hope will give them a competitive edge or, in the case of government, better serve the needs of their population.
So, with just over £5trillion of investment in the next few years, where is all that money going? IDC’s research paints a picture of the business and the CIO having shared responsibility to use this growing pot of money to drive digital transformation.
What’s getting the businesses investment? Spending in autonomous operations ($52billion), robotic manufacturing ($45billion), freight management ($41billion) and root cause technologies ($35billion) show that digital investments are systemically changing industries. Boards are clearly realising the potential of making the world a smarter, more efficient, more productive and more reliable place.
But, according to IDC, it’s the CIO who is being given the lion’s share of this investment pile, building and operating the underlying infrastructure that digital businesses will now rely on.
In fact, hardware and digital services to develop, integrate, and support digital will grab 75% of all digital spend in 2019.
Connectivity ($102billion), IT Services ($154billion) take 25% of all spending, and enterprise hardware from cloud infrastructure to enterprise servers, storage, and end devices will devour $253billion between them.
Adaptable and progressive – innovation will power the best digital platforms
If one thing jumps out at me from the IDC survey it is that the stuff being invested in by the business sounds a lot cooler than the connectivity, IT services and hardware that the CIO is building to support new digital business models. It feels big on ideas and big on business impact. It feels full of AI and machine learning, autonomous and automation. If you pardon an old man trying to sound cool – it sounds dope.
If the business stuff sounds transformational; the IT stuff sounds transactional.
But, while the names for the near 75% of digital foundations purchased by IT sound the same as they ever were (we have been buying connectivity and servers for decades), the new generation of platforms that will support digital initiatives are just as progressive as the autonomous, AI, predicative, smart machines and things that will rely on them.
Today’s networking engineer must be as familiar with automation as their autonomous factory colleague. Today’s data centre server specialist must be adept at automating the provision of applications and their container services to any location as their AI enabled supply chain colleagues. Today’s security specialist will be using more AI to secure their business than their colleagues developing the next intelligent health screening system.
And of course, in a world where DevOps is creating a flood of new digital applications, your networking, data centre, cloud or security engineer of the future will also be disruptive developers.
Cisco, the company that connected the world through the internet, has over 600,000 members of their development community DevNet; pushing the potential of digital platforms as much as any Apple or Android games developer community ever has on those funkier platforms.
And while IDC classifies lots of spending in hardware, today there is really no such thing as a hardware driven IT strategy. The network switch, the physical server, the security appliance, are now hosts for software that is transforming once static IT hardware into a new generation of highly adaptable digital platforms.
We live in a world of Software Defined, where digital platforms can be integrated, automated, developed and adapted to the exact requirements of every part of the digital business model. And of course, in the digital world it is crucial that they can.
If 75% of the investment companies are making into digital business models is being directed at the underpinning digital platforms, the pressure is on those platforms to support transformation over time. In the old world, big technology platforms support static business models, and were complicated and slow to change. In the digital world, in the application world, agile is everything.
That $800billion of investment must provide a perfect digital service in a changing world, from the first sensor or robot installed in the autonomous factory, or connected asset, or intelligent building to the last. There is no room for the status quo in the digital world; change is a given.
So, CIO’s will use their money wisely and become the hotbed for progressive digital platforms that will ensure that £1.18trillion delivers maximum economic return for the organisations and the society that will be transformed not overnight, but over time.