The urgency for digitization is nothing new; it was well known that it was a sink-or-swim initiative even way back in the unautomated age. But what was urgent then is unforgivably critical now—with AI now infiltrated in every aspect of business, and technology as a whole evolving at a galloping pace, the digital clarion call can no longer be unheeded. A new set of FutureScape digital-business predictions for 2024 from biztech and market intelligence giant IDC serve to amplify the urgency.
For years, digital transformation has been the focus for organizations looking to gain competitive advantages and modernize their processes and technology, with the goal of becoming digital businesses where value creation is based on the use of technologies for processes, products, services, and experiences. Now that the digital business era has fully arrived, companies are seeking new digital revenue streams while digitizing operations to reduce costs and increase efficiency. Spending on digital technologies is growing while traditional, non-digital spending is stagnating or even declining. And demand for digital experiences from customers, employees, partners, and suppliers has become a full-on dealbreaker..
“Digital transformation was only the first step—to truly gain value from change, companies need to move to an innovative state,” said Craig Powers, research director, Worldwide Digital Business Strategies at IDC, in a news release. “IDC expects more companies to improve their innovation capabilities through 2024 because digital innovation—the process of ideating and testing new digital technologies—is increasingly prioritized. The time for companies to build up innovative capabilities and cultures of innovation is now if they want to stay competitive in the digital business era.”
The research focuses on the external drivers that will alter the global business ecosystem over the next 12 to 24 months and the issues technology and IT teams will face as they define, build, and govern the technologies required to thrive in a digital-first world.
IDC’s top ten predictions for digital business strategies in 2024 and beyond include the following:
1) GenAI will be used to innovate
GenAI will be used to co-develop digital products and services by pinpointing market opportunities and allocating company resources. The companies that utilize GenAI in this way will more efficiently and effectively roll out new revenue-generating endeavors, leading to faster-paced growth that their competitors not using GenAI will struggle to match.
2) The pace of investments in digital technologies will continue
Spending on digital technology by organizations will grow seven times faster than the overall economy in 2024, as companies are compelled by market demands to grow digital business models and strengthen digital capabilities.
3) Elevating AI to the C-suite
Another recent IDC survey found that just over half of CIOs say their organization has or plans to have an individual leader responsible for AI, and approximately half of those CIOs believe the leader will be part of the C-suite executive team.
4) Digital-native businesses will embrace GenAI
Digital-native businesses rely on technology to support their disruptive business models and to create their competitive edge. These companies will be early adopters of GenAI and will invest heavily to further their competitive advantage.
5) Digital business platforms enable success
Digital business platforms enable greater visibility into a company’s operations, allowing for greater insight into the impacts of their investments. As businesses mature digitally, they find measuring ROI to be more straightforward and they are more likely to build leading-edge capabilities that can drive successful digital revenue initiatives.
6) AI everywhere will supercharge new digital business models
The researchers expect that the combination of predictive AI, machine vision, and GenAI capabilities, and the provisioning of on-demand services through digital ecosystems, will take on a new dimension. This will open opportunities to create new products and services for customer segments that will appreciate the appeal of these capabilities.
7) Measuring success will require new KPIs
Tracking what is truly relevant to the business is critical for strategic decision making. We expect to see new key performance indicators (KPIs) implemented that reflect a shift toward the creation and delivery of digital products, services, and experiences, which are the defining attributes of a digital business.
8) Digital-first becomes the investment priority
CEOs increasingly expect their organization’s technology leader to be focused on delivering better business outcomes, increasing business agility, and bringing in new revenue through digital products, services, and experiences.
9) AI will impact workflows and drive employee retraining
The wholesale adoption of AI will bring challenges for employees who see their overall workflow and learning process impacted. To mitigate negative impact and drive adoption, employees will need to be reskilled to work alongside GenAI.
10) Digital technologies will be used to meet sustainability goals
To achieve their sustainability ambitions, organizations will require both business and IT leaders to pursue digital technology investments that are twofold: meeting their digital goals while taking sustainability into account.
“Investment in digital business, augmented by GenAI, will continue to drive new models and positive outcomes going forward. Those organizations that have already begun their digital business journeys have seen the value and will continue to invest and innovate. Those that have delayed are at risk of losing significant market share over the next five years,” Powers added.
IDC is hosting FutureScape webinars focusing on these 2024 predictions. Get more information and register here.