The COVID-19 pandemic has drastically changed the way businesses operate, with digital transformation being one of the most prominent shifts. Recent research has revealed that before the pandemic, only half of businesses were looking at digitalising their operations, but now that figure stands at 80%, with many organisations recognising the need to accelerate digital transformation as a strategic priority.
It is anticipated that expenditure on digital transformation technology and services will grow by 10.4 percent globally, reaching 1.3 trillion US dollars by 2023. This is unsurprising given the need for businesses to rapidly digitise their processes and update their infrastructure in light of the stay-at-home orders, in order to meet the requirements of their target audiences. Despite the need for many firms to reduce their spending in order to remain viable, it appears that digital transformation will remain a priority.
The COVID-19 pandemic has undeniably marked the start of a new era of digital acceleration. The idea of digital acceleration has been around for a while, but the global financial crisis highlighted the urgent need for companies to embrace digital transformation. It is now essential that organisations prioritise digital transformation in order to remain competitive.
Consequently, in the modern context, digital acceleration is more pertinent, given its emphasis on the necessity of quickly growing businesses’ digital frameworks. It is important not to misidentify digital acceleration for a digital transformation accelerated. The integration of new digital technologies also needs to be addressed differently for digital acceleration to be accomplished.
Getting Rid of the Outdated Method
If we take “digital acceleration” to mean a rapid digital transformation, then this would require a quick upgrade or replacement of intricate systems and infrastructures. While this would be ideal, it is not feasible.
Replacing legacy systems often requires designing new solutions from the ground up, which can take an extended period of time depending on the complexity of the system. Upgrading existing resources is equally intricate, and the fast-paced nature of the corporate world today can lead to developers working too quickly with outdated technology, increasing the risk of errors and other issues.
Businesses are increasingly recognising that simply upgrading their core technology is no longer sufficient to achieve successful digital transformation. This necessitates a change from traditional practices, as a more gradual approach to digital transition is required to avoid disruption. To power a genuine digital acceleration, leveraging data is key.
Utilizing Information Gathered From Past Experience
This paper from BCG provides a compelling argument for why the new strategy should separate the digital business transformation from the core IT transformation. The concept is to divide the digital acceleration process into two distinct changes. The first change would involve the more traditional practice of modernising core systems and enhancing the digital infrastructure with increased resources. On the other hand, a new data layer could be employed to provide the necessary agility and appropriate insights to rapidly bring value to the organisation.
By segregating these two aspects, a corporation can prioritise modernising their essential technology while still deriving value from their existing data. This raises the query: how can the data be useful if the underlying systems are not modernised and, indeed, hinder its appropriate use? The answer is simple: establish a cloud-based system architecture.
Companies may take advantage of the latest technologies, such as AI-powered algorithms and big data analysis tools, by utilising cloud-based platforms which are currently available. This solution is ideal for a digital acceleration process due to its speed, agility, security, and scalability, allowing businesses to rapidly respond to changing market conditions while providing early value to their customers.
There is a wide range of advantages to adopting a data-driven strategy, but the following stand out:
- This technology enables businesses to quickly gain insight from large datasets, utilizing existing technologies and saving on the cost and time associated with rushed IT infrastructure upgrades. This provides companies with the opportunity to plan and execute an upgrade at their own pace, without compromising customer expectations.
- By fostering a more conducive environment for creativity, engineers can innovate the company’s products, increase their potential value, and rapidly develop new digital services for internal and external usage without the need to wait for an upgrade of the main systems. This approach promotes the development of multiple projects in parallel, enabling even the less experienced members of the team to quickly catch up.
Quick Innovation Is the Key to Digital Acceleration
This perspective is markedly different to the usual way in which businesses consider digital transformation initiatives. Nevertheless, it is essential. Digital acceleration is distinct from digital transformation; it is more focused on the introduction of new ideas. It is easy to concentrate on the advantages that digital infrastructure can bring to the process, but it is important to remember that different approaches are required.
Due to the insights gathered from the challenging year of 2023, it is clear that the aforementioned statement is correct. The pandemic has highlighted the need for businesses to be able to adapt quickly to changing consumer demands and requirements. In order to remain successful and thrive during and after the pandemic, companies must undertake a comprehensive digital transformation, which will ensure they possess the necessary tools and mentality to rapidly innovate in response to the new challenges.
In the current climate, it is essential to embrace innovation if businesses are to remain competitive and create long-term value. To achieve this, companies must upgrade their core technology, but also recognise the need for a short-term digital acceleration process that can facilitate the decoupling of these processes.