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Dell Technologies: Digital Trends Take a Toll on Businesses

Complex technology

Lynn HaberThe term “digital disruption” holds a lot of weight.

More than half of respondents in a survey recently commissioned by Dell Technologies report experiencing significant disruption in their industry as a result of digital technologies in the last three years. Forty-five percent of respondents agreed that the impact of digital disruption could result in their company becoming obsolete in three to five years.

The biggest threat to businesses seems to come from digital startups. About four in five (78 percent) respondents said that digital startups pose a threat to their organization either now or in the future. Of these respondents, nearly half (48 percent said their fear stems from the early adopters of machine technologies who’ll gain advantage over recruiting human labor. The other top three answers that garnered a 40 percent response or more: Fear is based on these startups being more agile and unencumbered by legacy technology and a traditional business culture (41 percent); more access to seed/VC funding which allows digital business to act quickly (40 percent); and, they’re run by millennials who have grown up with digital technology (40 percent).{ad}

The study, done by Vanson Bourne research, had 4,000 participants, i.e. business executives in midsize to larger enterprise organizations, in 12 industries across 16 countries in three regions – Americas, APJ and EMEA. The industries include: automotive, financial services, public health care, private health care, technology and telecoms, insurance, life sciences, manufacturing, media and entertainment, oil and gas, and retail and consumer.

Fear in the face of digital transformation isn’t paralyzing all organizations. Survey respondents are taking steps to counter the threat. Looking at the top five responses: Forty-seven percent have an obsessive focus on customer engagement and satisfaction; 42 percent are constantly growing their software development teams and capabilities; 39 percent have embedded digital across the organization; 37 percent have mobile and social-media technologies at the heart of their businesses, and 36 percent said they secured buy-in from management who appreciate the value of digital technologies.

It’s no wonder why almost half (47 percent) of respondents are doubling down on customer engagement and satisfaction; customers (56 percent) are the main influencers driving digital transformation.

What this actually means as to how companies are going digital: Forty-six percent of companies are integrating digital goals into departmental and staff objectives, while 51 percent of businesses are using digital technologies to accelerate product/service development.

That all sounds great until …

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… only one in four (26 percent) respondents say that their organization has fully invested in IT cloud infrastructure, data storage (26 percent) or data analytics (22 percent).

When asked about their company’s investment plans over the next one to three years, the top investment areas are: converged infrastructure (44 percent), ultra high performance compute technologies (42 percent) and analytics/big data and processing (41 percent). Moderate investment areas: Internet of Things (IoT) (39 percent), next-gen mobile apps (38 percent), technology to bring apps into the cloud for public or private access (33 percent), capabilities for application acceleration (32 percent), and artificial intelligence (30 percent).

Dell Technologies’ Digital Transformation Index supplements the research and rates companies based on respondents’ perceived performance about their firms’ digital transformation. According to the benchmark, only one in 20 (5 percent) businesses has catapulted itself into the Digital Leaders group; almost half are lagging behind.

  1. Digital Leaders: 5% – digital transformation, in its various forms, is ingrained in the DNA of the business.
  2. Digital Adopters: 14% – have a mature digital plan, investments and innovations in place.
  3. Digital Evaluators: 34% – cautiously and gradually embracing digital transformation, planning and investing for the future.
  4. Digital Followers: 32% – very few digital investments; tentatively starting to plan for the future.
  5. Digital Laggards: 15% – do not have a digital plan, limited initiatives and investments in place.

Finally, when asked about digital maturity (by vertical) based on an average score out of 100, the scores ranked from 46 for telecommunications to 37 – at the bottom – for public health care.


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