IDC

IDC Digital
Transformation
Forum 2016

The world is changing! Harness the power of digital transformation to propel your business forward.

No one will need more than 637KB of memory for a personal computer. 640KB ought to be enough for anybody.
Bill Gates
Founder and Chairman of Microsoft
A rocket will never be able to leave the Earth’s atmosphere.
New York Times
1936
There's no chance that the iPhone is going to get any significant market share. No chance.
Steve Ballmer
Microsoft CEO, 2007
I think there is a world market for maybe five computers.
Thomas Watson
Chairman and CEO of IBM, 1943

What Is Digital
Transformation

Organizations have started using digital technologies in ways they have never anticipated. Innovations driven by digital technologies are expected to bring about unprecedented business transformation, representing the biggest industry shakeout since the Industrial Revolution.

The 3rd Platform technologies of cloud, big data, mobility, social media, and the Internet of Things are driving enterprises to the next level of digital customer engagements and IT-enabled business processes, products, and services.

IDC Digital Transformation, YOU ARE AT RISK!

IDC Digital Transformation, YOU ARE AT RISK!

How to Measure
and Benchmark
Your Digital
Maturity

Digital transformation is not a BYOD strategy, DevOps tactics, a social media campaign, a cloud- or mobile-first approach or an IT/business alignment project. It is a continuous business change and cultural shift towards digital competencies with a view towards innovation. IDC’s Digital Transformation MaturityScape framework suggests that the transformation requires a multi-faceted approach covering five critical areas: leadership transformation, omni-experience transformation, information transformation, operating model transformation, and workforce transformation. The IDC framework also describes five stages of maturity that a business can achieve.

Select A - DX Maturity Stages

Ad-hoc Overall Maturity

DESCRIPTION:

Management goals for DX are poorly defined and occasionally chaotic. Success often depends on individual effort, and benefits are not widely shared within the business.

BUSINESS OUTCOME:

Business and IT digital initiatives are disconnected and poorly aligned with enterprise strategy and not focused on customer experiences.

DESCRIPTION:

Leadership is unaware of or skeptical about digital transformation and provides little or no guidance or vision for DX. Ecosystem influence is limited to customers and competitors. Digital transformation is limited to isolated projects, driven by perceived competitive threats to the business and occasional demands from customers and partners.

BUSINESS OUTCOME:

Ad hoc leadership is status quo driven and focused on business as usual. Leaders prefer to wait and see, trading short-term capital risk for the longer-term but less-certain risk of having to race to catch up with their peers or being without any defense against disruptive DX innovators in their industry.

DESCRIPTION:

The enterprise has little to no ability to adapt business models, products, and services to create contextualized and individuated ecosystem experiences, but pilots enable the business to evaluate the business case for specific scenarios.

BUSINESS OUTCOME:

Companies lose business opportunities because of their inability to engage and keep pace with the ecosystem needs and requirements. They make few attempts to deliver an omni-experience to any of their stakeholders, and the resulting negative experience adversely affects the broader business performance.

DESCRIPTION:

Operational systems run multiple instances. Data quality problems combined with integration and compatibility issues enable only limited localized business digitalization. Structured data is primarily presented in predefined reports, and unstructured data is left unexploited. Data security is unknown or guided by a no-risk approach.

BUSINESS OUTCOME:

This results in limited localized business digitalization.

DESCRIPTION:

Information and operations tech groups are fragmented and uncoordinated. There are no evident connections to assets, processes, or products.

BUSINESS OUTCOME:

The overall organizational resistance to the digital transformation of the operating model leaves the organization highly vulnerable to competitive forces.

DESCRIPTION:

WorkSource traditionalists generally view talent management as unimportant and maintain a "personnel" mindset. Traditionalists have a bias toward full onsite employment, eschewing remote workers and contingent or freelance workers. Desktop-, Web-, and paper-based business processes are leveraged exclusively. And the culture consistently honors the founder's vision without adapting it to current conditions or market opportunities.

BUSINESS OUTCOME:

Traditionalists have no visibility into talent issues, gaps, or opportunities. Sourcing new talent is slow and the cost of hire is generally high for most significant positions. While individuals and small teams may be highly productive, WorkSource traditionalists do not support the use of tools to facilitate larger, more collaborative processes and projects.

DESCRIPTION:

Basic capabilities are established. The necessary disciplines for DX are in place to repeat earlier successes on similar initiatives. The business somewhat lags behind best-performing peers.

BUSINESS OUTCOME:

Business has identified a need to develop digitally enhanced customer business strategies, but execution is on an isolated project basis, and progress is neither predictable nor repeatable.

DESCRIPTION:

Leaders allow limited-scope DX initiatives but are unable to "connect the dots" to scale and broaden the impact of DX initiatives. DX initiatives spring from LOBs and focus on using digital technologies to solve specific customer needs and opportunities.

BUSINESS OUTCOME:

Opportunistic companies assess DX initiatives on a case-by-case basis for value versus the cost of doing nothing. Leadership has yet to envision the relationship of business with its ecosystem as a process that drives change or innovation. Enterprisewide DX initiatives are rare and more often focused on a specific process or function rather than being part of a broader adoption of new business competencies.

DESCRIPTION:

The enterprise is inconsistent and has narrow focus on enhancing experience as a key goal in developing products and services. The analysis and synthesis of additional sources of omniexperience data supports the pursuit of new types of interactions.

BUSINESS OUTCOME:

Companies in the opportunistic stage see inconsistent and unsustainable outcomes from efforts to deliver omni-experiences to their stakeholders across the ecosystem. These organizations deliver specific projects and initiatives around omni-experience as part of their digital transformation, but they struggle to scale that approach across the broader organization.

DESCRIPTION:

Traditional data warehouse and analytics are mainly limited to structured data. Localized business experiments with socialytics, big data, and real-time analytic processing have yet to coalesce into a coherent strategic information architecture. Data is presented through dynamic and highly interactive visualization tools. Data security is assessed.

BUSINESS OUTCOME:

Business intelligence and insights from structured data are limited.

DESCRIPTION:

Company has evidence of only isolated cases of connecting products, assets, and processes. There is some information sharing between the information and operations groups but with little active coordination.

BUSINESS OUTCOME:

Isolated experiments yield satisfactory returns, but the full potential of digital transformation cannot be reached without a more coordinated effort.

DESCRIPTION:

WorkSource opportunists manage talent in silos, providing some guidelines on how business units and lines of businesses interact. Cross-group collaboration is "case by case" with occasional success, with some groups leveraging mobile tools and other groups leveraging social collaboration tools. The enterprise management style can vary widely for WorkSource opportunists but generally achieves business objectives by focusing on the work environment and conditions.

BUSINESS OUTCOME:

WorkSource opportunists exhibit very few talent management efficiencies with no visibility into talent issues within the organization. The recruiting and sourcing function is overwhelmed by a high volume of low-quality applicants slowing evaluation and decreasing hire quality and new-hire success. Group collaboration success is sporadic with a variety of collaboration tools and processing leveraged throughout the user base. Teams and groups are internally competitive for leadership attention, resources, and even customers.

DESCRIPTION:

Business-IT goals are aligned at enterprise level to near-term strategy and include digital customer product and experience initiatives but not yet focused on the disruptive potential of digital initiatives. Capabilities are documented, standardized, and integrated at the enterprise level.

BUSINESS OUTCOME:

Digital transformation at the business level is a strategic business goal. The business maintains parity with its competitors and peers.

DESCRIPTION:

Leadership's vision for DX is enterprisewide and leverages digital technologies to maintain parity with competitors and peers. Leadership's approach to culture change is still primarily top down and hasn't yet empowered the organization to self-govern and adapt. Repeatable companies tend to make just enough of an investment in DX to stay even, either because their industry doesn't require cutting-edge innovation or because the business' leadership has not yet developed an innate sense for the impact of DX on the future of the business beyond countering competitive threats.

BUSINESS OUTCOME:

Integration, standardization, and documentation are the most common key attributes of the repeatable stage. Many repeatable businesses have established standard enterprise practices.

DESCRIPTION:

Provision of engaging in high-quality business and ecosystem experiences is a critical imperative in the creation of all new enterprise products and services. Significant cultural, business, and technological shifts lay the foundation for responsive omni-experience adaptation.

BUSINESS OUTCOME:

Companies see improved ecosystem loyalty and business performance and exhibit a consistent ability to deliver omni-experiences that drive competitive value.

DESCRIPTION:

Information architecture, including security, allows internal and external information in a variety of forms — relational or NoSQL — to be leveraged for business-critical domains, enabling instantaneous data analysis and opportunities based on better intelligence and insight.

BUSINESS OUTCOME:

Standardization and statistical programming provide insights from structured and unstructured data.

DESCRIPTION:

Centrally coordinated operations enable sharing of best practices. Initiatives to digitally connect products, assets, and processes are under way but are of limited scope.

BUSINESS OUTCOME:

Foundation is in place to support future gains, but without accelerated efforts, the organization is likely to remain at parity with the market, at best.

DESCRIPTION:

The talent management process has pockets of integration with broad acceptance of remote workers. There is some, but limited, use of mobile and social access to business applications and processes. WorkSource progressives regularly align work environment and management practices to achieve shifting business objectives.

BUSINESS OUTCOME:

WorkSource progressives see talent and recruiting processes as aligned. WorkSource progressives generally plan and execute talent processes on a predictable schedule, decreasing time-to-fill metrics, though low-quality applicants still create "noise" in the pipeline. Team capability is inhibited by limited type and penetration of collaboration tools in use. Team cooperation is high within groups when business objectives align.

DESCRIPTION:

Capabilities for DX are embedded in the enterprise and tightly linked to an agile management vision. The business leads its peers and competitors.

BUSINESS OUTCOME:

Integrated, synergistic business-IT management disciplines deliver digitally enabled product/service experiences on a continuous basis.

DESCRIPTION:

Leaders have created and embedded DX vision across the enterprise, making the business a market leader. The business has established its presence in the ecosystem to actively engage with and influence markets, customers, and partners through the use of DX technologies. Industry-leading DX is based on an organizational culture that mirrors a continuous evolution of leadership's DX vision to stay ahead of its competitors and push toward adopting the latest digital business innovations.

BUSINESS OUTCOME:

Governance has been distributed to areas of the business responsible for key products, services, and processes to enable swift response and action to ecosystem changes. Organizations at the managed level employ a variety of real-time tools, including dashboards and analytics, to maintain a continuous perspective on business performance and its external drivers and enablers.

DESCRIPTION:

The enterprise consistently delivers high-quality product and service experiences through every interaction that engages a customer, product, market, partner, or service provider. The business relies on automated analysis and synthesis of ecosystem pulses to improve business model development and product and service ideation, selection, and execution.

BUSINESS OUTCOME:

Companies exhibit an ability to continually attract and retain relationships across the ecosystem loyalty that directly drives the broader business performance.

DESCRIPTION:

Enterprise gains a competitive advantage with information and social listening, Web, and mobile big data and analytics to assess the current and future state of customers and markets to stay ahead of competition. Enterprise generates new revenue streams from data products and services.

BUSINESS OUTCOME:

Enterprise information enables competitive advantage from digital value-add and service innovation.

DESCRIPTION:

Active program management of the digital portfolio allows for implementation economies, faster cadence, and common organizational objectives. Digital initiatives cover a broad range of products, assets, and processes.

BUSINESS OUTCOME:

Enterprise is actively leading the market and exhibits the behavior of a highly anticipatory and responsive operation.

DESCRIPTION:

WorkSource transformers see talent management as the result of the "war for new talent." Transformers believe that internal development is the primary tool to source organizational leaders and critical positions. Teams have broad access to business applications and business processes through mobile and social connections. Management structures favor flexible work arrangements and management styles, which consistently achieve business objectives.

BUSINESS OUTCOME:

WorkSource transformers exhibit reduced turnover by substantially increased hire quality, the use of HR analytics, and, in some cases, pay for performance. Collaboration tools are widely leveraged by WorkSource transformers to align efforts of dispersed teams and reflect best practices for collaboration and teamwork.

DESCRIPTION:

Enterprise is aggressively disruptive in the use of new digital technologies and business models to affect markets. Ecosystem awareness and feedback is a constant input to business innovation.

BUSINESS OUTCOME:

Continuous improvement is a core business management philosophy. Leadership embraces risk taking and experimentation to develop innovative, groundbreaking capabilities.

DESCRIPTION:

Leaders employ visionary and disruptive DX based on deep ecosystem insight and influence, which drives organizational culture, goals, and projects. New business practices and models force competitors to adapt or fail. Ecosystem participants view the business and its leaders as industry defining.

BUSINESS OUTCOME:

The optimized organization is typified by visionary and inspired leadership, but it also leverages an approach to innovation that rewards experimentation, accepts failure as a stepping stone, celebrates a culture of striving, and assumes a high level of risk.

DESCRIPTION:

The enterprise exhibits an ability to repeatedly disrupt and transform market and personal behaviors by continuously innovating and delivering contextualized and individuated experiences in an engaging, consistent way. Self-improving processes generate sustainable market-leading digital experiences.

BUSINESS OUTCOME:

Companies continually and sustainably grow the business ahead of the market as a result of amplified and self-adaptive market responsiveness. These organizations continually disrupt themselves and outpace the market by understanding and responding to extended ecosystem needs and conditions to deliver optimized omni-experiences.

DESCRIPTION:

Information in multiple forms is integrated from a myriad of sources and enables real-time predictable analytics. Monetization of data from and about products, customers, and markets is a core part of the enterprise's business strategy and a significant source of revenue and competitive strength.

BUSINESS OUTCOME:

Information drives continuous business innovation, creates revenue stream, and fuels customer experience. Information also drives product and service innovation.

DESCRIPTION:

Processes, products, and assets are highly instrumented, contextually aware, and autonomic. A digital operations group supplants individual information and operations tech groups.

BUSINESS OUTCOME:

The organization is able to instantly adapt to changing circumstances with a deep cognitive understanding of the operating context that allows it to dominate markets.

DESCRIPTION:

WorkSource disruptors believe talent and talent processes represent a competitive advantage. Highquality resources are tapped through internal development, contingent, contract, or freelance channels. Business applications are ubiquitously available to remote and mobile workers, facilitating collaboration and timely communication. Organizational culture adapts to support business strategy and operating philosophy.

BUSINESS OUTCOME:

End-to-end visibility of talent and recruiting data maximizes the value of internal bench strength leveraged and key role performance. Leaders have the ability and confidence to tap both internal and external sources for high-quality talent. Ubiquitous collaboration is enabled by the availability and consistent use of the right tools for individual, team, and group collaboration. Organizational structures are strategically aligned and mutually supportive for maximum organizational benefit.

Top 10 IDC Digital
Transformation
Predictions
2016-2018

Companywide
Multiple
departments
or business units
A single department or a business units
0-12 months
12-24 months
24+ months
1
2
3
4
5
6
7
8
9
10

Note: The size of the bubble indicates complexity/cost to adress.
Source: IDC FutureScape: Worldwide Digital Transformation 2016 Predictions

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Sales Director
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+420 724 557 231

About IDC

International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a subsidiary of IDG, the world's leading technology media, research, and events company.
To learn more about IDC, please visit www.idc.com. Follow IDC on Twitter at @IDC.

1000
Analysts
51
Years
110
Countries