By the end of 2017, about 60 percent of top 1000 enterprises in Asia Pacific region will have digital transformation at the centre of their corporate strategy, with majority even creating an independent position to oversee the DX strategy implementation, according to market research firm IDC. 

 

“In 2016, we will witness the mega transition in the DX(Digital Transformation) era. Enterprises will “flip the switch”, committing to a massive new scale of DX and Third Platform technologies in order to stake out leadership positions in the hyper-digital economy”, said Sandra Ng, Group Vice President, Practice, IDC Asia/Pacific.

Third platform technologies are becoming pervasive. It is imperative for any business, across industries, to take cognizance of these. They are creating new possibilities for transformation, and efficiencies.

“They (third platform technologies) are breaking down barriers to entry and new competitors can come from unexpected quarters: so, a bank needs to worry about a Telco taking away its payments business. Even the local kirana shop owner needs to worry about the impact of hyper-local delivery services!” said Jaideep Mehta, Managing Director, IDC South Asia.

IDC predicts that the following trends would drive the IT landscape in 2017 in the APAC region:

#1: CEO-led strategy in DX.  By the end of 2017, 60% of the APAC top 1000 (A1000) enterprises will have digital transformation (DX) at the centre of their corporate strategy.

#2: Dedicated DX executive. By 2017, 60% of companies with a DX strategy will deem it too critical for any one functional area and create an independent corporate executive position to oversee the implementation. 

#3: 3rd platform IT. By 2017, over 60% of organizations' ICT spending will be for 3rd platform technologies, solutions and services, rising to nearly 80% by 2020.

#4: Customer/intimacy at scale. By 2018, 80% of B2C and 60% of B2B organizations will overhaul their “digital front door” to support 1,000 to 10,000 times as many customers/customer touchpoints as they do today.

#5: Leading in 3D. Through 2018, two-thirds of CIOs will have embraced “Leading in 3D”, which requires them to simultaneously innovate, integrate, and incorporate.

#6: DX collaboration. By 2018, 70% of silo-ed digital transformation initiatives will ultimately fail due to insufficient collaboration, integration, sourcing or project management.

#7: Innovation capacity. By 2020, enterprises pursuing DX strategies will more than double their software development capabilities; two-thirds of their coders will focus on strategic DX apps and services.

#8: New digital revenue streams. By 2018, 35% of IT resources will be spent to support the creation of new digital revenue streams.

 

#9: Security and risk management. By 2016, 40% of IT organizations will shift their focus to advanced 'contain and control' security and away from a perimeter mentality.

 

#10: Data governance for insights. By 2017, two-thirds of Asian-based CIOs will initiate a data transformation and governance framework to turn information into a competitive business differentiator.

“The digitalization of nations, economies, industry ecosystems and enterprises are pushing new competitive benchmarks in areas of business process excellence and new monetization/business models. The new hyper-digital era presents opportunities and competition/challenges that go beyond geographic and industry boundaries. This is where scale becomes the competitive ingredient for the digital enterprise”, added Sandra Ng.

“Third platform technologies are becoming pervasive. It is imperative for any business, across industries, to take cognizance of these. They are creating new possibilities for transformation, and efficiencies.”

IDC predicts that digital transformation will drastically change the IT industry. In fact by 2020, more than 30% of the IT vendors will not exist as we know them today, requiring realignment of preferred vendor relationships.

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