A Year of Continued Necessity – Stemming the Tide
13 APR Written By Eric BruzekIn recent years, we have been first-hand witnesses to the adage that necessity is the mother of invention. 2023 will be another year of necessity, spurring organisations to take new capabilities to market through the use of disruptive technologies.
The COVID-19 pandemic necessitated dramatic improvements in the digital services and experiences that organisations offered, as well as the pace at which they were offered. It also necessitated the normalisation of remote working and remote collaboration.
In 2023, organisations will be faced with the combination of rising borrowing costs and costs of doing business, increased cyber threats, and increased competition. This article, which is the first of a two-part series, discusses the creative measures organisations are taking to stem the tide of these varied factors. This will be made possible through inventive uses of leading-edge, disruptive technologies.
Rising Interest AUS: 3.5 US: 4.75 percentage point increase since March 2022 [1][2]
What are disruptive technologies?
The words emerging technologies, leading-edge technologies, and disruptive technologies are commonly used words that are, oftentimes, used interchangeably. Although these words are related, they are distinct from each other.
Emerging technologies are technologies which are in the early stages of development, typically five or more years prior to their large-scale, practical breakthrough. Examples of these are Web3, quantum computing, and digital humans.
Leading-edge technologies are technologies which have recently achieved a large-scale, practical breakthrough. Typically, the initial breakthrough is through a defined set of features/uses, followed by subsequent feature breakthroughs. An example of this is cloud computing, with its various breakthroughs of infrastructure as a service (IaaS), software as a service (SaaS), and platform as a service (PaaS).
Disruptive technologies are a subset of leading-edge technologies which will fundamentally transform industries, business operations, and customer behaviour. A recent example of this is artificial intelligence (AI), with generative AI being the latest feature breakthrough.
Emerging to Leading-Edge
Stemming the Tide
A pattern has emerged in how organisations are actively stemming the tide of the varied external forces that are impacting their businesses. They are automating their operations, securing their most important digital assets, increasing their technology spend, and planning to acquire disruptive technology capabilities.
Automating
To alleviate cost pressures, organisations are automating their operations through the use of disruptive technologies. Robotic process automation (RPA), a feature breakthrough of hyperautomation, uses AI-based digital workers to automatically handle data flows across multiple applications at-scale. Working in concert with RPA, AI-based intelligent document processing (IDP) and speech recognition tools significantly reduce manual data entry and frontline customer interactions. When these technologies are combined with low code/no code (LC/NC) technology, organisations can further decrease their costs and improve their time to market by decentralising their operations.
30% is the average process time savings for each AI-enabled initiative implemented [3]
Identifying where and how much to automate, what functions can be decentralised, and a thin but effective central governance structure, are keys to success for organisations pursuing automation programs.
Securing
Organisations are putting more emphasis on securing their most important digital assets, due to increased cyber threats. Disruptive technologies play a critical role in organisations’ cyber playbooks. AI-based vulnerability prioritisation technologies (VPTs) are being used to detect millions of cyber vulnerabilities and prioritise those with the greatest risk. The cloud is being used as a ‘virtual booster shot’, protecting organisations from cyber virus adaptations. Organisations are also leveraging the latest encryption technologies to protect their critical data.
Cyber Investment Acceleration Cybersecurity is the top area of increased enterprise technology investment [4]
Organisations achieving the highest levels of security have a strong understanding of what technology they possess, who that technology communicates with, and what information that technology communicates.
Spending
The macroeconomic downturn has resulted in a fierce battle to retain and acquire customers. As a result, organisations are responding by increasing their technology spend. Large businesses are materially increasing their spend on digital transformation in 2023, with investments in automation, cyber security, and cloud computing (workloads, storage, networking) taking centre-stage. Global communication service providers (CSPs) are deploying fibre and 5G networks at a scale not seen over the past 10 years.
55% of APAC organisations have increased their IT budgets in 2023 [5]
Identifying segmented customer needs (features, engagement models, etc.), as well as how disruptive technologies can be strategically deployed, have been critical to the investment success of recently pursued programs.
Acquiring
With the combination of increasing market pressure and a buyer-friendly valuation environment, M&A activity is poised to surge in the back-half of 2023. M&A is still the fastest way for organisations to transform their businesses and remain relevant. A common theme for all organisations is to increase the velocity of the digital transformations which underpin their strategic objectives. Acquisitions in machine learning and artificial intelligence will be of strategic interest. Organisations desire to move AI from the fringes to the core of their business processes, to enable advanced business insight and point-in-time business-specific data curation.
M&A Acceleration M&A deal-making is likely to accelerate in the second half of 2023 [6]
Identifying the growth opportunity, understanding competitors’ plans, evaluating the technology and security of the target, and being precise on the degree and pace of integration are keys to successful investment outcomes.
Sources
[1] Trading Economics
[2] Bankrate
[3] CSIRO
[4] Gartner
[5] Computer Weekly
[6] Morgan Stanley