Worldwide spending on the technologies and services enabling digital transformation (DX) of business practices, products and organizations is forecast to reach $2.3 trillion in 2023. [IDC] The pandemic with its accompanying mandated lockdowns and shift to remote workforces along with changes in customer and market demands have forced companies to accelerate digital transformation.
What is digital transformation?
Digital transformation is the process of using digital technologies to create new — or modify existing — business processes, culture and customer experiences to meet changing business and market requirements.
For some, this might mean replacing non-digital or manual processes with digital processes or converting business processes and technology to a modern, cloud-first architecture. Digital transformation leverages the Internet and latest technologies like mobile, cloud, AI, sensors and analytics to solve problems or make processes seamless.
Digital transformation is taking place across all industries, with organizations in various stages of maturity. Some examples include:
- Manufacturers can quickly improve their operational efficiency using automated assistance technologies such as 3D printing, robotics, AI, augmented reality and virtual reality. These technologies enable manufacturers to produce higher-quality goods on a larger scale, condense production timelines and streamline the supply chain to serve customers better.
- In healthcare, digital technologies are enabling telehealth to reach rural, remote and high-risk patients to interact with doctors and healthcare professionals through virtual appointments. Hospitals use AI-enabled medical devices and blockchain electronic health records to share data, track patients and understand their experiences, helping to reduce readmission rates. Providers and health associates aggregate massive amounts of data to provide insights into delivering better treatment plans and health outcomes.
- The construction industry building “smart cities” are using SaaS to gain more efficiency in the construction processes and reduce operational costs. Internet of Things technologies help monitor onsite safety and carry out predictive maintenance in a much better way.
- Banks and financial institutions can increase the speed of payments and money transfer, streamline the identification process, create a robust exchange and remittances platform, and serve customers more efficiently. They are reducing labor-intensive processes by leveraging artificial intelligence to digitize manual processes and offer secure, stable, and competent service.
- In the food and beverage industry, Internet of Things and artificial intelligence are helping companies reach high levels of food safety, improve traceability, cut down wastage and reduce costs and risks across the various stages of food processing and packaging. Mobile-enabling operations in food services allows customers to place orders through smartphones, smartwatches and smart TVs.
- Airlines use apps to streamline check-in, and sports teams use them to boost stadium attendance. The list goes on and on.
What are the various types of digital transformation?
A wide range of technologies are delivering DX outcomes. Let’s take a look.
- Cloud: Cloud computing enables convenient, on-demand network access to a shared pool of configurable computing resources (such as networks, servers, storage, applications, and services) that can be rapidly provisioned and delivered on demand to external customers over the Internet. Cloud technologies (private, public and hybrid) are a critical foundation for rapid and cost-effective DX projects.
- Mobility: As of the first quarter of 2021, 47 percent of web traffic in the United States originated from mobile devices. In comparison, over half of web traffic worldwide was generated via mobile. With wireless networking and devices all but ubiquitous, people and increasingly machines are free to interact anytime and anywhere. Beyond corporate Wi-Fi networks, public and private 5G services promise to enable more sophisticated monitoring, real-time control and mixed-reality use cases.
- Internet of Things (IoT): The Internet of Things describes the network of physical objects – things – that are embedded with sensors, software and other technologies for connecting and exchanging data with other devices and systems over the Internet. Low-power sensors and wireless connectivity change how we monitor and understand real-world environments. The IoT gathers the high-volume inputs needed for data-driven insights, digital twins and closed-loop control systems.
- Artificial Intelligence and Analytics: AI is the simulation of natural intelligence in machines that are programmed to learn and mimic the actions of humans. These technologies use computing power to automate tasks or create insights and correlations from vast amounts of data. Usage includes machine learning, deep learning, natural language processing, algorithms, speech to text (and vice versa), robotics and cognitive computing. Available 24/7, AI helps reduce human error and repetitive work and enable faster decisions.
- Mixed Reality: Mixed reality is the integration of real and virtual worlds to produce new visualizations, where physical and digital objects co-exist and interact in real-time. Virtual and augmented realities enable low-risk simulation, real-time performance enhancement tools, and other ways to improve productivity and outcomes.
- Quantum Computing: By solving massive combinatorial problems in a fraction of the time required by traditional computing technology, quantum computing helps to optimize resources, lower costs, and increase efficiency. Some widespread usage includes machine learning that can help develop various techniques to combat sophisticated cybersecurity threats, including quantum cryptography; financial modeling to perform complex calculations; and logistics optimization of supply chain management such as calculating optimal routes of traffic management, fleet operations, air traffic control, freight and distribution.
How can a managed service provider accelerate transition?
Managed service providers fully manage all aspects of transitioning to centrally managed, cloud-based environments without needing to incur high upfront costs. MSPs carry the risk of delivering the contracted service levels and increased efficiencies as well as improved compliance and security. Here are six hallmarks of partnering with MSPs to ensure your success.
- Provides access to experts across the technology spectrum – Managed service providers give you access to scarce IT skillsets, on a pay-as-you-go basis. Especially with the emergence of new security threats, artificial intelligence, blockchain, Internet of Things and 5G networks to name a few, attracting talent will continue to be competitively fierce. MSPs already have certified engineers knowledgeable in the latest technologies who can become an extension of your team.
- Brings next-gen roadmap to life – Managed service providers help you understand new and existing technologies and platforms, and they will build a lifecycle management program that simplifies execution and reduces compliance and security risks. From IT consulting, project management, hardware/software procurement, virtualization and network infrastructure delivery, MSPs work hand-in-hand with your IT staff in coordinating all the detailed moving parts to assure success.
- Executes platform-delivered services integrated across multiple technologies – Managed service providers have the foundational infrastructure in place to operate a digital business. They can speed your transformation in becoming a digital organization using standardized components to roll out technology services, incorporate automated operational processes and provide scalable templates to deploy modernization projects faster across multiple environments or locations.
- Provides around-the-clock monitoring – Managed security solutions can proactively monitor the security integrity of your entire infrastructure. Security experts identify patterns of events indicating possible threat, determine the risk and act quickly before cyber threats disrupt business operations.
- Improves agility and scalability – The as-a-service nature of managed IT services makes it possible to scale up or down as business requirements evolve. Adding managed services or computing capacity can be a simple point-and-click experience. No longer does your IT staff have to provision servers from scratch to meet growing business demand or workloads.
- Reduces costs – Fixed monthly costs help CIOs manage budgetary allocations and clearly articulate spending needs to C-suite executives. Organizations can break down their costs into predictable monthly payments, as opposed to the large capital expenditures that come with managing systems in-house. Managed service providers deliver great ROI using modern technology that get customers to revenue faster than ever before. They do this while keeping security, compliance, data management and integrity, and regulatory standards in mind.