Regardless of the current state of the overall economy, the top funding priority for organizations beyond traditional IT investments continues to appear to be digital business transformation.
A recent survey of 1,703 information technology leaders conducted by Red Hat identifies digital transformation and technology skills tie as the top priorities (37%), followed by people and skills training (30%). Naturally, all three of those investment areas are closely linked with one another but overall, it remains to be seen how many organizations in the coming year will be doubling down on digital business transformation initiatives.
The challenge, as always, remains the skills gap organizations encounter as they digitize processes, notes Gordon Haff, technology evangelist for Red Hat.
Less clear is to what degree organizations might be scaling back their ambitions in the face of a weakened global economy. In the wake of the COVID-19 pandemic, organizations launched a raft of digital business transformation initiatives but not always with the proper due diligence. Many decisions were driven more by a sense of urgency than practicality. Since then, more organizations have focused their efforts on the initiatives that provide the highest level of return.
However, not every digital initiative is equally embraced by customers. Far too many are simply an online instance of a previous paper-based process that is just as, or sometimes even more, cumbersome than the process it replaced. Heading into 2023, it’s apparent many organizations need to rethink how processes should be truly re-engineered for the digital age.
The Red Hat survey also makes it clear that organizations are also revisiting cybersecurity. Security took the new top position with a three-point increase compared to a similar survey conducted a year ago, while innovation dropped five points, with 19% now identifying it as their top priority for digital transformation. “Security has become a much bigger priority,” says Haff.
Clearly, the level of maturity being brought to bear on digital business transformation projects is increasing. The coming year is more likely to be defined by what amounts to a technology arms race as competitors with various vertical industries race to design and implement digital processes that provide sustainable competitive advantages. Executives should also assume the barrier between one industry segment and another is only going to become more porous, so the chances are good they will wake up one day to discover they have a new unexpected rival. It’s also worth remembering that the cost of entry for a startup company to enter a sector is also dropping as access to IT platforms in general becomes more democratized. It doesn’t always require the developers with advanced skills to create a compelling digital application experience
Adding a mobile front end to an existing application, while helpful, is not likely to achieve that goal when rivals can use low-code tools to replicate the same process in a matter of hours. Instead, senior business and IT executives will need to completely re-imagine what the ultimate customer experience really can be as, for example, artificial intelligence (AI) technologies such as ChatGPT continue to evolve.
In fact, it may soon turn out that the single biggest existential threat to any organization is going to be a simple lack of imagination.