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Rise of the digital giants

Rise of the digital giants.

Digital disruption to markets is inevitable and the question posed at Gartner Symposium 2016 is how will CEOs and CIOs respond?

CEOs know they must take digital to the core of their businesses, blurring the boundaries between physical and digital, and CIOs will have to become more proactive in supporting the transition to digital in order to disrupt markets.

This is according to analysis and research presented by Gartner at the 2016 Symposium and ITExpo hosted in Cape Town this week.

Referencing the example of McDonald's use of self-service kiosks in all of the fast food chain's 35000 restaurants globally, VP and Gartner Fellow in the CEO Research Group, Mark Raskino said, "What does McDonald's sell... the generic answer is fast food, well this is the fast bit... We are taking digital right into the product proposition and CEOs understand this from their customers."

According to Gartner and feedback sourced from CEOs, the top five strategic business priorities for the next two years will be growth (54%), customer (31%), workforce (27%), corporate (24%) and IT-related (24%), with the issue of efficiency and productivity trailing in last place at (9%).

"Business leaders really are focusing on technology. It's not just a 'we wish they would', it's a 'they actually are' kind of situation," said Raskino. "Digital is now part of the business structure. CEOs are just not focused on that (efficiency and productivity), their association of technology is all about growth and innovation."

The Gartner exec also made reference to Ntuthuko Shezi, CEO of Livestock Wealth, a business focused on the virtual ownership of cattle, as leading a business model that has embraced technology to blur the lines of physical and digital.

With CEOs now turning their attention to technology to combat earnings recession and increasing their belief that digital will impact on profitability over the next five years, there is an expectation that digitally attributable revenue will grow.

This has underlined the input and roles played by both the CEO and CIO in directing the business on its digital journey.

"CIOs should help their chief executives to prepare for or preempt digital business industry disruption. We were talking about the 'digital giants', whether to fight them or whether you're going to make friends with them. There's no shying away from this... in multiple sectors digital giants feel like they can invade," said Raskino.

Disruption is a real feature and boardrooms are really concerned about it, he added.

With so-called 'digirati' and 'digital giants' poised to disrupt industries and flip the value proposition, distribution and adoption of products on their proverbial heads, CEOs and CIOs are having to adapt their strategies accordingly.

The challenges of productivity, the shift in focus to the narrative of 'employee' recruitment rather than talent acquisition, and cyber security, there is a need for leaders to organisations today to develop key skills including digital and IT, agility, innovation and trend analysis.

Gartner's message to the market is that CIOs are called on to become more proactive in helping chief executives develop and benefit from the digital business world, and part of the foundation of this is the development of capabilities to digitally remaster products and services.

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