MyWari now available on WhatsApp

MyWari on
WhatsApp
  
Customers now have more widespread access.

ITWeb Africa

Saturday, May 25th

"Organisations are still going about digital transformation in the wrong way' - IDC

  "Organisations are still going about digital transformation in the wrong way' - IDC

Researcher says few have achieved the goal to have an independent digital enterprise.

At the beginning of 2018 global technology research and advisory firm, International Data Corporation (IDC), predicted that South African channel partners would have to evolve strategy and platform to meet the growing demand for digital transformation.

With more than 90% of organisations already embarking on a digital transformation strategy at the beginning of the year, the pathways to digital integration and implementation were under pressure to perform. A year later and the old adage 'the more things change, the more they stay the same' has never been more apt says the tech research firm.

Mark Walker, Associate Vice President for Sub-Saharan Africa at IDC explains that vendors, service providers and channel partners have had to focus on building long-term partnerships and on building richer narratives around digital transformation initiatives and solutions. Strategies have had to evolve throughout the year to meet the increasingly rigorous demands made by organisations and industry.

"The Middle East, Turkey and Africa region will see annual spend on digital transformation initiatives exceed US$20 billion by the end of 2018," he adds. "Market leadership roles are being continuously disrupted and there is a new ICT world order, one that is built around innovation and new business models."

Yet these are the same pain points that have influenced the industry since digital transformation became an acronym (DX), according to the IDC.

The shifts in the market, model and emerging technology have only increased pressure on the channel, the company says.

"Organisations must make the right decisions today to ensure that they are competitive tomorrow and they are looking to the channel to deliver. Unfortunately, there remain challenges around service delivery and strategy as digital transformation demand impacts how vendors engage with organisations and solutions."

No to lock-in

Jon Tullett, Research Manager for IT Services at IDC South Africa, adds, "The as-a-Service trend continues to grow rapidly across software, infrastructure and datacentre. This has complicated vendor service offerings and how customers view their investment. Organisations don't want vendor lock-in anymore. They want to be able to engage with solutions on a strategic and cost-benefit level, not be tied into silos and caught in vendor territory wars."

The IDC executives add that as technology moves through the maturity curve organisations want to take advantage of new solutions that come onto the market. They don't want to be trapped in a five-year cycle and unable to justify the expense of a new investment, nor do they want to be constrained by hardware and trapped in silos that no longer make sense.

"That said, at the recent IDC Cloud and Data Centre Roadshow, it was emphasised that not all lock-in is bad. If the framework delivers the results required, then lock-in is an acceptable compromise. To bridge the gap between the two it is critical that the channel articulate the value, showcasing how lock-in can augment the business and deliver tangible benefits. Ultimately, the shift to digital requires that there be a compromise from both the organisation and the channel partner to ensure that the results map back to the expectation," the company claims.

The arrival of multiple international hyperscale cloud providers (Microsoft, Amazon, and Huawei) is having a noticeable impact on the transformation within South Africa and across Africa, the IDC adds.

"Organisations are showing greater confidence in accelerating their cloud strategies, and the services market is rapidly realigning to offer complementary hybrid services to take advantage of this momentum. The public sector has finally taken positive steps towards a government cloud as a service delivery enabler," says Tullett.

Force multipliers in 2018

These factors already started to act as force multipliers in 2018, increasing the pressure to engage positively in digital transformation to remain competitive and maintain growth.

IDC believes the DX activity in the short term will show direct results in the near-medium term, with noticeable business benefits to DX leaders, and pressure on laggards which will lead to market consolidation, particularly among IT service organisations.

On the downside, 2018 saw the rapid pace of digital transformation and heightened the level of cyber risk continuing to expose organizations to threats, with theft of customer data and financial fraud the primary target for criminals. "Unfortunately, security still lags DX, and the rate of successful attacks has increased in frequency, impact, and cost: a trend which is not likely to reverse in 2019," says Tullett.

"The problem is that most organisations are still going about digital transformation in the wrong way," says Kieran Frost, Research Manager for software at IDC Sub-Saharan Africa. "Not just in South Africa, but globally. The goal is to have an independent digital enterprise and only a few organisations have managed to achieve this. IDC has found that by the end of 2019, 60% of digital services will fail to meet customer experience targets due to performance, utilisation and the degradation of core infrastructure. This is as much due to a lack of investment into the right digital infrastructure as it is to the growing conflict between IT and the business."

A trend that has become increasingly prevalent through 2018 is the struggle for technology control between Line of Business (LoB) and IT. 60% of African CIOs are leaving digital transformation projects to the LOBs themselves – a dangerous approach given that digital transformation requires broad participation of both IT and the LOB.

The battle lines drawn, both sides struggle to find commonality in IT investment and requirement. To resolve the challenge, it is critical that both recognise it is easier to juggle the demands of business and digital transformation together rather than apart.

"Over the next year, both channel and organisation need to look to leveraging infrastructure and putting metrics in place that are easy to adopt and understand," concludes Frost. "Build IT modernisation battle plans, innovate within your space, and evaluate technology through new lenses that ask different questions such as – where is this best deployed, how quickly can that change, who should own its value and how will it integrate with our standards?"

According to the IDC as digital transformation trends and innovation move into a new year, there are lessons learned and new trends to be aware of. The channel remains crucial but needs to invest in skills and solutions that engage with the demands of the digital business. The business, on the other hand, must focus on becoming more integrated from within so its digital strategy can be effective without.

ALSO ON ITWEB AFRICA

SA companies 'slowly but surely' on digital transformation journey Published on 07 May 2019

Dell Digital Transformation Index ranks SA in ninth place in terms of local business maturity levels.

Africa's postal services slow to grasp digital transformation Published on 14 May 2019

Research by Universal Postal Union (UPU) reflects on imbalance of e-commerce services on the continent.

Consider the security implications for payroll when adopting cloud solutions Published on 23 May 2019

The recent launch of two multinational data centres in South Africa has placed renewed focus on the benefits that the cloud can provide businesses says Ian McAlister, General Manager of CRS Technologies South Africa.