How IT Vendors Can Help Firms Realize Digital Potential

by CXOtoday News Desk    Aug 04, 2014

IT vendors

Even though enterprises are moving to become digital businesses, until now very few firms can call themselves ‘digitally equipped’ so as to meet most of their business needs and challenges. At the same time, ‘digital’ is undoutedly the way to go for every organization and it is here that vendors and service providers can tap into this opportunity and play a crucial role, says research firm Gartner.

While Gartner predicts that by 2017, 60 percent of Global 1000 organizations will execute on at least one revolutionary and currently unimaginable business transformation effort, it has also said that digital business incompetence will cause 25 percent of businesses to lose market position for enterprises. This can be an excellent opportunity for IT vendors who should can help organizations with the innovation and industrialization required to transform into digital businesses over the coming decade. They should start to align and adapt their organizational structure, capabilities, offerings, and engagement and delivery models to thrive in this new digital era.

Creating a digital business opportunity may force a restructuring in strategy, talent, portfolio and organization within services providers, says Susan Tan, research vice president at Gartner. She believes that many of them have already taken explicit steps to prioritize the pursuit of digital business opportunities ranging from restructuring and realigning their organization to forming entirely new business units or subsidiaries. They have announced new digital leaders and investments to organically build or acquire digital skills/assets and many have launched innovation centers to serve as client development labs.

Gartner states IT vendors should invest executive time in strategy planning and visioning for the future, focusing on how to close capability gaps, how to optimize organization structures, what intellectual property (IP) to invest in and what go-to-market models are new imperatives. This should determine if the current organization structure and leadership will support digital business expansion, or if reorganization or realignment of current organization structures is needed. Thereafter, they should establish digital leadership skills, and acquire or hire the right talent, including capabilities in design, user experience, digital technologies and business consulting.

Service providers must also come to terms with the fact that in a digital world, their existing delivery models will not effectively address new demands evident in fast-paced, often exploratory digital pursuits - with buyers seeking business outcomes that complement the decisions that they make and with solutions becoming more sub-vertical, market-specific leaning toward information-driven alignment versus process-driven alignment.

With the broad range of services and equally broad array of digital strategies of providers, it is critical that service providers clearly define their own portfolio and focus, and identify the targeted buyers appropriate for their selected services, says the research firm. Going forward, the restructuring and new digital business units and leadership are needed to focus investment and develop resources for applying digital technologies to realize business value,” she says.