The future construction of our industries, IT ecosystems and supply chains hinges on what happens to globalization. Some are ready to ring the death knell for globalization. Globalization was not in the greatest health before the pandemic, but it is not ready to be killed off. Instead, I think we will see a clever balancing act materialize between globalization and de-globalization. Essentially, globalization is where countries become increasingly interconnected with integration of markets within the global economy. De-globalization diminishes this interdependence.
I believe that connected global markets will be pivotal to the emerging touchless economy and the further expansion of e-commerce, for example. But we will see greater decentralization and localization alongside increased automaton and reshoring wherever it makes economic and business sense, for example. Enterprises do not want to be caught out by another global crisis. They want to avoid putting all their eggs in one basket.
What does this balancing act between globalization and de-globalization mean for technology ecosystems? It means a move from centralized to more dispersed technology centers. Technology clusters that can talk to each other. These clusters will lead to more globalization in some areas of technology and less in others. Automation, as I mentioned, will be accelerated to revive domestic manufacturing. Collaboration tools have the potential to grow international business.
This clustered and connected IT landscape will comprise multiple suppliers at local and global levels. They will require seamless end-to-end management if they are to deliver on their performance, security and business continuity promises. As well as many benefits, this transformation will bring with it even greater complexity.
Investing in digital transformation is no longer an option
As I mentioned in my last blog, enterprises that had already invested in digital transformation, networks, security and cloud were able to better handle the curve ball the pandemic has thrown at them.
There is, therefore, no doubt in my mind that digital must be central to operations going forward. Digital and analytical capabilities, for example, will make for smarter decision making and ultimately greater productivity.
At the back end of last year, IDC predicted that by 2024 over 50% of all IT spending will be for digital transformation and innovation, up from 31% in 2018. This could well be higher as enterprises hasten their digital transformation plans post-pandemic.
Speeding up digital transformation, however, is not as simple as flicking a switch. The balance between globalization and de-globalization will further increase IT infrastructure multiplicity alongside technologies such as SD-WAN and multicloud.
CIOs will need to ensure they deploy the right secure services for the task in hand and know exactly where their data is stored. COVID-19 is not going to be the last global crisis enterprises face, and they need to be prepared on all fronts.
Digital transformation also requires skills. Agile teams are crucial to make change happen and innovate new business ideas. There was an in-house skills issue before the pandemic; now many talent pools have run dry, particularly in cybersecurity. At the same time, enterprises are looking for transparency, regulatory compliance, infrastructure optimization and security across a fast-growing digital footprint.
The art of integration
This, as I said before, brings with it even more baggage in terms of complexity. I believe more enterprises will embrace a Multisourcing Service Integration (MSI) approach, which will buy them the time and the skillset to concentrate on re-igniting their business in the new normal. By turning over the management of IT and communications suppliers to an MSI expert, enterprises can regain control of their suppliers, costs and IT estate and prioritize transformation goals.
MSI effectively manages “best-of-breed” services, providing scalability, flexibility and resilience, while sharing operational and risks with suppliers. This allows enterprises to future-proof their IT infrastructure by accelerating digitization and making it far easier to adopt and integrate new services.
Plan, plan, and plan again
There will be some enterprises that panic-buy their way into digital transformation post-pandemic and find themselves out of pocket with incompatible systems.
It is easy to avoid being one of these casualties: first, run an audit to see exactly where the enterprise is on the digital transformation journey; next, engage consultancy and start putting robust plans in place for the next transformational move.
Enterprises must not be duped into thinking there is an end to the journey, either. Digital transformation, like learning, never stops. But enterprises that are not moving up the levels will soon find themselves obsolete in the touchless economy.
Find out more about how MSI can drive your digital transformation.
Richard van Wageningen is CEO of Orange Business Services in Russia and CIS and is the Head the IMEAR (Indirect, Middle East, Africa and Russia) region. He has extensive leadership experience in the IT and telecommunications industries – both in services and equipment manufacturing – and holds degrees from Groningen State Polytechnics and the University of North Carolina. Richard has lived in Russia for more than 10 years and speaks fluent Russian.