If 2020 has one lesson for business, it is that digital transformation is essential to every company, in every industry. Avoiding the hard questions around it is no longer a viable business strategy, whether you are the CEO of a top FTSE100 company, a small business owner, or somewhere in between.
The year has been a turning point, and not just for obvious reasons. 2020 will also be remembered as the year when numerous cutting-edge technologies became not just a convenience, but critical to getting work done.
Perhaps the most visible example of this is just how much time we now spend on video conferences with colleagues, but the changes are much broader. Technologies like 5G , cloud, data analytics, Internet of Things (IoT), and artificial intelligence are transforming every industry and every sector, and are creating new and exciting opportunities to boost productivity, increase flexibility and ensure that the strategic fabric on which our businesses rest, are stronger than ever before.
We don’t have to look far for examples of this digital transformation creating stronger organisations. Take the rise of cloud-based platforms, for example.
In a previous era, businesses were ultimately tethered to a specific building or office, as that’s where the company’s documents were held by on-premises servers that were accessed by computers on the local network.
But today in an era of Office 365, Microsoft Teams, Google Workspace and other as-a-service solutions, organisations that have embraced the cloud are no longer limited by physical location. We are confident that we can always access that document we need, whenever we need it, whether we are at work, home or on the other side of the world, with the same tools and security.
And perhaps more importantly, the rise of cloud working combined with highly reliable communications has led to new, emergent types of collaboration, with multiple people working together remotely on the same document at the same time.
So not only does cloud mean greater productivity, it also means greater flexibility. So that if circumstances change and, say, we needed to work from home, businesses built on the cloud can be confident that employees can continue working, and that IT systems will scale without the need for more physical infrastructure.
However, though clearly transformative, adoption of cloud as-a-solution services, as well as other technologies, remains relatively low among British businesses. I think this is a tragedy. It means that they are potentially missing out on some big opportunities.
Earlier this year, BT conducted research with YouGov to find out how UK businesses are working with emerging technologies, and the results were revealing. While 44% of British businesses are now routinely making use of voice-over-IP (VOIP) technologies, use of the cloud is much lower: Just 25% say they are making use of SAAS software, with even smaller numbers are interested in using technologies like IoT, machine learning, 5G and virtual reality (VR).
What was particularly striking is that the survey results also reveal that there is a digital divide emerging. The largest organisations (with 1000 or more employees) are significantly more likely to be using transformative new technologies than smaller companies. Most alarmingly though, was that both 29% of large businesses and 32% of small businesses said that they are not planning to acquire any future technologies in the next five years.
This, I believe, at best is leaving opportunities on the table, and at worst could be a huge risk to the business, as it means there is a lack of awareness of the potential value created by these emerging technologies..
What sort of value do the emerging technologies bring to businesses, using the power of converged and reliable communications? It is possible to imagine how different technologies will impact different sectors.
For example, take healthcare which is facing unprecedented demand, especially accelerated under the Covid-19 pandemic. This is a sector which in the medium-to-long term faces the strategic challenge of an ageing population, which burdens hospitals and in particular A&E. As the elderly make up a larger proportion of people relative to those of working age, and as care needs grow more complex, it is a great opportunity for businesses in the sector to look to new technology to see how they might meet these future challenges and ensuring proactive digital healthcare, by keeping patients and elderly well monitored at home.
Could telemedicine, powered by video conferencing , 5G and converged reliable communications, make it easier for doctors to speak to more patients than they would normally be able to face-to-face? Could machine learning be used to triage and assist the diagnostic process by spotting signs of common ailments? Could artificial intelligence even be used to predict potential health issues in patients before they emerge to improve preventative care? Could these new efficiencies lead to real, tangible, improved outcomes for patients, such as reducing the waiting times for operations?
Manufacturing is another sector that is ripe for disruption by embracing emerging technology. For example, traditional factories are not particularly flexible workspaces. Shop floors contain heavy equipment that is configured to perform a specific, limited number of functions. Machines are connected to networks through physical cables. But this is not how the modern world will work, as businesses want flexibility, precision and rapid reconfiguration of shop floors, in terms of the ability to rapidly prototype and launch new products, or monitor and adjust manufacturing output to meet the changing demands of the market.
So what role can emerging technologies play here? 3D printing, for example, means that whatever type of widget is needed can be easily produced on an ad-hoc basis, with no need to stick to a precast design. 5G, IoT, data analytics and private networks are already being used to control factory systems and equipment for mission critical operations. There are a plethora of cutting-edge applications and use cases, for example autonomous guided vehicles (AGV), always connected sensors, high quality video surveillance, and many more which are enabled by 5G low latency communications, Quality of Service (QoS), and linking applications to the cloud.
This means that more detailed analytics on the manufacturing process can be reported back to managers, and more functions can be automated by systems responding in real time. And if the demands on the factory do change, then equipment can be more easily reconfigured, without the need to deconstruct and rebuild a production line from the ground up.
These are just two of countless examples. The opportunities in each sector are different, but similarly transformative, whether it is the role of cryptocurrencies and the blockchain offering financial firms new models for building trust in digital transactions, or AI-powered predictive maintenance changing how the transportation sector performs safety checks. But what is consistent, is that in every sector there are enormous opportunities for business in the embrace of digital transformation.
Digital transformation challenges
Of course, I know the reality is that digital transformation is hard. There is the need to bring stakeholders with you as you transform the business, there is the “tech debt” - the need to leave behind legacy systems and processes, rewire the business and adopt new operating models, often at a fundamental level. And there are concerns about the cost of investing in new technologies, a factor which was cited by 33% of companies surveyed by BT and YouGov.
But I think the flipside of this is more important. You have to recognise that digital transformation is not a burden, but an opportunity to take the long-term view, and position the business so that each process and function is optimised for a world that brings together the likes of as-a-service solutions, IOT, data analytics, 5G, edge computing and security. These technologies are no longer “emerging”, but are shaping our decade to becoming the new normal. In the long run, the short term cost considerations will seem insignificant compared to the value created by investing today.
As 2020 has shown us, the world is changing quickly, and emerging technologies are already here and are just waiting for us to take advantage of them. Every CEO and CTO in business today should be aware of this, and should ask themselves the question: Are you doing the best you can to seize the opportunities and strengthen the very fabric of your business?
To find out more about how UK businesses are working with emerging technology, download The Future in 2020 report.