A new study shows that the rate of readiness for digital transformation has increased substantially since 2015. Companies are budgeting for digital transformation with funded projects in analytics, mobile, IoT and other technologies.
IFS, a global enterprise applications company, has released a primary research study of 200 North American manufacturing executives which reveals more than half of respondents expect their budgets for digital transformation to increase in the next two years.
The IFS study also reveals that substantial investments have already been made in digital transformation initatives, leading to a 26 percent increase since a 2015 study in companies saying their enterprise software did a very good or good job preparing them for digital transformation. Based on the results from the study, IFS believes digital transformation will continue to accelerate in coming years since only 5 percent of respondents expected their budgets to decrease.
IFS’s results are corroborated by analyst research indicating a groundswell of investment in transformation. According to a study by IDC, global digital transformation spending will reach $1.7 trillion by 2019, increasing 42 percent over 2017. “According to the 2018 Gartner Digital Business Survey*, 59 percent of midsize enterprises (MSEs) intend to pursue their digital ambitions by both optimizing and transforming their business for the digital era.”
“Today, a lot more companies feel they are prepared for digital transformation than they felt a year ago,” IFS CTO, North America, Rick Veague said. “It is not likely that 20 percent of the market replaced their enterprise systems. It takes longer than that to identify a project, select technology and implement. Some may have already had projects in place and seen them come to fruition. But a good percentage are now, a year later, more aware of the possibilities. There are simple wins to be had by leveraging more accessible technologies like mobility and, increasingly, IoT. Now that enterprise software vendors have planned their offerings around these technologies, the pace of change can pick up quickly. Those who cannot change at the pace of their competitors will be left behind.”
The study also sheds light on the type of transformation projects respondents have budgeted for. Analytics and mobility projects were the most frequently funded among respondent companies.
Download the study: Digital Transformation Budget Trends in Industrial Companies
*Gartner, Digital Business Transformation: A Midsize Enterprise Perspective, July 2018