Industry Insights

Experts Predict 2019 Digital Transformation Trends at AppDirect Engage

By Ideas @ AppDirect / Oct 24, 2018

It can be notoriously hard to predict the future of technology, but it helps to listen to the people who are on the front lines of digital transformation. They see first-hand the challenges, opportunities, and changes that digital technologies bring, and they are the bellwethers of where we are headed next.

Last week, AppDirect held its annual digital economy summit, Engage, where experts from a range of industries shared best practices and insights that are shaping the digital transformation journeys of companies around the globe. Here, we’ve gathered five of the top trends explored at Engage that will shape the digital economy in 2019, and beyond.

1.) Flexibility Becomes the New First-Mover Advantage

In business, being first to market always provides a big competitive advantage. However, as more companies in a range of industries launch marketplaces, build ecosystems, and deploy platforms, the ability to test and change digital strategies is becoming just as important.

With legacy technology, “it’s painful to launch a new service, even if you have the right capabilities. It can take months, even years, and cost hundreds of thousands of dollars,” said Nicolas Desmarais, AppDirect’s co-CEO, during his Engage keynote. In today’s digital economy, companies need the ability to bundle and sell any type of digital product—and physical hardware, if necessary—on the fly. 

“It’s painful to launch a new service, even if you have the right capabilities."

In 2019, companies that use flexible technology that allows them to easily add products, change pricing, and customize the look and feel of the customer experience will do better on every measure of digital success than those that don’t.

2.) Marketplace “Build vs. Buy” Becomes a No-Brainer

Companies often spend endless hours evaluating whether to build or buy technology solutions. However, as business tools mature, most reach a tipping point where the “build” option no longer makes sense. For example, few enterprises seriously consider building their own CRM or ERP tools with solutions like Salesforce and NetSuite readily available. 

Marketplace technology has reached this same tipping point. “ABB is a digital innovation leader, but we are not a software company,” said Alain Schaefer, Digital Growth Lead at ABB. “Our core competency is helping customers optimize their processes, so we didn't try and build the solutions that power the ABB Ability Marketplace. We partnered instead.” 

Today’s marketplace and platform technology can offer sophisticated tools to handle the complexity of billing, provisioning, and managing digital products and services that would take years to build in house. In 2019, more companies will recognize this and “buy” to accelerate time to market and ROI. 

3.) Industry Silos Break Down as Companies Look for Digital Transformation Best Practices

It is undeniable that each industry faces unique digital transformation challenges. After all, pushing an over-the-air software update to a fabrication machine on a factory floor is much different from driving small businesses to adopt SaaS office productivity tools. 

However, it is becoming increasingly clear that companies in different industries have much to learn from each other when it comes to digital transformation. “Do you sell a turbine the same way you sell a digital service? The answer is obvious, but not to us,” said ABB’s Alain Schaefer. “We are actually looking to the telecom industry to see how ABB can apply what they have learned to our own digital transformation.”

“Do you sell a turbine the same way you sell a digital service? The answer is obvious, but not to us.”

Just as companies like ABB are looking to telcos for best practices, many telecom companies are looking to the manufacturing vertical for guidance on how to approach IoT, an area where manufacturers have a head start. In 2019, this type of cross-industry idea-sharing will become more common, and more valuable.

4.) Your Biggest Competitors Become Your Best Partners

As ADP launched its marketplace for human capital management (HCM) software, Steve Roth, VP Product Management for the ADP Marketplace, heard some internal dissent. “A lot of people were asking why we were making it so easy for our competitors to do business with us,” he said. 

“A lot of people were asking why we were making it so easy for our competitors to do business with us.”

The answer is simple: Customers care about outcomes and ease of use, not competitive battles. Building an ecosystem of solutions—even those that might compete in the same space—allows companies to do far more than they can on their own. In 2019, the companies that partner well will provide more value to customers and accelerate their digital transformations past those that don’t. 

5.) Defining Your Company as a Product Becomes a Losing Proposition

IBM is an iconic brand that conjures up concrete images: punch cards, the first PC, and Watson, the supercomputer that can beat humans at “Jeopardy!” and chess, among many others.

Given this, how does one of the world’s most well-known technology brands evolve for the digital economy? It starts by shifting away from products to value-added services. As IBM’s Catherine Solazzo explained, “don't define yourself as a product. It's a service-based, subscription economy now.”

“Don't define yourself as a product. It's a service-based, subscription economy now.”

For IBM, this means focusing on its new machine learning and business services that can help customers do more with its products. For other companies in 2019, it means determining what services you can deliver to complement your core products and provide more value.

The Bottom Line: Listen to What Works

In just a few years, digital transformation has gone from buzzword to critical business objective. The journey still requires bold strategy and risk-taking, but as companies around the world experiment to see what works (and what doesn’t), there is more good advice to go around than ever before. The predictions discussed here can help businesses see around the bend and move faster to reach digital transformation success. 

Click here to learn more about how AppDirect is powering digital transformation with industry-leading solutions and expertise.

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