Strategy & Best Practices

Is Digital Transformation Dead? Here’s Why We Say No

By Rebecca Muhlenkort / February 7, 2023

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Ready or not, we’re off and running into 2023. And as businesses execute their 2023 playbooks, many industry leaders believe there’s a lot to be optimistic about, even with concerns over stagflation and a slowing economy. During a recent AppDirect State of the Union event, Nicolas Desmarais, Co-Founder & CEO, AppDirect and AppDirect’s Christopher Shubert, Vice President of Advisor Sales, outlined how technology trends will likely intersect with market conditions over the coming months. They believe savvy advisors can still find growth opportunities by focusing on UCaaS, CCaaS, and IaaS, particularly as companies look to meet digital transformation goals and optimize IT spending.

There’s still a lot of revenue to be made with the XaaS model. Read the blog here.

IT spending projected to grow 5.1 percent in 2023

Recent Gartner forecasts assert we’ll see an increase in spending as companies look to digital technology to smooth over any economic uncertainties. (See Table 1).1

Table 1. Gartner’s Worldwide IT Spending Forecast (Millions of U.S. Dollars)
Table 1. Gartner’s Worldwide IT Spending Forecast (Millions of U.S. Dollars)

AdvisorsWhat does this mean for you?

Accenture believes there’s a shift in how leaders view digital transformation goals. And that’s good news for savvy advisors. The consulting firm indicates digital transformation efforts—particularly initiatives related to cloud and data—are critical in today’s economic environment.

“Prior to the COVID-19 pandemic, digital transformation largely focused on customer experience. Then, everything changed—and accelerated. Now, digital transformation is the centerpiece of operational efficiency and innovation across the organization.”2

Another report by the CNBC Technology Executive Council shows that more than three-quarters of tech leaders expect their organization to spend more on technology this year. 

Here’s how Nicola Morini Bianzino, Chief Technology Officer at professional services giant EY, breaks it down: “In other cycles we’ve seen in the past, tech investment was one of the first casualties. But after the pandemic, people realized that in a down, or even potentially recessionary, environment, we still need to keep our technology investments.”3

How advisors can win in the digital transformation 2.0 era

In this new era, how can you best support customers in meeting their digital transformation goals? And how can you set your sales up for success in the coming year?

AppDirect Cloud Specialist Aly Fitzpatrick outlines why digital transformation still matters. "Digital Transformation is a process, a journey. The rate of adoption on that journey has exponentially increased. It is a process your customers are 100% engaged in, or planning for right now.”

View the video to learn the steps to digital transformation, and for tips in shaping customer conversations.

Customer talking points: Transitioning legacy technology to the cloud

As leaders outline their objectives, advisors are in the best position possible to guide them. Take opportunities to educate and inform customers about how to replace legacy, on-premise technology with flexible, more scalable cloud-based solutions.

What technology areas are primed to moving to the cloud?

  • Data center

  • Network

  • Email, servers

  • People and collaboration tools

View the video to learn what legacy infrastructure companies are transitioning to cloud.

AppDirect Invest Partner and President of NXTSYS, Dave Wallace, is one business leader who predicts growth in cloud collaboration tools like UCaaS, even if growth comes from something other than new subscribers. He asserts that UCaaS revenue is generally a safe bet for advisors because it's typically hard to remove when a customer installs a UCaaS product. He alleges that the revenue for the account grows over time because customers add on functionality and products such as headsets and mobility options. And, because customers typically make these additions using self-service options, advisors earn more revenue for that account without spending additional time on customer support.

Use generic technology terms… at first

AppDirect's Cloud Expert Steve Leach recommends staying high-level instead of getting into the bits and bytes during customer conversations about digital transformation. He believes this approach helps advisors avoid inadvertently steering a customer to a provider that may not be a good fit. By using generic technology terms and asking questions, you can better understand the customer's biggest pain points and position the right solution right off the bat.

“If we look at the three main platforms that are out there, Microsoft, Google, AWS. If you delve into their specific terminology, they all three call them different things. So you have to be very careful. When you start looking at security, we talk about firewalls. Everybody talks about identity and access. And kind of staying on those levels of the generic terminology allows you to ask the questions and find the pain points before recommending a particular solution…”

Start this video at minute 2:20 to hear Steve highlight what you should know before talking about individual providers. Watch now.

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1 Gartner Forecasts Worldwide IT Spending to Grow 5.1% in 2023
2 Accenture: What is digital transformation
3 CNBC: Technology Executive Council