TORONTO, Canada — IDC Canada research conducted in partnership with SAP Canada today reveals that while emerging technologies such as Internet of Things (IoT), Big Data, AI and blockchain have the attention of Canadian organizations, most have a long way to go. These organizations must explore how they can extract value from data to become more innovative and competitive both domestically and globally. While most Canadian businesses are behind, a group of “digital front runners” have emerged and provide examples of progress others can learn from.
As part of the survey, IDC explored the initiatives of digital front runners, identified as those companies more willing to take risks and experiment with new technologies, to understand where digital transformation initiatives are paying off. A detailed study of interview respondents from Canadian businesses with $500M+ in revenues captured first-hand commentary from experienced functional leaders across finance, human resources, marketing, operations, and procurement. Among this select group, IDC found that digital front runners were actively deploying new technologies like predictive analytics, machine learning, AI and IoT with clear business outcomes.
The research report also includes findings from IDC Canada’s top executive study, an annual survey of 173 business and enterprise IT leaders. That study found that eight out of 10 executives now consider cloud a top priority for competitive positioning. With most businesses having — or on the way to having — a cloud platform in place, they are now increasingly looking at how Big Data, AI, IoT and blockchain can help them extract more value from data, enabling them to create new business models or reimagine the customer experience as they aim to become intelligent enterprises.
Of executives surveyed, 54 percent said Big Data and analytics are critical in their journey to be coming an intelligent enterprise, up from 43 percent last year. Another 32 percent consider IoT central to their strategy, up from 29 percent. Twenty-six percent of respondents said the same of AI/cognitive systems, and nine percent reported on the importance of blockchain, both up from the April 2016 IDC Canada study.
The 2018 study also drilled down to examine how digital transformation is taking shape across different lines of business and industries throughout Canada, including finance, HR, retail, utilities and oil and gas. In financial services, for example, customer-facing AI initiatives such as chatbot services aim to enhance customer support and boost uptake of new products by reducing adoption barriers. IDC predicts that by 2019, 35 percent of insurers globally will deploy AI or robotic process automation for intelligent decision making. In retail, IDC predicts that by 2019, 40 percent of retailers globally will have developed a customer experience architecture supported by artificial intelligence.
The report explains how Big Data and the technologies it enables are creating opportunities across all lines of business. For example, in procurement and HR, data is being used to reduce wastage and recruitment costs respectively. Marketers are using data to customize products and analyze shopping trends, while operations departments are finding ways data can be used modernize and optimize processes. Finance departments especially stand to gain from digitization, with a broad range of possible use cases across blockchain, AI and Big Data.
Tony Olvet, Group Vice President, Research Domains, IDC Canada, said: “Digital transformation is a balancing act that requires both offensive and defensive consideration — you could call them ‘accelerating factors’ and ‘stabilizing factors’. Accelerating factors are tied to enhancing customer experience, revenue, growth, and other indicators of progress; stabilizing factors help organizations manage risk, security, compliance, and other hurdles.
“AI and analytics have as much of a role in stabilizing factors like cybersecurity as they do in accelerating factors like talent acquisition. The greatest future promise lies in artificial intelligence applications. IoT solutions are ramping up but are more industry-specific. We also see a lot of curiosity around potential blockchain applications, but its current usage is low among Canadian enterprises.”
Andy Canham, Managing Director, SAP Canada, said: “Businesses are seeing the value of data. The question now is, what do you do with it? Turning your business into an intelligent enterprise will make you a disruptor rather than a follower. Cloud is table stakes; data is the real game-changer.
“Digital transformation, or in other words, extracting value from data, is a 5-step process. First, you need to translate corporate priorities and initiatives into technology priorities. Then you explore opportunities based on strategic initiatives and prioritize based on value. When this is done you can document the end-state solution, qualitative and quantitative benefits, and strategic road map. This allows a business to measure value delivered through transformation, and governance helps to maximize and accelerate value from investments based on executive engagement, value delivery, and continuous innovation.”
SAP’s digital innovation system Leonardo offers next-generation technology innovations such as IoT, machine learning, advanced analytics and blockchain to help customers optimize core business processes and reinvent their business models over the SAP Cloud Platform.
The IDC Canada study Building Success in a Digital Economy: Canadian Enterprises Make Bold Moves to Transform, which delves into how digital transformation is taking shape in different ways in Canadian enterprises, the factors propelling change in business, and transformation stories from the likes of Cirque du Soleil, TransLink and Coast Capital Savings, can be read here.