Economy transforming to digital, says Gartner

Every budget being an IT budget, every company being a technology company, every business is becoming a digital leader, and every person is becoming a technology company says Peter Sondergaard, senior vice president at Gartner and global head of Research.

“The Digital Industrial Economy will be built on the foundations of the Nexus of Forces (which includes a confluence and integration of cloud, social collaboration, mobile and information) and the Internet of Everything by combining the physical world and the virtual,” said Peter Sondergaard.

“Digitalization exposes every part of your business and its operations to these forces. It is how you reach customers and constituents; how you run your physical plant; and how you generate revenue or deliver services. Enterprises doing this today are setting themselves apart and will collectively lead the new digital industrial economy,” added Sondergaard.

In 2009, there were 2.5 billion connected devices with unique IP addresses to the Internet, most of these were devices people carry such as  mobiles and PCs. In 2020, there will be up to 30 billion devices connected with unique IP addresses, most of which will be products. This creates a new economy.

Gartner predicts that the total economic value add for the Internet of Things will be $1.9 trillion dollars in 2020, benefiting a wide range of industries, such as , healthcare, retail, and transportation.

“Digital changes the IT market in a big way through the Internet of Things,” said Sondergaard.

In the technology and telecom sectors, revenue associated with the Internet of Things will exceed $309 billion per year by 2020 added Sondergaard.

The digital world runs faster for many traditional IT suppliers. In the past, the top technology companies reigned over the industry for long periods of time. However, now the leaders in areas such as cloud and mobile were not on many CIO’s radar five years ago.

“What many traditional IT vendors sold you in the past is often not what you need for the digital future. Their channel strategy, sales force, partner ecosystem is challenged by different competitors, new buying centers, and changed customer business model,” said Sondergaard.

“Digitalization creates an accelerated technology-driven start up environment across the globe. Many of the vendors who are on top today, such as Cisco, Oracle, and Microsoft, may not be leaders in the Digital Industrial Economy.”

All of these “things” connected to the Internet generate data. People and their activities create data. Smart machines consumer and produce data, and mobile devices are the windows into data. Mr. Sondergaard said the effective digital enterprises harness that data to change their business.

“Digitalization will create new infrastructures and new vulnerabilities in our infrastructures. We recommend that you build a portfolio of security vendors because no single vendor addresses more than a fraction of your problem. Everyone will need to establish more agile security processes,” added Sondergaard.

Leave a Reply

%d bloggers like this: