Vodafone Americas dissects global enterprise challenges for 2016
Editor’s Note: With 2016 now upon us, RCR Wireless News has gathered predictions from leading industry analysts and executives on what they expect to see in the new year.
Dual global economy
Many of the customers we speak to are following a “dual strategy” reflecting a two-speed global economy. This consists of:
• Driving cost excellence and reducing risk/exposure in developed markets such as Western Europe currently experiencing “slowth” – slow or no growth. This is about containing costs, reducing risks and driving operational efficiency to give organizations the headroom to invest and take advantage of growth in other parts of the world.
• Actively driving growth in emerging markets to balance flat growth in developed markets. This time companies are not looking to these emerging markets solely as low cost sourcing or mineral extraction opportunities, but are looking to establish full-lifecycle, in-country operations to manufacture, distribute, sell and service their products.
• As a counterweight, emerging markets also represent not just an opportunity but also a threat from new, more nimble, low cost operators.
• For many companies the growth in emerging markets will have a fundamental impact on their IT infrastructure. For many companies this means they need to rebalance their IT investment, resources and strategy to support this growth in emerging markets.
Rise of the end-user and ‘BYOX’
IT managers will become increasingly compromised managing across the needs of up to four generations in the workplace and managing through the shift in IT decision making spend and power from centralized corporate control to departments, business units and ultimately end-users.
This will accelerate the adoption of changing device form factors, not just from desktop/laptops to mobile tablets/phablets/smartphones, but also the trial and testing (corporate sponsored or otherwise) of, for instance, wearable devices (glasses, rings, watches, clothes, gloves, etc.) taking the user experience to a new level.
But, “bring-your-own-device” won’t be confined to the device. BYOX is the new mantra with consumers bringing their own applications, cloud sharing tools, social media into the enterprise; essentially bringing their own expectations of which technology they want to use and how and where they want to work in a corporate environment.
Growth of the shadow IT budget
Customers will also look to reinvest efficiency savings in driving innovation and differentiation. Technology will be absolutely fundamental to driving this transformation. The 2014 PWC annual CEO survey showed that at 81%, technological advances were considered by CEOs as the No. 1 trend that would transform their business over the next five years, over and above demographic trends (60%) and shifts in global economic power (59%).
And as much of this change and innovation agenda is driven outside of the IT department, e.g. in operations, marketing, sales, customer service, the role of IT will become more strategic and, with new IT budget holders, more complex. Setting clear lines of accountability between IT and line of business budget holders will become key.
Cybercrime
Increasingly the risk of cybercrime or network security breaches is called out by our customers as a topic for special and extraordinary treatment, with many customers appointing chief security officers to protect their organization from the harmful effects of data security breaches.
According to the World Economic Forum, the increased threat of cyberattacks is a top risk today. This has been partly driven by hyperconnectivity and the “Internet of Things.” The problem has also been exacerbated by two key issues: the growth of smartphone devices (potentially increasing the number of attack points); and the increased incidence of corporate data residing on personally owned devices.
Talent crunch: 4th generation workforce
In the U.S. there are 80 million baby boomers who are going to retire over the next five years and they are going to be replaced by 40 million from Gen X and Gen Y – that’s a two-to-one ratio – customers need to be ready for that transition, by developing their “next generation” of staff now.
In many industries (pharmaceuticals, high-tech, manufacturing, mining, oil and gas, etc.) customers are struggling to recruit and retain the right skilled people in the right places. The issue is particularly acute in emerging markets such as India, China and Africa where competition for skilled resources is most pronounced.
Technology evolution: SMAC
Traditional business and market value chains will continue to be disrupted through four unstoppable technology forces: social, mobile, analytics and cloud.
IDC predicts that by 2018, one-third of the top 20 market share leaders in most industries will be significantly disrupted by new competitors (and “reinvented” incumbents) that use social, mobile, analytics and cloud technologies to create new offerings, new business models and new cost structures.
Global change and crisis: VUCA
The frequency and intensity of global change and disruption will continue. This is often referred to by the military term “VUCA,” which means: volatility, uncertainty, complexity and ambiguity.
Organizations will be challenged to build resilient IT infrastructures that, although unable to predict the future, are resilient enough to allow them to operate under a range of scenarios or to react faster as unexpected change events occurs.
Commoditized markets
As development cycles become shorter and the potential for intellectual property to be recreated and copied increases, it is becoming more difficult to create a sustainable competitive advantage for your products and services. Ultimately business leaders will need to ensure that they continue to remain relevant to their customers and can protect themselves from business or product extinction.
Many organizations are looking at technology as a source of innovation to guard against commoditization and to drive competitive advantage. In doing so they are looking at technology to help them to radically improve business processes or to create new products, new business models or brand new market spaces.
