Point of View

Embrace the power of AND for greater emerging technology value

December 22, 2020

Go piecemeal at your peril.

COVID-19 has re-contextualized and accelerated digital transformation initiatives for the majority of enterprises. The pandemic has also redefined priorities, barriers, and mindsets within whatever that pre-pandemic definition of transformation was. Enterprises are finally recognizing digital transformation as a “have-to-have,” not a “nice-to-have.” Practically every enterprise the recent Enterprise Reboot survey by HFS Research in collaboration with KPMG International is investing in individual emerging technologies as many become, in leaders’ own words, “essential for survival.” But the winners realize more identifiable business value through the combined power of emerging technologies being aligned towards outcomes—versus the less fortunate that remain trapped by their proverbial piecemeal implementations.

Nearly two-thirds of enterprise leaders believe that the combined use of emerging technology is beneficial—and a similar number say AI, automation, smart analytics (the Triple-A Trifecta), cloud, and low-code are converging

In Exhibit 1, we see priorities shift toward the more advanced capabilities under the emerging technology umbrella; for example, HFS’ Triple-A Trifecta of automation, AI, and analytics, low-code/no-code automation, and deep learning AI. The more business-critical the challenge and the more complex the problem, the more integrated these initiatives must become. It’s increasingly obvious that piecemeal approaches to technology investments and standalone pilot projects do not deliver the full value and scalability that enterprises need. The pandemic has given the integrated nature of the HFS OneOffice vision new meaning—as it has done to the broader definitions and images of digital and transformation. We see it in the actions and cultures of enterprises using this burning platform to drive change.

Exhibit 1: The power of AND for the win. Enterprises see greater value from using emerging tech in combination versus piecemeal—and the convergence will only continue.

Sample: 600 executives across Global 2000 enterprises (Phase I sample)

Source: HFS Research in collaboration with KPMG International

As technologies integrate, benefits accrue

For most businesses, cost savings and efficiency are vital right now—but they are realizing simultaneous improvements to customer, employee, and partner experiences as win-wins (Exhibit 2). Employees’ mindsets are changing, and customers are more willing to adopt technology—demanding it in most cases—as are ecosystem partners. Automation is a prime example; many firms led with it as a baseline step into digital transformation before adding combinations of analytics, AI, and others to create integrated platforms that can scale and realize the value that these technologies originally promised.

Exhibit 2: Organizations that “strongly agree” to the power of AND have a higher realized value than organizations that “disagree.”

Sample: 600 executives across Global 2000 enterprises (Phase I sample)

Source: HFS Research in collaboration with KPMG International

AI and analytics are conjoining with cloud—winning businesses combined these technologies before it was cool and are now also seeing the benefits in their cultures

Cloud has been through a decade of being the cost-take-out option for IT—reducing infrastructure footprints and thinning out datacenter estates. The highlighted intersections in Exhibit 3 match our enterprise network’s commentary: Increasingly, cloud is all about more effective data enablement and unleashing AI’s potential through the accessible, clean, and usable data that you can use to build quality algorithms.

Before the recent splurge of provider solutions and vendor products trying to integrate emerging technology portfolios, some enterprises just went ahead and built it themselves. A banking leader told us at a recent roundtable event about a home-built technology stack; basically, they built it because they couldn’t buy it. COVID-19 has meant a step-change in attitudes toward technology. User adoption and a focus on business outcomes, i.e., a “pull” from the business, is “like night and day. There’s no discussion around losing jobs, rather the reverse: how do we protect jobs and do so in a way that’s better for both our employees and customers.” The business’ existing automation platform, with machine learning, analytics, process intelligence, and more, was previously seen as a threat, but now, with a workforce at home, it kept it afloat. The platform’s adoption saw a step-change, with departments

Exhibit 3: AI leads the charge as the ultimate partner for AND initiatives.

Which other emerging technologies are you using in conjunction to significantly enhance the value from them?

 

Sample: 600 executives across Global 2000 enterprises (Phase I sample)

Source: HFS Research in collaboration with KPMG International

COVID-19 has forced a step-change in business’ cultures: employees at all levels now want to adopt emerging technologies

Automation programs have for some time used a range of technologies from RPA to ML to digital associates—but now, the existential problems the pandemic posed require integrated solutions that drive wholesale change with a broader combination of emerging technologies… rather than a quick proof of concept or piecemeal efficiency projects focused on pesky manual tasks. Previously, only those directly involved in the technology dream-team would have even a loose understanding of the now-present future of work.

Employees (from the C-suite to the shop floor), customers, and partners alike are discovering wonders like automation removing soul-crushing manual tasks or enabling new capabilities like rapid onboarding. One financial services leader told us how their digital workforce is now a board and CEO priority; since March 2020, the CEO has received a monthly report covering day-to-day digital work production and how it compares with a human workforce. The 2021 plan now includes technology ambitions beyond automation and cloud throughout the company.

The Bottom Line: Emerging technology success needed a business case and change of culture before COVID-19—now they’re even more critical.

Despite a range of new priorities and barriers, culture—specifically an inability to change—is still consistently lamented by enterprise leaders. The pandemic forced digital change, which spurred enterprises around the globe to embrace emerging technologies and use them in ways they never dreamed possible. As enterprises ready themselves to compete effectively in the new digital dawn of 2021, the power of AND is proving to be one of the most effective ways to both optimize your digital business operations and maximize your returns. Go piecemeal at your peril. Embrace the power of AND for heightened value.

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