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Ready or not, the digital economy is coming

The digital economy is coming, says IDC, and traditional organizations will need to adapt in order to stay relevant—and fast! This new economy, which is facilitated by technologies such as the cloud, artificial intelligence, the Internet of Things, and augmented and virtual reality, is rapidly changing the way business is done both here in the U.S. and abroad. According to IDC’s research, 33 percent of the current U.S. economy is digitized, and by 2020 (just three years away) they predict that 50 percent of the global 2,000 will see a majority of their businesses digitized.

The digital economy beckons

What can we—as technology companies—do to prepare for this emerging economy? That’s the question that IDC hoped to answer during its latest conference here in Boston, Directions 2017. A concept that was front and center is called “digital transformation,” or DX. While the type of transformation really depends on the organization, IDC believes that in the near future every company will become a technology company. Citing Campbell’s recent acquisition of Habit, a technology company specializing in personal nutrition plans, chief analyst Frank Gens posited that even the most traditional companies are going digital.

Five years ago, self-driving cars seemed like a thing out of science fiction, but examples from Google, Uber, and Tesla have proven that the technology is here. Today’s DX initiatives are quickly becoming mainstream, and organizations that are not in the game will see themselves ceding market share to competitors who are. Macy's, for example, is using a virtual reality experience to bring Asian shoppers into their stores where they can browse products and make purchases in VR. They are able to do this without the investment in brick-and-mortar locations. These digital forces, however, are demanding unprecedented speed, efficiency, flexibility, innovation, and growth—and these forces require organizations to become masters at digital.

What does IDC say is the key to successful innovation?

Innovation cannot happen in a silo. IDC believes that the future of innovation is collaborative and that it will come in the form of industry clouds that enable competitive organizations to pool resources and share certain data. One use case they cited is in financial services, regarding regulation. Compliance is not a competitive advantage to any organization—in fact, it’s often a costly expense in terms of resources. If financial services companies are able to share data, resources, and best practices through industry clouds, they can accelerate innovation around their compliance measures and all benefit greatly.

Innovation = Code + Data

IDC believes that innovation requires two key components: code and data. You could have the best code in the world, but without data to run through it the code doesn’t matter. Likewise, you could horde petabytes of data in your systems, but without good code, you can do little innovation. According to IDC, we will see an uptick in organizations looking to third-party vendors to supply data they can use to drive innovation.

The missing ingredient in IDC’s formula is “quality.” If you’re expecting to drive innovation of any sort, data is essential—but quality data is even more essential. In fact, it would be short-sighted to believe that you could purchase third-party data, run it through your fancy code, and call that innovation. Before any data enters your systems, you’ll want to ensure that it is fit for purpose. Is the data current and accurate? Is it standardized to conform with your current data formats?Is it deduplicated? You get the idea.

Can you innovate with code and data alone? Certainly. But by ensuring your data is fit for purpose, you reach that point of innovation much more quickly and save time and money along the way. So if innovation is driven by code and data, then I would propose my own formula: Innovation = (Code + Data)Quality.

Embracing the DX economy

There’s no doubt that the digital economy is quickly approaching, and we as technology companies need to be prepared. By embracing new ways of thinking about how we do business, how our clients do business, and how our customers choose to shop, we can better enable ourselves to embrace the digital transformation that is happening. But we can’t do it alone. Industries will need to adopt cloud technologies to better collaborate and solve common problems. And we’ll need quality data to propel our innovations forward.

We help organizations like yours innovate every day. See how our data quality solutions can help you.

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