Why companies need to embrace emerging technologies
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The importance of technology to business strategy varies by the maturity level of the technology. And, right now, web and mobile tools remain at the core of digital efforts, while more advanced or emerging offerings -- such as machine learning (ML), artificial intelligence (AI), augmented reality (AR), and virtual reality (VR) -- remain off in the future as critical components, according to a new report from research firm Forrester.
The study, called The State Of Digital Business 2018: Top Technologies By Maturity, evaluates companies across three categories: Beginners in the early stages of their digital journey; intermediates that are already progressing toward a more fundamental business transformation; and advanced organizations that are most often using digital ecosystems to disrupt their markets.
Forrester surveyed 105 global senior technology executives online in 2017, and one of the key findings is that while 86 percent of advanced companies see technology as the most important driver of business strategy, less than half of the beginners think technology will affect their business strategy to the same extent.
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The report cites web, mobile, cloud, and data analytics as the most mature technologies, suggesting that for many organizations digital strategy equates to what they do on the web and via mobile devices and apps.
A majority of all the organizations in the study see their digital strategy as some incarnation of the web and mobile strategy. And while these technologies are important, the report said, digital leaders must not limit their thinking to just those technologies.
Although many of the organizations see foundational technology as important, few recognize the impact that emerging technology can have on future revenue. This "limiting perspective" of what it means to create a digital strategy will continue to constrain growth in less mature companies relative to their more mature counterparts, the report notes.
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As for more advanced technologies, while 44 percent of advanced companies see AI and ML as critical to their business strategy, just 27 percent of the beginner companies take the same view. Considering the complexity of building AI/ML into the business model, this isn't surprising. But it also suggests that when it comes to using these technologies to drive revenue growth, advanced organizations will have a significant advantage over less mature competitors.
Few companies view more emerging technologies -- such as AR, VR, automated voice interfaces and bots, location technologies, 3D printing, and radio frequency identification/near field communication -- as critical to their business, and use of some of these products remains mostly experimental.
These technologies "remain enablers of new outcomes in niche sectors and have yet to prove their worth for the majority of companies," the report said.
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"CEOs and CFOs have long been suspicious of CIOs' requests to 'experiment' with technology, preferring instead to see signs of a positive [return on investment] before investing. But this approach to tech investment is changing as innovative companies fund the types of continuous experimentation needed to unlock technology's capacity to deliver new customer value," the report added.
Unless business leaders are willing to invest in technology experimentation either internally or through acquisition, it will be difficult -- if not impossible -- for less mature companies to catch their more mature competitors, the study said.
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