This article highlights the top 10 digital transformation trends that will help businesses in Europe grow in this year of recovery.
After a recession, a prolonged period of improved business activity is considered a phase of economic recovery, and the general direction in which gross domestic product (GDP) grows is the shape of the recovery. With the need to adopt new ways of sustainability exacerbated by geopolitical tensions around the world, companies are looking for new ways to grow.
Service providers are helping customers by providing digital products and services, with faster delivery times, as well as guiding them in building their COVID-19 strategy and post-COVID-19 roadmaps. In Europe, companies are trying to recover from the multiple 2020 roadblocks that led to declining sales. Therefore, they are finding innovative ways to deliver services, mainly through digital media.
The key trends in Europe that will gain traction in 2021 and the areas where service providers can deliver value to their customers are:
Data-driven, analytics-based customer experience will be a priority
Customer experience has become a priority. Digitisation has redefined the customer experience, and business leaders are recognising the benefits of leveraging a data-driven approach, with the use of analytics, to improve the customer experience, and as a definitive roadmap for expanding the customer base. Analytics-based services help businesses assess the needs of their target customer base and deliver specific experiences, as well as manage inventory and supply chain, thus providing a differentiated customer experience.
The emergence of new online business models will drive growth
Growing in the post-COVID-19 world, new online business models – mainly using digital platforms and digital ecosystems – have emerged that complement existing business models or function as a completely new business. These models could be sector-specific or encompass multiple sectors, with a strong focus on customer centricity and profitability. While many companies have turned to online business models, the most adopted use case is video consultation by doctors. With restrictions on face-to-face interactions and diagnoses in many regions, this use case was widely adopted and accepted when the COVID-19 pandemic was at its peak in 2020.
Stronger focus on resilient supply chains by leveraging analytics
Supply chains faced extreme stress in 2020 due to movement restrictions. Redirecting supply chain networks, replacing local sources as required and using technology to manage supply chains have enabled companies to get back to business as usual. The use of analytics to forecast demand and manage supply has been an area of focus and is expected to gain traction with the help of automation as a supporting technology.
The growth of a flexible work culture will drive benefits for both employees and employers
Most companies provided flexible working models to employees to adhere to restrictions imposed by governments in response to the COVID-19 pandemic. Business units where digital technologies could be adopted to allow employees to work remotely made this change permanent or adopted a hybrid working model. While employers anticipated and achieved stable productivity at reduced costs, employees benefited in terms of work-life balance, reduced commuting time, and increased productivity. A study commissioned in the EU estimated that 40% of workers in the EU started teleworking because of the pandemic. Some professions may return to the old way of working on-site, but many prefer the hybrid work model. With many employees and employers successfully embracing the hybrid work culture, it is expected that this model will continue to realize benefits for both parties.
Remote talent management will be a key requirement
In Europe, most skilled workers in the financial services sector and some in manufacturing industries have switched to remote working and may continue with this working model in the new future. Managing and nurturing talent in a virtual world has created many opportunities for learning and development. However, the guidelines for remote talent management differ slightly from the physical world and will involve organisations fully embracing digital culture, as well as managing human connections, well-being and productivity. As digital workplaces increase the ability and flexibility to create virtual worlds, remote talent management will become crucial to business growth and employee retention.
Strong focus on building 5G infrastructure
With an increased focus on building connected services across all sectors, the need to deploy IoT edge devices has consequently increased, leading to a major focus on providing 5G services for end consumers. Towards the end of 2020, the EU has decided to spend a fifth of its €750 billion ($914 billion) recovery fund on improving digital capabilities. An increase in edge computing devices, connected homes and connected cities, along with a growth in the number of employees working from home are some of the factors driving demand for high bandwidth.
High continued focus on cybersecurity
The focus on IT security has increased dramatically and will be considered a top priority in 2021. It is imperative for businesses to secure their working environments and IT landscapes. A business survey presented in ISG Index 2020 Q3 identifies network security, fraud prevention, payment security, and web security as the top strategic challenges for organisations, with a significant talent gap expected in 2021. Therefore, recruiting a workforce with the required security skills and training the existing workforce to be resilient in the face of cyberattacks continue to be an area of focus for organisations.
AI will be seen as a complementary technology for diverse use cases
AI adoption has increased in recent years with this technology helping businesses generate positive results. AI has effectively integrated advanced technologies such as automation, IoT, data analytics, robotics, cloud, and chatbots. The impact of AI will be most experienced when it is leveraged as a complementary technology and not as a technology to replace an existing one.
Cloud and IoT will act as strong growth imperatives
With the COVID-19 pandemic, enterprises are moving applications to the cloud to increase the flexibility of business functions. This trend is expected to continue in the coming years. Implementing IoT to expand the services provided to customers and improve operational excellence is also an area of interest for many enterprises in Europe. Cloud and IoT have become important to businesses and by 2021, these two technologies are expected to be highly sought after as business growth imperatives in Europe.
Blockchain will increasingly be considered as a mainstream technology
There have been many sermons on the potential of blockchain and its implications in recent years. This year will be the time when the impact of blockchain applications will be realised by businesses. With many organisations and regulatory bodies realising the potential of blockchain and implementing it in different functional areas, it will be a mainstream application in the next couple of years: many organisations and business leaders realise the impact blockchain brings to the table, this technology is one of the most sought after emerging digital technologies.