5 Digital Transformation Trends That Could Impact Your Network
By: Tom Banta on March 24, 2020
Digital transformation remains a key goal for many organizations today, driving them to fundamentally shift the ways they think about their network infrastructure and the services they offer to customers. As the next decade unfolds, these changes will fundamentally reshape the way most businesses operate and how consumers engage with them in the market.
So what is a digital transformation? Broadly speaking, it refers to the utilization of disparate, digital technologies to create or modify business processes to better meet the changing expectations of customers. There are a number of ways in which companies have pursued a digital transformation strategy, but it may be more insightful to think about the trends that are driving these changes.
5 Digital Transformation Trends That Could Impact Your Network
1. Seamless Customer Experience
Today’s customers expect frictionless interactions when they utilize network based services. They want to be able to access those services wherever they are and want them to be consistent across multiple channels. If they interact with a company through a mobile application, they expect their information, preferences, and decisions to carry over when they log in through a web portal or call in using a conventional phone. The days of compartmentalizing different elements of the network services are long gone. Today’s customers view a company’s services as part of a cohesive whole and have little patience for any system that creates any inconvenience.
Providing this seamless experience is an immense challenge for companies as their systems become increasingly complex. Understanding the expectations and needs of their customers is critical to their sustained growth and success, however. Research indicates that 80-90 percent of companies will compete primarily on the basis of customer experience in the 2020s. Making the investments to provide a quality customer experience is almost as critical as creating the products and services consumers are demanding. With so many choices available to them in today’s crowded market, customers will continue to turn to the brands that make using their services simple and intuitive in 2020.
2. Data Rules Everything
Data is the engine behind every organization’s digital transformation strategy. Companies that are better able to gather and analyze data have a more accurate view of what’s actually happening with their business and where they need to improve. Those improvements could come from streamlining operations, iterating new products and services more quickly, and creating better customer experiences. Thanks to Internet of Things (IoT) devices, social media, multiple customer journey touchpoints, and edge computing applications, companies are able to collect more data than ever before, which has caused many of them to expand new storage and compute solutions that allow them to manage, process and secure all that information.
Unfortunately, much of this data is unstructured and requires powerful analytics tools to identify the notable trends and insights among the noise. Many organizations have turned to powerful cloud computing platforms to provide the processing horsepower that these machine-learning algorithms require, but data security demands have often required them to build more integrated hybrid IT platforms to do so. The most successful companies in 2020 will be the ones capable of building Hybrid IT platforms that provide maximum data flexibility and availability without compromising the security that their customers (and compliance standards) rightfully expect.
3. AI Takes Over (Sort of)
As organizations struggle to manage their increasingly complex Hybrid IT systems and IT infrastructure, artificial intelligence (AI) applications will play a much greater role in automating core functions and helping their operations to cycle faster. Whether it’s chatbots taking over a larger percentage of customer interactions, pick-and-place robots streamlining warehouse operations, or machine learning financial algorithms that can automate the loan approval and fraud detection process, finding ways to implement AI across a range of business practices is going to be essential for companies hoping to keep pace in today’s digital-first economy.
It should come as no surprise, then, that organizations are investing more than ever into AI and machine-learning technology. According to IDC research, AI spending is expected to reach $46 billion in 2020, up a staggering 768 percent from 2016. While most industries are a long way away from being completely automated, there’s no question that AI and machine learning will continue to play a more central role in the way organizations deliver products and services and guide consumers through the customer journey.
4. “Everything” as a Service
As cloud computing platforms continue to expand, more organizations are shifting away from just their own in-house infrastructure and product-based software and toward a more scalable, flexible solution. While software-as-a-service (SaaS) has become a common feature of IT portfolios, the next few years will likely see companies embrace a true digital business transformation by turning to more cloud based service solutions for all of their IT needs. Thanks to the direct cloud on-ramps available in colocation data centers, organizations can access a variety of cloud-based services that greatly enhance their capabilities without crushing their budgets and improve IT agility.
Just a few examples of these cloud-based services include:
Disaster Recovery-as-a-Service (DRaaS): Backup, redundancy, and risk mitigation for mission-critical systems.
Cybersecurity-as-a-Service (CSaaS): Support, training, and tools for combating the latest cyberthreats.
Network-as-a-Service (NaaS): Network functionality with scalable port capacity.
Data-as-a-Service (DaaS): Data management solutions for storing, integrating, and processing data sets.
Understanding which “as-a-Service” solutions can address business needs will be critical for organizations looking to grow quickly and adapt to changing market conditions in the coming decade.
5. Colocated Infrastructure
The days of hosting all of a company’s essential network systems in an inefficient server room with limited connectivity are quickly coming to an end. Today’s organizations need to build their network systems on a reliable and energy-efficient infrastructure that will allow them to deliver services effectively, minimize costly downtime, and scale operations with demand. While migrating their entire IT stack into the cloud may be viable for some companies, many others can’t afford to give up control or visibility over their essential systems and data.
Colocation data centers provide an attractive alternative for any company looking to shift its CapEx IT outlays into more manageable OpEx items. Migrating servers into a carrier-neutral data center not only provides them with access to more reliable infrastructure and superior security, but also opens up a world of connectivity options thanks to a plethora of lightning-fast cross-connections and direct on-ramps to the leading cloud services. Partnering with a colocation provider gives even the smallest organizations access to the rock-solid IT infrastructure that was once only available to major enterprises.
As companies move into the new decade, they will continue to be under tremendous market pressure to complete their digital business transformation. With more and more services being facilitated through their networks and even physical products relying on digitally-enabled infrastructure to reach consumers, it’s paramount for organizations to think about how they can capitalize on digital transformation trends if they want to continue to grow their business in an increasingly competitive environment.
About Tom Banta
Tom is the Senior Vice President of Product Management & Development at vXchnge. Tom is responsible for the company’s product strategy and development.