Future of Digital Innovation

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The Future of Digital Innovation

We are entering the era of digital business, where enterprises increasingly rely on software to drive internal efficiencies, grow revenue, and achieve other strategic business outcomes.

As organizations build out their digital businesses, they must determine whether to develop software internally, buy off the shelf, or employ a hybrid approach. Ultimately, businesses must take a hard look across all of their product domains and adjust their technology investment strategies to drive sustainable growth and create competitive advantage.

Digital Innovation: A Framework for Success

By 2025, 750 million cloud-native applications will have been created globally, as enterprises increasingly leverage software innovation to drive internal efficiencies, grow revenue, and achieve other strategic business outcomes.

Software-driven products and services can help achieve important business goals, but when that software innovation becomes a value engine, it helps spawn new business opportunities, such as data monetization, new partnerships, and entrance into adjacent markets.

To create value engines, enterprises must build strong technology foundations that enable development teams to quickly and securely build – and iterate on – reliable software. They also need a culture of innovation – with support from the C-Suite. The digital innovation value engine is built on a strong innovation foundation that combinines vision, strategy, and culture.

The flywheel of innovation illustrates how companies can create the self-sustaining process – ideate, design, build, distribute, and measure – necessary to deliver innovative and iterative digital products and services that create and sustain new business.

Value

Innovative digital products and services should deliver value to the enterprise, which can take many forms depending on organizations and their competitive environments.

Invention

Successful digital innovation value engine supports ongoing, intentional invention at scale, an outcome that separates market leaders from the pack.

Differentiation

Takes the form of new capabilities accessible to customers or internal technologies that, for instance, boost efficiency and enable enterprises to operate at lower cost than competitors.

Disruption

Market disruption happens when an innovator offers a new approach that significantly impacts other players in the market and, potentially, in adjacent sectors. Digital innovation can also cause internal disruption to enterprises. While it can create challenges, internal disruption can open up new opportunities and provide enterprises with first-mover advantage in a hyper-competitive market.

While many organizations have already been transitioning from one-time purchase transactions to subscription-based services models, some are now taking the next step. Instead of selling "things" as a service, they're selling outcomes.

The concept is particularly top of mind for younger, digital-centric organizations. IDC found that nearly 40% of digital natives – companies founded after 2005 around a digital deliverable – are planning to shift to an outcomes-centric business model.

Technology vendors can help their customers navigate these business and pricing model changes by:

Anticipating Customer Needs

Vendors are well positioned to anticipate the types of challenges that their customers will face and offer solutions.

Sharing Best Practices

Vendors can share insights from similar customer efforts and offer some best practices.

Resources

Learn more about IDC’s Future of Digital Innovation research

How to Build a Value Engine for Sustainable Digital Innovation

 about How to Build a Value Engine for Sustainable Digital Innovation Read eBook

Should Your Organization Adopt an Outcomes-as-a-Service Model?

 about Should Your Organization Adopt an Outcomes-as-a-Service Model? Read eBook

Digital Innovation: The Enterprise Journey to Maturity

 about Digital Innovation: The Enterprise Journey to Maturity View Webinar

Best Enterprise Practices: Developing New Digital Offerings

 about Best Enterprise Practices: Developing New Digital Offerings Download Checklist

Leveraging Your Digital Assets for Competitive Advantage

 about Leveraging Your Digital Assets for Competitive Advantage Download eBook

Video: Learn how IDC can help you navigate the Future of Digital Innovation.

IDC Digital Innovation Awards Videos

eBook: Using Software Innovation to Ignite Business Value

 about eBook: Using Software Innovation to Ignite Business Value Download eBook

IDC Future of Digital Innovation Awards

 about IDC Future of Digital Innovation Awards Learn More

Research Programs and Custom Solutions

Future of Digital Innovation: Research Programs

IDC’s Future of Digital Innovation Agenda offers thought leadership and advice on key challenges organizations face when identifying and addressing digital innovation requirements for the digital enterprise.


Future of Digital Innovation Core Research programs provide business leaders with the insights and guidance needed to align technology investments with business strategy. Core Research programs include:


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Future of Digital Innovation: Custom Solutions

IDC’s Future of Digital Innovation research and custom offerings help you position your solutions to solve today’s complex customer challenges.


  • Custom Analytics – Identify opportunities to address customer requirements and challenges by segmenting the market using IDC’s Future of Digital Innovation framework
  • Thought Leadership – Amplify your message and become a trusted Future of Digital Innovation advisor and solution provider.
  • Business Value – Demonstrate customer and business value of your IT solution.
  • Sales Enablement – Sell more effectively and identify new monetization opportunities in partner ecosystems.

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