Any SMB company planning to use the cloud as an integral part of its IT infrastructure and looking to adopt emerging technologies such as the Internet of Things (IoT) and artificial intelligence (AI) needs to be thinking about digital transformation. And, MSPs have a major role to play in helping customers plan, implement, and manage their digital transformation plans.
The MSP’s role starts with defining digital transformation for customers. Many probably have heard about it but likely have a murky idea of what it means. Googling the term doesn’t help because definitions tend to be opaque.
Simply put, digital transformation entails thoroughly assessing all existing IT assets to measure their effectiveness and determine what needs to be removed, replaced, upgraded, or added, in order to achieve desired business outcomes. IDC predicts worldwide spending on digital transformation is growing at about 18 percent annually and will reach $1.2 trillion this year and $2 trillion in 2020.
Why is digital transformation necessary? Here are four good reasons:
- Prepare for the Future
Digital transformation is about looking forward. Digitization drivers such as IoT and AI promise to transform business processes to make them more efficient, get products to market faster, and increase profitability. Any company that wants to remain relevant going forward cannot ignore these technology trends.
Worldwide spending on IoT is growing at about 17 percent yearly, according to IDC. In 2017, IoT spending will top $800 billion, and by 2021, it will approach $1.4 trillion. AI, meanwhile is expected to reach $12.5 billion in spending this year, a whopping 59 percent increase from 2016. IDC predicts AI spending will exceed $46 billion in 2020.
- Reach Business Goals
Digital transformation helps achieve important business outcomes such as driving operational efficiencies, getting products to market faster, and improving the customer experience. Getting all of a company’s digital assets to work in unison to achieve these goals is absolutely essential. Allowing different applications and systems to continue to reside in different silos without interoperability will prevent companies from maximizing the value of their digital assets.
- Define a Cloud Strategy
Many businesses have backed into the cloud as different departments make independent decisions to take advantage of a hosted solution or SaaS application. While this approach solves immediate problems, it can create long-term challenges if companies end up with multiple clouds for different functions without a clear strategy of how to make everything work together.
The use of multiple clouds is pretty much inevitable. That’s not the problem. The issue is leveraging clouds without some management strategy to create the needed interoperability that will help achieve a company’s digitization goals.
- Get a Competitive Edge
Businesses that achieve their digital transformation goals of refining business operations, getting products to market faster, and improving customer experience get a leg up on competitors. IDC has found that “ultra-connected” businesses — those that achieve the highest levels of interoperability and connectedness — outperform their competitors in a number of areas: increased revenue, lower operational costs, reduced time to market, and improved customer satisfaction.
Granted, IDC’s research focused on the enterprise, but there is no reason to believe SMBs would be any less successful in achieving business outcomes once they execute their digital transformation strategies.
In discussing digitization plans with customers, MSPs should make it clear that digital transformation is a necessary process to prepare for the connected future. It starts by embracing cloud technologies to drive efficiencies, scalability, and flexibility. Then, it continues by laying the groundwork for IoT, AI, as well as whatever emerging technology is coming down the pike. If you haven’t yet, start talking to customers today about digital transformation.
Neal Bradbury is Senior Director of Business Development for Intronis MSP Solutions by Barracuda, a provider of security and data protection solutions for managed services providers, where he is responsible for generating greater business value for the company’s MSP partner community and alliance partners.