Digital Operations: A Driver for Business Resilience

When unexpected and unforeseen challenges arise, businesses that adapt quickest and best come out ahead of the pack. It necessitates shifting manual labor to digital operations. This is more than just competition with material rewards. The COVID-19 pandemic has brought unforeseen and massive disruption to the way people and businesses interact. It is a fight for survival—both for businesses and for the people who make up their markets, and the workforce.

Resilience is the key to adaptation. It encompasses a pivot around which humans, their communities, and the businesses they interact with. Ultimately, it entails building a better future and a stronger world.

The Future of Operations (FoO) is marked by resilient decision making. It requires having the ability to use all available data, turning it into information and then into action. Furthermore, it includes facilitating rapid and effective decision making and connecting traditional and digital operations. Finally, it demands alignment with customer requirements. Customer requirements now are much more urgent. Examples are seamless and quick service and product delivery and contactless and frictionless transactions. However, they are also mindful of interactions that keep them safe from the spread of disease. But of course, companies also need to pay attention to the needs that don’t stop existing.

Mixed impact, dramatic shift to digital operations

According to the latest analyses by IDC on the effects of the pandemic, COVID-19 “has had a mixed impact on the enterprise networking market”. While most companies report downward pressure on their IT budgets, supporting a suddenly remote workforce and enabling contactless operations has “created new demand for network capabilities”.

This report quotes IDC Vice President for Network Infrastructure, Rohit Mehra. He said, “the novel coronavirus has forced enterprises across the globe to rapidly and dramatically shift their operations”. He added that “in doing so, enterprises are relying more heavily on networking technology, from enabling secure connectivity to supporting increased demand for collaboration platforms”.

IDC’s network infrastructure team fielded a study of U.S.-based enterprise networking leaders and decision-makers in May and June of 2020 to assess the impact of COVID-19 there and collect quantitative data on future spending habits. This team found that enterprises reported, “planned increased investments in unified communications and collaboration (UC&C) tools, network management, and datacenter networking since the pandemic began.” Study respondents also reported “decreased spending in the enterprise campus and wide area networking.”

The study found that “almost half of the respondents (48%) reported they will be increasing investments in UC&C tools, compared to 32% reporting increased investments in datacenter networking, and 31% increasing investments in network management.”

The research team also found that “more than half of respondents (51%) reported that employees cannot access applications from their home internet connection multiple times a week. A majority of respondents said employees do not primarily use a virtual private network (VPN) while working from home.”

Customization

According to another report published in May, IDC found an “increasing demand for more custom products and experiences”. Thus, it is “requiring operational leaders to build operational capabilities that can consistently respond rapidly to market and demand signals”.

These operational leaders now need “to pivot their organizations”. They must focus on promoting and ensuring market-driven responsiveness with the continued focus on throughput and efficiency. Based on this, IDC predicted that “by 2022, 80% of all industrial companies will have merged operational data streams with enterprise data streams to support broader and more rapid operational innovation.”

IDC published a new FoO framework, one that quotes group vice president of Manufacturing and Energy Insights Kevin Prouty. “Digital engineering is the piece that companies have been missing that brings together OT subject matter expertise with digital capabilities”, he asserted. He added that it enables enterprises “to manage and gain insights from the operational data stream and associated model”.

“It is through enabling this data that organizations will be able to be more resilient and to tightly align operations with their customers’ needs,” Prouty said. “The convergence of IT and OT is the driving force behind digital engineering and the resiliency at its core.”

Required response

IDC Associate Vice President for IDC Energy Insights and Manufacturing Insights Emilie Ditton noted that “the requirement for enterprises to respond to the COVID-19 health crisis has highlighted how critical resiliency within operational strategies”.

Companies who have made investments in key elements of instrumentation, infrastructure, integration, and insight and can use those to pivot on insights on a consistent basis across their operations will be in the best position to respond.”

In April, IDC’s new FoO framework predicted that, by 2025, “intelligent enterprises will see 100% increase in productivity”. As a result, response time would be halved due to an ability to anticipate market and operational changes. Moreover, there would be a 25% increase in success rates of new product introductions.

Without a doubt, change has arrived. Therefore, businesses need resilience and adaptation on their side now in this time of make or break.

Does your organization possess an exemplified ability to make business operations more responsive and effective? You might be the next Operating Model Master.