Three Emerging Trends Driving Digital Business

The road to digital business starts with ubiquitous “smart” things that will range from contact lenses that measure blood glucose to complex industrial turbines that can predict a failed bearing before it happens.

This proliferation of devices is part of a “virtuous circle of smart things,” where falling costs inspire increased connectivity, leading to greater functionality, growing diversity (in the types of smart things) and then, rising ubiquity in the volume of smart things.

Steve Prentice, vice president and Gartner Fellow, highlights the confluence of three interrelated emerging trends that IT leaders should assess as they pursue digital business initiatives:

  • Democratization of Technology
  • The Physical and Digital Worlds Blur Leading to Dematerialization
  • Disintermediation


3 emerging trends

Trend No. 1 — Democratization of Technology

In this case, democratization is not about the types of people using technology. It’s not about access, Mr. Prentice says. It’s about technology starting to be on par with us. Everything is connected, everything has a voice, everything has a say.

He suggests that smart things will begin to control our behavior such as in how a smart thermostat dictates how much energy we consume and, thus, the bills we pay. Mr. Prentice provides several recommendations for IT leaders to leverage this coming democratization including re-examining their business models to use smart “things,” and looking for platforms to exploit data from “things.”

Trend No. 2 —Dematerialization

Mr. Prentice points out what happens when the number and diversity of devices grows rapidly and increasing familiarity leads us to no longer recognize them as “devices.”

The most profound technologies are those that disappear, Mr. Prentice says. They simply weave their way into the fabric of what we do.

He expects every product and service will go digital, creating vast quantities of data which may be more valuable than the products themselves. These include smart pills that monitor medication consumption and the new Adidas soccer ball that measures and advises on performance.

In this connected world of abundant information, Mr. Prentice fears that we may become defined by the data that exists about us. Organizations must straddle the tension of all the information available from smart things by balancing their desire to collect and analyze it with the risk of its loss or misuse.

Unfortunately, he adds, by breaking the link to the physical world, dematerialization can lead to disengagement and negative results such as cyber-bullying.

Trend No. 3 — Disintermediation

When the digital and physical merge, many existing business models and industries will be disrupted – some quite suddenly. Disintermediation will occur in experience, when smart machines replace trained people; in knowledge, when smart machines support cancer diagnoses or customer service, etc.; and in the value chain, when it’s possible for customers to go directly to the source.

IT leaders must understand that new technologies may be less disruptive than the new business models they enable and accept that the biggest disruptions will most likely arise from outside their industries. They must act quickly to explore the use of smart machines internally and track use by existing and potential competitors.

However, Mr. Prentice notes that despite these challenges, addressing these trends is worth it: digital business is set to add $1.9 trillion in value by 2020. CIOs and IT leaders have no choice but to pursue it.

A video replay from Mr. Prentice’s Gartner Symposium/ITxpo presentation, “The Emerging Trends Driving Digital Business” is available on Gartner Events on Demand.


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