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How service providers should select emerging technologies

How service providers should select emerging technologies

Surviving the digital storm requires technology service providers to make wise bets

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Robots at work

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In the face of client expectations around a rapidly changing array of emerging technologies, it’s important to focus investment, incubate talent and partner effectively to ensure digital solutions that deliver on their business outcomes.

Clients will continue to face rapidly accelerating technology innovation that will profoundly impact the way they deal with their workforces, customers and partners.

To survive and thrive in the digital economy, emerging technologies can help them create competitive advantage, generate value, overcome legal and regulatory hurdles, reduce operating costs and enable transformational business models.

According to a recent Gartner study, prescriptive/predictive analytics, machine/deep learning, virtual assistants and the Internet of Things were ranked by enterprise technology buyers as the top emerging technologies for competitive advantage until the end of 2022.

These enterprises have an expectation that technology service providers can speak to and have experience in the gamut of emerging technologies to support digital transformation.

This provides significant opportunities for your business to educate, advise and implement solutions leveraging these technologies.

Therefore, it’s important to make investments that help clients reinvent how they deliver value and create innovative business models to leapfrog their competitors, while future proofing their businesses against disruption.

This also means trying to achieve this in the context of a sometimes overwhelming competing resource allocation.

Don’t try to conquer the world

Pursuing every new technology by investing in a team to build uses in each market and industry may be an option.

However, moving the ship to obtain internal approvals, recruit or move staff, gain buy-in from across the enterprise and commence with building the knowledge and assets internally, is a herculean and likely untenable effort.

Doing so across multiple technologies at the pace that technology is emerging in today's market and at the speed and ease that clients are expecting, is a near impossibility for a large technology service provider, let alone a midsize or small service provider.

By the end of 2022, Gartner predicts that technology service providers that focus on and invest in digital services specific to one or two digital business sub-sectors will grow market share 25 percent faster than competitors addressing all sub-sectors.

Where to start

There are three key activities that are important when designing your emerging technology investment strategy:

- Focused investment: Determine a shortlist of emerging technology solutions for investment in developing intellectual property or solutions

- Ecosystem strategy: Research and decide on which vendors of target emerging technologies to partner

- Talent incubation: Create an incentivised centre of excellence to incubate skills, provide best practices, research and training

As you make investment decisions, the rate of adoption for emerging technologies is an important consideration when determining return on investment, talent and partnering approach.

These emerging technologies are changing the fundamental expectations, culture and behaviours of industries, markets and business functions.

While analytics, machine learning, IoT and virtual assistants are at the top of the five-year investment horizon for clients, other emerging technologies are gaining in adoption and importance by the day.

When selecting which emerging technologies will have the greatest impact on your clients’ businesses, understand their motivations related to each of these technologies.

Making wise bets to ensure a targeted investment approach that doesn’t leave room for missing out in areas that are the most important is challenging.

However, this challenge can be managed via a comprehensive ecosystem, platform and innovation investment approach.

Chrissy Healey is a research director in Gartner’s technology service provider group, advising IT service providers on market opportunities, go-to-market and differentiation strategies, and end-user organisations on innovation, sourcing and vendor management.


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