The latest Worldwide Semiannual Digital Transformation Spending Guide released by the International Data Corporation (IDC) shows that companies around the world are making major investments in technologies and services that enable the digital transformation (DX) of their business models, products and services. Global DX spending is forecast to reach USD 1.18 trillion in 2019, an increase of 17.9 percent over 2018.
Over the next four years, DX technology investments are expected to exceed USD 6 trillion, according to IDC program vice president Eileen Smith. “Strong DX technology investment growth is forecast across all sectors, ranging between 15 and 20 percent, with the financial sector forecast to be the fastest with a compound annual growth rate (CAGR) of 20.4 percent between 2017 and 2022.”
The industries that will invest the most in digital transformation in 2019 are discrete manufacturing (USD 221.6 billion) and process manufacturing (USD 124.5 billion). The top priority for DX spending for both industries will be smart manufacturing, followed by autonomic operations, manufacturing operations, and quality.
The next largest industry by DX investment in 2019 will be retail, followed closely by transportation and professional services, all of which will pursue a mix of priorities from omni-channel commerce to digital supply chain optimization and facility management.
DX use cases – efforts made to support a programme objective – that will see the largest investments in 2019 will be autonomic operations (USD 52 billion), robotic manufacturing (USD 45 billion), freight management (USD 41 billion), and root cause (USD 35 billion).
Other use cases with investments above USD 20 billion in 2019 will include self-healing assets and augmented maintenance, intelligent and predictive grid management for electricity, and quality and compliance.
“Digital transformation is quickly becoming the largest driver of new technology investments and projects among businesses,” said Craig Simpson, research manager with IDC’s Customer Insights & Analysis group. “It is already clear from our research that the businesses which have invested heavily in DX over the last 2-3 years are already reaping the rewards in terms of faster revenue growth and stronger net profits compared to businesses lagging in DX initiatives and investments.”
Geographically, the US and China will be the largest spenders in DX, with more than half of the total for 2019.