Fear of the death of ‘digital’

When we published our professional and IT services predictions for 2020, we anticipated feedback would center on the seemingly most controversial forecast: the end of “digital” as an industry catch-all term, nearly always followed by “transformation.” Initial comments from clients suggested we touched a bit of a nerve. We do not believe a possible economic downturn (also a 2020 prediction) would mean a return to analog IT. We ended 2019 with the expectation that one or more major IT services vendors or consultancies would drop “digital” from their go-to-market strategy and positioning, and we were surprised to be so right within the first two weeks of the new year (see: Accenture).

And earlier this week, we hosted a webinar on our predictions, and many of the questions centered on what the “demise of digital” really means, illuminating two likely fears in the market. The first fear is that an easy way to signal newness, creativity and up-to-speed technology ― just saying “digital” ― has fully lost its meaning, forcing marketers and IT services leaders to move from the vague and suggestive to something more concrete. While some leading consultancies and the more technology-centric IT services vendors may see this as a differentiating opportunity, other companies may struggle to find the right terms to project their competitiveness in a “digital”-free market. The second, and perhaps deeper, fear is that the change has been happening for long enough now that companies risk looking uncomfortably outdated, marketing themselves as “digital leaders,” when their clients have already begun looking for something truly new.

During the predictions webinar, my colleague Kelly Lesiczka noted how Fujitsu had initially launched Digital Transformation Centers, but then redirected its facility investment toward specific centers focused on emerging technologies, such as blockchain, security and AI, to more aggressively pursue opportunities in these areas. For example, Fujitsu strengthened its AI headcount in Canada and opened a Cyber Resilience Center in Canberra, Australia, in 2H19. If anything, “digital” stopped being useful as a term when every enterprise in every sector in every industry started calling themselves a “digital company.” And in 2020, the word is finally going to fade away completely.

What is the next catchy word or phrase, you may ask? We will leave this up to the marketers and their teams. What we do know is what enterprise buyers care about: As digital transformation programs mature, exploring new connection points made possible by data and emerging technologies helps businesses embark on more initiatives beyond discrete process areas. Vendors should take note of that and avoid relying solely on existing relationships, as buyers do not seem to view a past relationship as critical in vendor selection and are rather open to new ideas offered through integrated and coopetitive scale. Yes, in the end, we always come back to what all this means for the consultancies and IT services vendors.

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