Organizations in India are set to witness a substantial surge in spending on digital technology in 2024, growing at twice the pace of the country’s overall economy, the latest IDC report said.
The driving force behind this robust growth in the spending on digital technology is the compelling need felt by companies to align with market demands, fostering digital business models, and fortifying their digital capabilities.
Despite prevailing economic challenges, enterprises view digital technology as a linchpin for sustainable growth. Market demands for digital experiences in products and services have accentuated the imperative to expand digital capabilities, prompting organizations to prioritize digital technology even in the face of inflationary and budgetary pressures.
IDC’s predictions indicate that organizations falling behind in digital technology adoption will accelerate their spending to maintain competitiveness. This trend has resulted in a notable upswing in digital technology spending, consistently outpacing the growth of the Gross Domestic Product (GDP) in recent years, a trend anticipated to persist through 2024.
According to IDC’s India Digital Business Survey for 2023, approximately 60 percent of Indian enterprises’ revenue is expected to be derived from digital business models within the next three years.
The escalating importance of digital disruption is underscored by its role in enhancing customer satisfaction, boosting revenue, and fostering innovation. IDC has outlined its top ten predictions for India’s digital business leaders, offering insights into the transformative landscape:
Leading Organizational Change in Response to Technology Change: CEOs are expected to play a pivotal role in steering organizational changes, emphasizing investments in digital-first initiatives to meet digital revenue targets.
Fostering Digital Business Platforms: Organizations are advised to adopt a platform-based approach to scale transformation initiatives, leveraging prior technology investments for a competitive edge in the digital business era.
AI Everywhere Will Supercharge New Digital Business Models: The integration of predictive AI, machine vision, and GenAI capabilities will create opportunities for new products and services, with a focus on delivering on-demand services through digital ecosystems.
GenAI Will Be Used to Innovate: GenAI will play a central role in co-developing digital products and services, enabling digital-native businesses to efficiently roll out new revenue-generating endeavors.
CIOs Become Central to Sustainability Initiatives: Chief Information Officers (CIOs) will occupy a unique position at the intersection of technological innovation and sustainability initiatives, allocating a significant portion of digital tech spending toward sustainability.
Measuring Success Will Require New KPIs: New Key Performance Indicators (KPIs) reflecting the creation and delivery of digital products, services, and experiences will become critical for strategic decision-making.
AI Will Impact Workflows and Drive Employee Reskilling: Widespread AI adoption will necessitate employee reskilling to align with changed workflows, with a focus on building talent, experience, and training data tailored to business needs.
Elevating the Role of Chief AI Officer to the C-Suite: The rise of generative AI emphasizes the need for a Chief AI Officer at the C-suite level, providing directive and authoritative leadership to drive transformative AI initiatives.
“To navigate the digital future, CEOs must lead significant organizational transformation with a focus on digital initiatives for sustainable growth. The rise of the Chief AI Officer underscores the pivotal role of AI leadership in bringing about transformative shifts at the highest executive levels,” Neha Gupta, Senior Research Manager at IDC India, said.
Sharath Srinivasamurthy, AVP, Research Group at IDC India, noted that the predictions align with the changing trajectory for enterprises and CXOs, adapting to rapid changes in technology and business models. “CIOs’ and technology leaders’ primary function will shift towards investing in digital-first initiatives to deliver on digital revenue targets.”
