Customer Experience And Cyber Driving Technology Innovation And Digital Investment

KPMG International has published its ‘KPMG Global Tech Report 2023’ which explores the technology strategies employed by organizations across the globe as they embark on the next stage of their digital transformation journeys. It also examines the opportunity presented by emerging technology to drive value and gain a competitive edge during a sustained period of unprecedented market volatility.

According to the new report — which surveyed more than 2,100 technology executives and conducted a series of in-depth discussions — digital transformation leaders committed to their innovation priorities continue to realize value at pace.

The largest group of respondents see technology investment driving profit or performance improvements of more than 10 per cent, up from last year’s most common rate of improvement of around 2.5 per cent. Buy-in across leadership for the deployment of emerging tools and technologies has more than tripled, with the top three areas of investment being artificial intelligence, data and analytics and Xaas.

Almost half of respondents (48 per cent) agree that advancing their ESG priorities will be a primary innovation goal for their technology functions over the next two years. This is consistent regionally with 53 per cent in ASPAC, 46 per cent in the Americas and 47 per cent in EMA.

“The report reveals customer experience, ESG and cyber security are considered key drivers for technology innovation, and increasing focus on AI as the driving force behind digital transformation ambitions in the next few years. With a revolution of emerging technology unfolding before us, organizations should ensure their digital innovation plans are intentionally tied to their strategic commercial goals”, says Bobby Soni, Global Technology Consulting Leader, KPMG International.

Commenting on the report’s findings, Sachin Arora, Partner and Head at Lighthouse (Data, AI & Analytics), KPMG India, states, “The ascent of AI and emerging tech is revolutionizing industries, yet it’s vital to remember that diversity and ESG principles must guide this transformation. Only by inclusively navigating these innovations can we truly unlock their potential while mitigating risks.”

Among those leading businesses where investment in technology is driving confidence and profitability most quickly, AI and machine learning are even bigger priorities. More than two thirds (68 per cent) say these technologies will be vital in helping them to achieve their short-term business goals, compared with 57 per cent of the total sample.

The report shows that ‘security by design’ is becoming an embedded principle in technology implementation: 62 per cent of businesses have discovered that managing risk in the early stages of projects, with security and control by design, significantly increases the success rates of transformation programmes. In some countries, this figure is far higher: 74 per cent in Brazil, 83 per cent in China and 88 per cent in India.

But it is not all plain sailing. The biggest threat to many organizations’ digital transformation ambition is linked to poor collaboration across teams – often a result of negative work culture and poor communication. Nine in ten respondents think collaboration with the wider business would be stronger if their tech function was more diverse.

This year, 96 per cent of the leaders (the top 15 per cent of those surveyed) say their technology function can help the enterprise to confidently explore the potential of emerging technologies, compared with 81 per cent of businesses overall. Two-thirds of these leaders have reached at least the implementation stage on projects connected to emerging technologies, XaaS, data and analytics and AI and automation, compared with less than half of the total respondent base.

With 72 per cent of digital leaders recording improvements in employee productivity from digital transformation, compared with only 48 per cent of other businesses, the potential benefits are huge. 71 per cent say they have enhanced customer engagement, compared with 49 per cent.

Today’s challenging times demand innovation tied to clear business outcomes, carefully monitored for bottomline returns. Opportunities exist for agile businesses that are able to adjust at speed and respond to internal drivers as well as the changing environment around them to optimize outcomes and achieve a competitive advantage.