Digital-first business leaders seek to apply pandemic lessons

Digital-first business leaders are planning to generate at least 50 per cent of their revenue from digital products, services and experiences by 2027, according to a study by market research company International Data Corporation (IDC).

For comparison, the market average for revenue generated from digital streams stands at 39 per cent.

“Driven by their experiences from the Covid-19 pandemic, these business leaders have changed how they think about the relationship between business and technology, and in how they approach the next digital transformation (DX) era – from scaling digital to running a viable digital business,” IDC found in its report titled ‘The Digital-First CEO: A Pathfinder for the Digital Business’.

According to the company, digital businesses create value when they use digital technology in four distinct ways.

This includes the automation of customer-facing processes and internal operations, as well as the provisioning and delivery of data-driven products, services and experiences.

It also involves multi-party orchestration of ecosystem collaboration, co-creation, and co-innovation.

Finally, digital businesses create value through the attraction, augmentation, and continuous development of a digital workforce.

“A new breed of digital-first CEOs has emerged,” IDC Chief Analyst and Digital Business Research Lead for the Asia-Pacific region Linus Lai said.

“We expect to see CEOs strategically use technology to compete and stay relevant to their customers, ecosystems, and employees, with the goal of increasing their digital share of revenue,” Lai added.

Moreover, according to the study, such business leaders in the Asia and Pacific regions are prioritising certain types of digital business models.

These include industry digital ecosystems (73 per cent of participants), as-a-service consumption (62 per cent) and a direct-to-consumer model which allows them to react to changes in how customers engage with digital services.

“For digital-first CEOs, the technology architecture is the business architecture,” IDC Associate Research Director for Digital Business research Lawrence Cheok said.

“These investments are aimed to better enable direct customer relationships, contextual on-demand services, joint value creation through digital ecosystems, and ultimately, a leading digital share of revenue,” Cheok concluded.