Associate Research Director, Telecom, IoT and Enterprise ICT, IDC Asia/Pacific
With a global recession on the horizon, the general consumer's response is "save more, spend less."
It is tempting for businesses to do the same — cut costs and shelve business expansion plans. Some may even be thinking of consolidating all their resources and efforts into one area.
But moving from crisis to recovery amid a Black Swan event like the current global pandemic, as well as other unexpected events, calls on businesses to evaluate the effectiveness of traditional cost cutting as a way to ride out the storm.
Surviving a recession in this digital decade is no longer about simply cutting costs faster and deeper. As IDC's research and our own Future Ready Report show, technology can help to flatten the curve.
So where are Asia/Pacific organisations on this recovery journey?
As this piece is published, the latest IDC COVID-19 Impact Survey (June 2020) shows that 35% of the 314 Asia/Pacific respondent organisations are in the "return to growth" stage (stage 4), that is they have already started on their recovery journey to the next normal.
A quarter (26%) are still in the "recession" stage (stage 3), focused on building digital resiliency to drive profitability during the ongoing recession.
The "Future Enterprise"
Businesses that do not push forward with their digital transformation plans risk falling behind.
IDC’s vision of the “Future Enterprise” is an organisation that is completely digitally transformed. Such an organisation underpins business processes with technology, is fueled by innovation, and is platform-enabled and ecosystem-centric.
The transformation to the “Future Enterprise” throws the spotlight on cloud, which plays a central role and requires transformation of the enterprise network as well.
As organisations begin to realise the critical role of software-defined solutions in the cloud-enabled world, they must not underestimate the importance of the underlying enterprise networks – whether Ethernet, MPLS IP VPN, or the public internet – in their transformation journey.
To compete in today's challenging environment, businesses will need to pivot away from digital for the sake of innovation, to digital for the sake of business continuity, and build out digital resilience.
A solid foundation
A robust enterprise network environment is the foundation of this digital resilience – and like the foundation of a house, it determines how well other technology initiatives built on top of it, deliver on their promise.
As a result, businesses across a spectrum of industries are investing in transforming their enterprise networks. While audit and compliance related requirements are driving network investments in the finance industry, digitisation of assets and workloads is driving the same in the manufacturing space.
Given the pivotal role of the supply chain in the modern digital economy, organisations in logistics are focusing on network initiatives to transform their role from a “cost center” to an "opportunity driver," while over-the-top (OTT) content providers are investing in networks to meet the continually evolving demands of today's consumers.
In our recently launched IDC Executive Brief, sponsored by Ciena and Vodafone, on A Digital-Native Network: Accelerating the Transformation of Asia/Pacific Enterprises, we deep-dived into various industry use cases of Ethernet in action, outlining challenges and considerations.
However, in IDC's COVID-19 research (June edition), only 34% of the Asia/Pacific organisations surveyed believe that their enterprise networks are well prepared to help them get the most out of their investments in cloud computing, remote collaboration, videoconferencing, and virtual workspaces.
That leaves about two-thirds lacking confidence in their current network, which is somewhat worrying.
Which group do you fall under? Is your network ready for this digital decade or does it lack the security, resilience, and performance to meet the ever-increasing demands of connectivity and the business?
If you don't have answers to these questions yet, it is high time to ask them out loud.
This article was written by International Data Corporation (IDC), a globally respected industry analyst organisation specialising in market intelligence and advisory services for information technology and telecommunications.
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