85% UAE, KSA businesses feel threatened by digital start-ups

Eighty-five per cent of businesses believe digital start-ups will pose a threat to their organization, either now or in the future, according to new research from Dell Technologies. This phenomenon is propelling innovative companies forward and accelerating the demise of others. Almost half (45%) of businesses surveyed fear they may become obsolete in the next three to five years due to competition from digital-born start-ups.

Some companies are feeling badly bruised by the pace of change. More than half (54%) of business leaders have experienced significant disruption in their industries over the past three years as a result of digital technologies and the Internet of Everything, and 44% of businesses don’t know what their industry will look like in three years’ time.

The findings result from an independent survey by Vanson Bourne of 4,000 business leaders — from mid-size to large enterprises — across 16 countries and 12 industries including UAE and Saudi Arabia

Patchy Progress or Digital Crisis looming?

Some companies have barely started their digital transformation. Many have taken a piecemeal approach. Only a small minority have almost completed their digital transformation. Only 7% of businesses surveyed are performing critical digital business attributes* well. While only parts of many businesses are thinking and acting digitally, the vast majority (71%) admits digital transformation could be more widespread throughout their organization.

Nearly two-thirds (63%) confess to not acting on intelligence in real-time. Only 41% of businesses reported to meet customers top demand for better security, while only 46% of businesses said they can meet the demand for 24/7 faster access to services and information

Dell Technologies’ Digital Transformation Index supplements the research and rates companies based on respondents’ perceived performance about their firms’ digital transformation. According to the benchmark, only 4% of businesses in UAE and Saudi Arabia have catapulted themselves into the Digital Leaders group

1.        Digital Leaders:       4% – digital transformation, in its various forms, is ingrained in the DNA of the business

2.        Digital Adopters: 13% – have a mature digital plan, investments and innovations in place

3.        Digital Evaluators: 35% – cautiously and gradually embracing digital transformation, planning and investing for the future

4.        Digital Followers: 37% – very few digital investments; tentatively starting to plan for the future

5.        Digital Laggards: 11% – do not have a digital plan, limited initiatives and investments in place

Digital Rescue Plan

Given the acute threat of disruption, businesses are starting to escalate a remedy. To advance their digital transformation:

•          73% agree they need to prioritize a centralized technology strategy for their business

•          64% are planning to invest in IT infrastructure and digital skills leadership

•          69% are expanding their software development capabilities

In order of priority according to respondents, the top planned IT investments over the next three years are:

Internet of Things technologies- 43%

Ultra-high performance technologies (Example: Flash) – 42%

Analytics, big data and data processing (Example: Data Lakes) – 42%

Next Generate Mobile Apps – -41%

“We’re in the midst of the next industrial revolution that will fundamentally alter the way we live, work and relate to one another. This shift will transform the way every business in every industry operates. We are already witnessing a transformation of business priorities as both public and private sector entities across this vast region continue to invest in advanced new technologies to better meet changing customer needs and expectations. In the near future, almost every business will have software development expertise at its core.

“Many of these companies will be brand new; others – having not written a line of code in 20 years – will have been on a momentous journey. New digital products and services will drive the transformation of IT infrastructure as businesses struggle to manage 1000x more users and 1000x more data. We believe that this monumental change is rich with opportunity, and we see ourselves as the transformational catalyst, and partner, for our customers,” said Mohammed Amin, Senior Vice President, Turkey, Eastern Europe, Africa and Middle East at Dell EMC.