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Is Your Business Ready for the Digital Industrial Economy?

technology, future, jobs
The future of tech and how the Digital Industrial Economy will change business. / Credit: Circuit board image via Shutterstock

A new dawn is on the information technology (IT) horizon. The inevitable and heavy integration of mobile, social collaboration, cloud computing, the Internet of Things, Big Data and cybersecurity has ushered in a new technological era, analysts say. 

IT research and advisory firm Gartner recently held the Gartner Symposium/ITxpo in Orlando, Fla., where the company announced that the digital world has arrived, opening doors to a new era in technology: the Digital Industrial Economy.

Gartner analysts posit that in the Digital Industrial Economy, every company will become a technological company, every budget will become an IT budget and every business will become a digital leader. 

"Digitalization exposes every part of your business and its operations to these forces," Peter Sondergaard, senior vice president at Gartner and global head of research, said in a statement. "It is how you reach customers and constituents, how you run your physical plant and how you generate revenue or deliver services. Enterprises doing this today are setting themselves apart and will collectively lead the new Digital Industrial Economy."

Sondergaard said the Digital Industrial Economy is divided into three primary areas: 

The Internet of Things combines the physical world and the virtual world, creating a whole new economy for connected devices. In 2009, there were 2.5 billion connected devices with unique IP addresses, such as cellphones and PCs. By 2020, this number will skyrocket to 30 billion connected devices with unique IP addresses, most of which will be products other than cell phones and PCs, such as wearable tech, according to Gartner.

[8 Ways the Internet of Things Will Change the Way We Work]

"Computing power will be cheap and covert," Sondergaard said. "We won't know it is there; it will be in our jewelry and in our clothing. We will throw more computers into our laundry in a week than we've used in our lifetimes so far."  

Furthermore, these connected devices will reach a value of $1.9 trillion in 2020, benefiting all types of industries, from health care to retail and transportation. IoT revenue in the technology and telecommunications sectors will also exceed $309 billion by 2020, Sondergaard said.

Mobile technology will play an even larger role in the Digital Industrial Economy, as mobile is now the destination platform for all applications, Sondergaard said. By 2017, mobile phones, tablets and ultramobile PCs will represent more than 80 percent of device spending, and half of first-time computer purchases will be tablets

The Digital Industrial Economy is shifting the IT vendor landscape, where competition will be central to the vendor-chief information officer (CIO) ecosystem. Whereas top technology companies led the industry in the past, they will struggle to maintain their foothold as cloud and mobile startups are poised to fill new business technology needs.

"What many traditional IT vendors sold you in the past is often not what you need for the digital future," Sondergaard said. "Their channel strategy, sales force and partner ecosystem is challenged by different competitors, new buying centers and changed customer business models. Digitalization creates an accelerated technology-driven startup environment across the globe. Many of the vendors who are on top today — such as Cisco, Oracle and Microsoft — may not be leaders in the Digital Industrial Economy." 

The interconnectedness of everything will produce unprecedented amounts of data. In addition to the implementation of strategies that will effectively harness, analyze and interpret this information, cybersecurity will become even more important to keep such valuable data safe in the Digital Industrial Economy. 

"The security of embedded technologies that your organization has right now may be the most important operational responsibility you will have in 2020," Sondergaard said. "Digitalization will create new infrastructures and new vulnerabilities in our infrastructures. We recommend that you build a portfolio of security vendors because no single vendor addresses more than a fraction of your problem. Everyone will need to establish more agile security processes."

Sara Angeles

Sara is a Los Angeles-based tech writer for Business.com, Business News Daily and Tom's IT Pro. A graduate of the University of California, Irvine, she has worked as a freelance writer and copywriter for tech publications, lifestyle brands and nonprofit organizations in the Southern California area and throughout the U.S. Sara joined the Purch team in 2013.