Modern time businesses require investments in digital innovation if they want to stay ahead of their competition. Innovation was always at the core of any successful business that wanted to remain relevant to its customer base and survive.
Advancements in information technology have made software ubiquitous in businesses, and thus innovation became digital. Digital innovation uses digital technology and applications to facilitate business processes, improve customer experience, create new products and business models.
Digital Innovation VS Digital Transformation
First, we need to distinguish between digital innovation and digital transformation. These two terms are often used interchangeably, but leaders need to know the difference between the two. They are indeed related, but they have more of a causal relationship than the same meaning.
For example, there are times that transformation may potentially lead to innovation, while the same is also true for the opposite. The significant difference between these two is the perception of time. Transformation is a long process of gradual change, while innovation is like a “eureka” moment that happens instantaneously. Subsequently, it is followed by its implementation to the business strategy.
Digital Innovation Disruptions
Many surveys have indicated that business leaders worldwide worry that their business will lose its competitive advantage due to rapid digital innovation.
Just think that the largest taxi company in the world does not even own a taxi fleet. Or even what happened to previously thriving analog photography companies that were replaced by smartphones.
Digital innovations happen everywhere and at a breakneck pace, especially after COVID-19. Therefore, it is imperative that businesses invest in R&D or that they adapt to new digital technologies.
Digital Transformation Trends for 2021
In the last couple of months of 2020, there has been tremendous digital transformation practically everywhere. Be it at work with the adoption of flexible working arrangements, at remote teaching in schools, or in businesses.
This crisis benefitted certain digital innovation trends, but some slowed down. However, there are specific trends that the new conditions will lead to their broader implementation in the coming year.
- 5G – Long anticipated, but this year, we understood the extra bandwidth’s real benefit with remote working. Businesses and users alike cannot afford to be disconnected.
- Cybersecurity – The pandemic saw a sharp increase in hacking activities to businesses worldwide. Namely, between January and April 2020, there was an increase of 238% in attacks on banks and 600% to cloud servers.
- Work from home – Work flexibility that was the only viable option during the imposed lockdowns will likely continue in 2021 to protect employees. The pandemic offered a testing ground for remote working, that otherwise, businesses were reluctant to try. The technologies that permitted remote working saw a boom during the pandemic and will gain more value and expand further.
- AI – It is already part of our daily lives, but the coronavirus triggered its acceleration. Scientists used Data analytics, AI, and machine learning used during the pandemic to analyze the virus and find a viable and faster solution. This created an ecosystem that allowed the better collaboration of different agencies and on a larger scale. It’s inevitable that AI will change the way we shop and how businesses market their products or services and focus on their customers.
Businesses now more than ever need to adapt to the constantly changing business landscape. Leaders have to formulate a strategy in their own companies to complete the digital transformation. The digital innovations are plenty, but businesses need to decide what and how to maximize the benefits.
The Institute of Entrepreneurship Development (iED) is committed to bringing the digital revolution a step closer. iED has successfully implemented European projects on Digital Innovation in the past and is looking forward to expanding even further in this domain. If you are also interested in Digital Innovation, do not hesitate to partner with us.