The future course of global business is digital. But increasing obstructions to the flows of data, IT products, IT services and IT talent are jeopardizing the journey toward global digital business models. We call this process digital fragmentation.
The next phase of digital progress involves complexity that cannot be navigated alone. Find out the steps needed to rotate to the new.
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Barriers to globalization have been building for some time
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200 new protectionist measures in 31 countries (2014 to 2016) |
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1,000 protectionist measures introduced since 2008 |
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34 to 109 growth in the number of countries with data |
There will be winners and losers in a fragmented world that is subject to:
RISING COSTS
CIOs and CTOs expect the sourcing of inputs like IT talent to be the most important driver of cost increases due to digital fragmentation. It will also be costly to meet requirements to duplicate or multiply IT infrastructure, like data centers, and to comply with multiple national IT standards. 91% SAY RISING BARRIERS TO GLOBALIZATION WILL INCREASE IT COSTS IN THE NEXT THREE YEARS.
OPERATIONAL COMPLEXITY
CIOs and CTOs need to remain informed about new and upcoming legislation that will affect their global IT strategy. 51% ARE ALREADY REORGANIZING GLOBAL IT ARCHITECTURES DUE TO INCREASING BARRIERS TO GLOBALIZATION.
COMPROMISED CAPABILITIES
CIOs and CTOs see restrictions affecting several capabilities that are central to digital growth and innovation. Sales, marketing, and research and development all scored high as business functions vulnerable to obstructed global flows. 86% SAY IT STRATEGIES AND SYSTEMS ARE VULNERABLE TO INCREASING BARRIERS TO GLOBALIZATION.
CIOs AND CTOs
ARE WORRIED…
increasing barriers to globalization will be a problem for the IT function in the next three years
likely to exit a market, delay or abandon market-entry plans in the next 3 years due to increasing barriers to globalization
THEY ARE TAKING
ACTION BY…
increasing investment in automation to offset labor restrictions
discussing obstruction to global flows during strategic planning at board meetings
FOUR STEPS TO THRIVE AMID DIGITAL FRAGMENTATION
STRATEGIC
PLANNING
Boards must dedicate time to discuss implications of fragmentation across the business.
DE-RISK
DATA
Protect and reassess key information flows to optimize decision making and prevent disruption.
BUILD LOCAL
ADVANTAGE
Adopt IT strategies, processes and infrastructure that enable the organization to “be genuinely local” in all markets.
EMBRACE
TECHNOLOGY
Fully explore and exploit new technologies to navigate complex and evolving regulatory rules and legislation in relevant markets.
OMAR ABBOSH
Group Chief Executive,
Communications, Media & Technology,
Accenture
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ARMEN OVANESSOFF
Principal Director,
Accenture Research
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MARK PURDY
Managing Director,
Accenture Research
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PAUL NUNES
Global Managing Director,
Global Thought Leadership,
Accenture Research
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Accenture Research shapes trends and creates data-driven insights about the most pressing issues global organizations face. Combining the power of innovative research techniques with a deep understanding of our clients’ industries, our team of 250 researchers and analysts spans 23 countries and publishes hundreds of reports, articles and points of view every year. Our thought-provoking research—supported by proprietary data and partnerships with leading organizations such as MIT and Singularity—guides our innovations and allows us to transform theories and fresh ideas into real-world solutions for our clients.
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