Deep Pockets and High Expectations
Rumors of the demise of digital transformation are just that: rumors. In reality, the market is healthy and strong. CAGR is forecast to reach 16.2% over the 2022-2027.
Written By: BOSS Editorial
Reading Time: 2 minutes
The State of Digital Transformation 2025
By Anne-Frances Hutchinson
Rumors of the demise of digital transformation are just that: rumors. In reality, the market is healthy and strong. CAGR is forecast to reach 16.2% over the 2022-2027. Experts are looking at DX as an ongoing priority and say that it could reach or even surpass two thirds of all Information and Communication Technology spending by 2027.
Digital transformation ranks among the top 3 IT initiatives, closely behind cybersecurity (76%) and cloud (75%).1
Who’s ponying up?
The heftiest investments in DX in the next two years will by made in the discrete manufacturing sector. Global spending will jump to more than $700 billion dollars in 2027. DX will support omni-experience engagement and sustainability, which are the top priorities for discrete manufacturers.2
Widening the net
Broadening digital access is the most transformative trend on the horizon. That connectivity will be used for:
- 86% AI and information processing
- 58% Robotics and automation
- 41% Energy generation, storage and distribution
- 60% of employers expect expanding digital access to transform their business by 2030. To get it done, they’ll need strong talent benches who have the three most in-demand skills: AI and big data, networks and cybersecurity and technological literacy.3
Look! It’s paying off!
- 56% of US executives have been impressed by the ROI for DX projects. In general, business leaders report that efforts have exceeded their expectations, especially for boosting employee productivity, cost-cutting, and improving customer engagement.
- 29% have seen performance gains of at least 11 percent from investments in data and analytics.
- Evidence suggests that companies that have leading digital and AI capabilities outperform laggards by two to six times on total shareholder returns across every sector!5
The goals that matter most
- 48% Advancing ESG priorities4
- 45% Enhancing trust through cyber threat detection and management
- 43% Reaching new regions and customer demographics
- 42% Improving processes across the business
- 40% Unlocking more value/insight from data
- 40% Improving products and services
- 32% Expanding into new industries
- 35% Improving customer experience6
But there’s always something…
Despite the rosy outlook, some very thorny pain points have left some companies struggling to get initiatives off the ground.7
- 24% Cyber threats
- 24% Meeting ESG goals
- 22% Skill shortages
- 22% Economic uncertainty
- 20% Regulatory implementation
- 20% Unsure leadership
- 17% Industry disruption
- 14% Geopolitical instability
- 14% Resistant organizational culture
Resources:
- https://assets.kpmg.com/content/dam/kpmgsites/xx/pdf/2023/09/kpmg-global-tech-report.pdf.coredownload.inline.pdf
- https://my.idc.com/getdoc.jsp?containerId=prUS52305724
- https://www.weforum.org/publications/the-future-of-jobs-report-2025/digest/
- https://assets.kpmg.com/content/dam/kpmgsites/xx/pdf/2023/09/kpmg-global-tech-report.pdf.coredownload.inline.pdf
- https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/rewired-and-running-ahead-digital-and-ai-leaders-are-leaving-the-rest-behind
- https://www.teksystems.com/en/insights/state-of-digital-transformation-2024
- https://go.veeam.com/ransomware-trends
