Digital adoption alone is no longer enough to achieve business goals and drive profits, according to research from the Infosys Knowledge Institute (IKI), the thought leadership and research arm of Infosys.
The study, Infosys Digital Radar 2022, found that companies must now use digital to differentiate themselves beyond traditional IT metrics, reaffirming the importance of people-centric transformation and ESG (environmental, social and governance) to succeed in business.
Improving average processing efficiency has the potential to unlock $357 billion in additional profits worldwide, according to the study. While digital adoption and ESG orientation would individually generate benefits, they would be more effective when deployed together, according to the research.
As technology adoption rates skyrocketed during the pandemic, the study also indicated a point of diminishing returns for companies with high levels of adoption. In fact, companies with above-average adoption rates generated slightly lower earnings growth than those with lower adoption rates, while those with average rates generated the most. The data from the study suggests that mere adoption was not enough, what matters most was how effectively companies use their technology, he found.
Salil Parekh, CEO of Infosys, said, “The widespread disruption from COVID-19 and the resulting digital acceleration has permanently altered the way the world views technology. While some companies have seen this as an opportunity to go beyond questions of whether and how far to digitize, some have still not realized the need to use these digital tools to engage their stakeholders in a more targeted way. and respond to calls to serve people, planet, and community.
The survey assessed the digital transformation efforts of various companies on a Digital Maturity Index and found that companies have been gradually adopting the technology year over year. For example: the adoption of technologies in the healthcare sector has increased from 60% to 98% since 2019, the adoption rate for the manufacturing sector has increased from 81% to 97%, while for the financial sector, it rose from 59% to 94% over the same period. period.
Where companies once reached a “digital ceiling,” unable to reach the most advanced levels of technology adoption, these adoption thresholds would become the minimum standard, he observed.
Some 2,700 digital transformation leaders of advanced digital enterprises from multiple geographies, including India, participated in the study.