Feature Articles

IDC Futurescapes 2017: A glimpse into the future

By Lionell Go Macahilig - 23 Feb 2017

DX Economy defined

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The dawn of a DX economy

What does DX economy mean? It is an economy wherein digital transformation grew to macroeconomic scale and it impacts the core of what industry leaders do and how they operate as a business. IDC is saying that the Philippines will see a DX economy for the first time this 2017. By 2020, 25% of the top 1,000 companies in the country will be assessed depending on their ability to come up with digitally enhanced services, products, and experiences.

What are some of the key drivers that facilitated the rise of a DX economy in the Philippines? First, the country has a rosy economic outlook. We’re expecting 6% annual GDP growth in the next five due to the opportunities brought about by regional integration and expanding middle class. Additionally, technology-centric transformation will increasingly play a major role in altering businesses and society. More and more enterprises are going to embrace mobility, social media, cloud, and analytics as important tools to become more competitive in the market, and consumers themselves will help in shaping these technologies as well. Data is becoming an important capital to come up with digitally enhanced services and this mean a new stream of income for these companies.

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IDC is also seeing that more and more companies are becoming digital natives. As newer generations of consumers are classified as digital natives, companies need to digitally transform key aspects of their business and these include leadership, operations, talent, relationship, acquisition, and information. Some of the leading brands in the Asia-Pacific region have already embraced these in a major way and one example of which is WeChat. WeChat is a largely Chinese phenomenon but its impact on the global market is starting to be seen and this is mainly because of its promise of a cashless economy or a cashless society. Today, WeChat has a base of 700 million users compared to WhatsApp which is just about a million. The comprehensive list of services available in WeChat makes this platform able to earn approximately USD 4-billion per year, 20x more of what WhatsApp has. Another brand, UnderArmour, has a comprehensive ecosystem of fitness products and according to its CEO, digitally enhanced biometric measurements and understanding oneself are some of the waves of the future. Local Motors, found in 2007, is the first company in the world to come up with a 3D printed car. It only took 44 hours for them to do the 3D printing and three days in forming the assembly. One of their latest innovations is Olli, a 3D printed van controlled by cognitive computing.

In the Philippines, many local organizations have also shared their digital transformation journey but mainly on the level of initiatives. By the year 2020, IDC is seeing more Filipino companies level up their DX journey as they recognize their ability to create digitally enhanced products and services and experiences will be very important in their success in the market. Any organization can be perceived as an emerging tech company and the Philippine economy will be reshaped in the process.