Global digital transformation investments tipped to reach $1.8tn in 2022 - IDC
The analyst predicts spending in EMEA will total almost $500bn
Global spending on the digital transformation (DX) of business practices, products, and organisations is forecast to reach $1.8trn in 2022, an increase of 17.6 per cent over 2021.
According to a new update to the IDC Worldwide Digital Transformation Spending Guide, DX spending will sustain this pace of growth over the 2022-2026 forecast period with a five-year compound annual growth rate (CAGR) of 16.6 per cent.
"IDC expects to see aggressive DX technology investment growth in 2022 following a minor slowdown during the pandemic period," said IDC senior research manager in customer insights & analysis, Craig Simpson.
"As organisations accelerate their pursuit of a digital-first strategy, they are channelling these investments into both internal operations and external direct engagement.
"The investments in internal operations are largely focused on improving efficiency and resilience while customer experience transformation has become a DX priority for many companies."
IDC's data found that operational investments stand out among the 51 strategic priorities included in the DX Spending Guide.
The DX priorities that will see the largest investment in 2022 include Back Office Support and Infrastructure, Smart Manufacturing, and Digital Supply Chain Optimization.
Together, these three investment areas will represent more than $620bn in DX spending this year, IDC claims.
Other operational priorities that will see significant investments in 2022 according to the firm's data include Connected Assets, Facility Management, and Operationalizing Data and Information.
Customer experience investments, such as Omni-Experience Engagement, and Omni-Channel Commerce, will account for more than $300bn in DX spending in 2022.
Nearly $469bn in EMEA
IDC pegged the US as the largest geographic market for DX spending in 2022, accounting for nearly 35 per cent of the worldwide total.
Western Europe will be the second largest region for DX spending, followed closely by China.
Digital transformation spending in EMEA will be nearly $469bn in 2022, a year on year rise of 16.7 per cent.
"In Central and Eastern Europe, the Russia-Ukraine war will delay investments for the current year impacting across many sectors, particularly the resource industry," said IDC senior research manager for European Industry Solutions, Customer Insights & Analysis, Angela Vacca.
"Supply chain disruptions will also impact some manufacturing and distribution segments while disruption of networking and IT supply chains will contribute to the postponement of some DX projects in the telecom industry."