Gartner: 10 Ways Digital Business and Mobility Will Change IT By 2020

Looking Ahead

Mobile devices and applications are becoming more advanced and intuitive, affecting how business is done everywhere from retail to health care, according to an Oct. 4 research note from Gartner.

The technology research firm expects machines to soon be capable of everything from conceiving of algorithms to launch a business to deciding on a back-to-school backpack to reducing the cost of diabetic care by 10 percent.

These innovations with eliminate the need for many lower-skilled jobs, Gartner predicts, but will level the playing field for startups and allow consumers to complete tasks more efficiently and effectively.

Businesses Will Need To Spend On Hiring Employees With Higher Competencies

Gartner expects social media and mobile technology to significantly change how people go about their daily lives.

For example, a traditional trip to the supermarket could be replaced with refrigerators that order groceries, robots that collect groceries, and drones that deliver groceries to the home, eliminating the need for cashiers and delivery drivers.

As a result, businesses in all industries will need employees with higher competencies. The transition will be painful, though, in the short run; Gartner expects half of digital transformation initiatives to be unmanageable by the end of 2015 due to a lack of portfolio management skills.

Computer Algorithm Will Fuel Launch Of Significant Digital Business

Entrepreneurs everywhere are looking to follow in the footsteps of Uber and Airbnb and use technology to disrupt longstanding industries.

Shared economy companies tend to form natural monopolies since their value increases with each new participant, Gartner said, but are amendable to computational analysis due to complex regulatory and market dynamics.

Investors are very attracted to these companies due to the potential upside of creating tens or hundreds of billions of dollars of wealth within a half-decade.

Gartner, therefore, expects the highest-value initial public offerings over the next 12 months to come from companies that fuse physical logistics with digital markets to challenge legacy industries.

Smart Machines, Industrialized Services Will Reduce Business Operations Costs

Business operations are shifting from a labor-driven and technology-enabled model to a digital-driven and human-enabled one, allowing consumers to get faster, cheaper and better products and services.

Smart machines will be used to add velocity to business operations, displace complacency and inefficiency, Gartner said, with humans continuing to steer the ship and interpret digital outcomes.

Every industry is looking to facilitate consumer self-service and minimize manual interventions by simplifying, automating and making end-to-end processes more intelligent.

For this reason, Gartner expects that by next year, more than 40 vendors to be offering managed services products leveraging smart machines and industrialized services.

Widespread Adoption Of Wireless Health Monitoring Technology

Today, a simple wristband can collect heartbeat, temperature and environmental data, with technological advancements in smart devices such as heart monitoring patches and smart shirts providing more accuracy, choice and comfort to wearers.

Gartner said straightforward wireless transmission allows data to be correlated against large cloud-based information repositories and through social media for anecdotal information.

Data from remote monitoring devices should boost access to medical practitioners, Gartner said, with smartphones expected by 2017 to lower the cost for diabetic care by 10 percent.

Mobile Digital Assistants Will Perform More Than $2 Billion of Online Shopping By 2016

Mobile digital assistants will build trust with the American public over the next 12 months by completing mundane tasks such as filling out names, addresses and credit card information or replenishing groceries.

But by 2016, Gartner said these assistants should be able to handle more complex purchasing decisions such as back-to-school backpacks or scheduling a car pickup, dinner and a movie.

Gartner expects some 2.5 percent of mobile users to trust these assistants with an average of $50 per year. Though digital assistants will be available on other platforms, Gartner expects mobile to be the most accessible, adopted platform for this purpose.

Mobile Commerce Revenue Will Make Up Half of America's Digital Commerce Revenue By 2017

Mobile payment technology is on the rise, Gartner said, along with a significant increase in mobile commerce due to the introduction of Apply Pay and Google's efforts to promote Google Wallet.

Increasingly powerful applications, smartphones and tablets allow consumers to seamlessly interact with companies, content and commerce at every stage of the purchase process, according to Gartner.

And as security, usability and functionality improve, devices will become even more embraced by young customers. Gartner said millennials who grew up on the Internet will demand that service providers and retailers deliver a connected, channel-agnostic commerce experience.

Some 70 Percent of Businesses Will Rely On Deliberately Unstable Business Processes By 2017

Rapid innovation is forcing companies to create processes that are deliberately unstable, meaning that they are agile, adaptable and designed to change according to customer needs.

These "supermaneuverable" processes -- which Gartner expects to see in 5 percent of global organizations by the end of next year -- exist within the context of larger, more stable processes.

Deliberately unstable processes leverage the concepts of organizational liquidity to bolster the ability of people and organizations to change in a more fluid manner.

Gartner said deliberately unstable processes are impossible for competitors to duplicate and allow larger, more stable processes to continue even in the context of unpredictable customer decisions.

Consumer Product Investments Will Be Redirected To Consumer Experience Innovations

Hyper-competition has eroded traditional product and service advantages, particularly in consumer markets, making customer experience the new competitive battlefield.

Gartner said consumer markets face disproportionate commodity pressure as consumer access to pricing and product information via social media has undermined brand loyalty.

Therefore, innovation focused on new products or new business models is subject to shrinking periods of competitive advantage, Gartner said.

Businesses would be better served by attempting to create brand loyalty by innovating on the customer experience. For this reason, Gartner expects more than half of traditional consumer products to have native digital extensions by next year.

Durable Goods E-Tailers And 3-D Printing

Startups have lowered their infrastructure costs by switching from traditional manufacturing processes to 3-D printing.

Gartner said e-tailers have looked to move from configurable to personalized products enabled by 3-D printing as consumers have indicated a desire to control more product features.

Therefore, Gartner expects manufacturers to develop capabilities to bring the consumer closer to the design experience, with a surge in 3-D-enabled personalization for almost every good.

Successful companies will have a corporate culture that's supportive of nonconformance products and agility that goes beyond rigid automation. Gartner expects 90 percent of durable good e-tailers to by next year seek external partnerships to support new personalized products.

Retail Businesses Use Targeted Messages And Internal Positioning Systems

The growth of consumer mobile devices offers mobile advertising and advanced analytics opportunities to digital marketers, Gartner said.

Context will one day enable targeted ads based on recent purchases, buying habits, city of residence and interests, Gartner said.

Although mapping is today being used in relatively simple ways, Gartner said indoor positioning systems -- which use Bluetooth beacons and Wi-Fi access points to pinpoint a mobile device's location inside a building -- have become increasingly viable.

Newer mobile devices will be enabled to receive targeted messages based on location, with real-time mapping leading customers not only to store locations, but also to specific products.