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How enterprises create new business value through digitalization

A future of enterprise study, Issue #4.1

An introduction to the evolution of enterprise digitalization

This report explores what business values enterprise decision makers and employees attach to digitalization in general, the role of 5G, cloud, AI, digital twins and immersive technologies in the evolution of use cases such as asset monitoring, remote control and connected offerings.

The strive towards increased business value creation is nothing new, however the ways to achieve it is continuously evolving!

Today, digitalization is revolutionizing the business value creation process. It has become a quintessential driving force for organizational relevance. Integrated across operations, it creates agility, advances operations and boosts resilience. 

In this, the fourth edition in the Ericsson IndustryLab report series – Future of Enterprises, the focus is to cover the present, near-future, and more long-term evolution of enterprise digitalization.

This research aims to support enterprise decision-makers and communication service providers by outlining the opportunities, challenges involved, and the role of enabling technologies on the road to enhanced business value creation today as well as in the future.

To achieve this, the research investigates current enterprise digitalization, both generally and more specifically in the form of use cases that are relevant across a wide range of industry segments, by surveying 9000 decision-makers and employees across 15 markets around the world to answer questions such as:

  • What business values do the enterprise decision makers and employees attach to digitalization in general, as well as to each of the use cases?
  • What is the current and projected levels of use case utilizations, and how do these differ across various industry segments?
  • What role do cellular (5G and beyond), cloud, AI, digital twins, and immersive technologies play as enterprises continue their digitalization journey, and how is this expected to evolve going forward?
  • Which are the key challenges hindering enterprise digitalization initiatives that need to be addressed?
  • What sustainability implications from a triple bottom line (i.e., environmental, social & economical) are associated with the use cases?

To truly cover this rather extensive research topic, this research has been divided into three different deliverables.

This is the first deliverable, which contains a global, cross-industry analysis of the business value creation opportunities, currently as well as in the future, particularly those linked to cellular and cloud enabled use cases such as Remote control, Asset monitoring, and Connected offerings. The study’s global, quantitative insights are enriched through qualitative interviews with industry and academic experts, as well as through an industry case study featuring Motor City Wash Works, a customer of Cradlepoint, part of Ericsson, utilizing cellular and cloud technology to drive value creation, particularly agility and resilience, in their customer offering!

In the second deliverable, the business value creation opportunities linked to human-centric use cases will be studied in a similar fashion.

The third and final deliverable will, in part, serve as a summary, drawing on reflections from deliverables 1 and 2. It will also provide a longer-term foresight, by outlining the future vision of enterprise digitalization and business value creation.

Introduction

Today, digitalization is revolutionizing they way enterprises create business value. Integrated across organizations operations, digitalization improves agility, advances operations and boosts resilience.

Enterprises are faced with some daunting challenges in keeping pace with the changing needs of their customers in a rapidly evolving digital and business landscape, such as the ability to quickly adapt to rapidly changing conditions, increasing demands for efficiency and just generally becoming better at working securely in an environment that they can not fully control.

To truly cover this rather extensive topic, this research has been divided into three different deliverables:

This first deliverable contains a global, cross-industry analysis of current as well as future value creation opportunities, particularly those linked to cellular and cloud enabled use cases such as remote control , asset monitoring and connected offerings . These quantitative and qualitative research insights are complemented by insights from an industry case study where Motor City Wash Works, a customer of Cradlepoint, which is part of Ericsson, is using cellular and cloud technology to drive value creation, to drive agility and resilience, in their customer offering.

In the second deliverable, the value creation opportunities are linked to more human-centric communication solutions use cases. Also in this deliverable, the research insights will be complemented by an industry case study to understand the business values derived.

The third and final deliverable will summarize the reflections from the first two deliverables, and also provide a longer term foresight, by outlining the future vision of enterprise digitalization and business value creation.

Massive value and major investments are already here

Here and now

This chapter takes a closer to at the current enterprise digitalization situation, and what business values are being derived across a wide range of industry segments already today.

Read the chapter

Key findings

Significant untapped digitalization potential

There is significant untapped digitalization potential in asset monitoring, remote control and connected offerings, with 8 in 10 decision-makers stating that the main value drivers are boosting agility and resilience.

  • Around half of the decision-makers1 say they currently only have a limited-to-moderate utilization level of asset monitoring and remote control.

IoT growth enablers

Cellular technology is considered to be a key enabler for growth of IoT use cases by 7 in 10 decision-makers.

  • However, cellular connectivity’s ability to drive fast scaling is underestimated or not fully understood.

1. Questions related to specific use cases have only been answered by decision-makers who classified the respective use cases as a top-two priority for their companies

Applying a micro-factory automation approach – Insights from an industry case study

Industry Case study

This chapter takes a closer look at an industry case study featuring Motor City Wash Works, a customer of Cradlepoint, part of Ericsson, and how they are utilizing cellular and cloud technology to drive value creation in the form of agility and resilience, in their customer offering.

Read the chapter

Case study insights

Embedding cellular connectivity into Motor City Wash Works’ automatic car wash tunnel systems significantly reduces time-to-market (TTM) and facilitates customer agility with “plug-and-play” solutions. Enterprise routers with embedded SIM cards and cellular subscriptions allow a plug-and-play setup of Wireless WAN connectivity. This can reduce the setup time of a new car wash tunnel by several weeks.

Unlocking full digitalization potential with the evolution of IoT use cases

Future outlook

This chapter expands on the future opportunities of enterprise digitalization, by studying how core enablers such as 5G and cloud solutions, and key technologies such as AI, XR, digital twins and low-powered sensors are expected to enhance the studied use cases, and drive their growth trajectories.

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Key findings

Infrastructure is leading the way

The infrastructure segment is leading asset monitoring with the deployment of Extended Reality (XR), low-power sensors, AI and digital twins, averaging a 28 percent higher expected mid-term utilization than the laggard segments.

  • The segment is also expected to keep its leading position in the long term.

Challenges to growth

Challenges including regulation, solution capabilities and cellular coverage are putting market growth at risk, according to more than 6 in 10 decision-makers.

  • Additionally, scalers seem to underestimate this challenge.

Increased importance of social sustainability in business

Sustainability

Importance of sustainable digitalization: This chapter aims to give an overview of how decision makers and employees relate to the ever-increasing climate and socio-economic challenges, and how they understand digitalization from a “triple bottom line” sustainability perspective.

Read the chapter

Key findings

Augmenting human capabilities

The importance of social sustainability is ever increasing.

  • In the automation era, AI, XR and haptic devices are set to augment humans, with roughly 7 in 10 decision-makers expect their companies to enhance their IoT use cases with human-focused tools such as XR, haptic devices and AI-enhanced functions in the next 3-5 years.

How enterprises create new business value through digitalization

Enterprises are faced with some daunting challenges in keeping pace with the changing needs of their customers in a rapidly evolving digital and business landscape. Read more about how cellular connectivity, cloud, AI, digital twins and immersive technology is expected to evolve use cases such as asset monitoring, remote control and connected offerings and thus pave the way for enterprise agility and reslilience in the report.

Download the report

This report has shed light on digitalization opportunities for enterprises striving to enhance their capacity to generate value, whether to create agility, advance operations, or boost resilience.

The focus has been to cover the present, near-future and more long-term evolution of enterprise digitalization, with the purpose to support enterprise decision-makers and communication service providers by outlining the opportunities, challenges, and the role of enabling technologies involved on the road to the future.

This was facilitated through a global quantitative and qualitative study covering three IoT use cases -asset monitoring , remote control , and connected offerings - along with an industry case study demonstrating their value for enterprises.

The key findings in this report were:


Untapped digitalization potential

There is significant untapped digitalization potential in asset monitoring, remote control and connected offerings, with 8 in 10 decision-makers stating that the main value drivers are boosting agility and resilience.

  • Around half of the decision-makers¹ say they currently only have a limited-to-moderate utilization level of asset monitoring and remote control.

IoT growth enablers

Cellular technology is considered to be a key enabler for growth of IoT use cases by 7 in 10 decision-makers.

  • However, cellular connectivity’s ability to drive fast scaling is underestimated or not fully understood.

Infrastructure is leading the way

The infrastructure segment is leading asset monitoring with the deployment of Extended Reality (XR), low-power sensors, AI and digital twins, averaging a 28 percent higher expected mid-term utilization than the laggard segments.

  • The segment is also expected to keep its leading position in the long term.

Challenges to growth

Challenges including regulation, solution capabilities and cellular coverage are putting market growth at risk, according to more than 6 in 10 decision-makers.

  • Additionally, scalers seem to underestimate this challenge.

Augmenting human capabilities

The importance of social sustainability is ever increasing.

  • In the automation era, AI, XR and haptic devices are set to augment human, with roughly 7 in 10 decision-makers expecting their companies to enhance their IoT use cases with human-focused tools such as XR, haptic devices and AI-enhanced functions in the next 3–5 years.

This study clearly shows that decision makers and employees place significant value on all three studied IoT use cases, both in the present, and in the mid- (3-5 year) and long-term (7-10 years) perspectives.

This presents significant opportunities for CSPs and enterprises across all industry segments, provided that the identified challenges are not underestimated by enterprises currently scaling up their digitalization efforts and are treated and handled with due respect. Cellular connectivity, be it 5G or beyond, along with cloud solutions, are key enablers for the evolution and utilization of these use cases to progress as expected.

Ericsson Consumer & IndustryLab explores the future of technology for consumers, enterprises and a sustainable society. We deliver world-class market research, actionable insights and design concepts to drive innovation and sustainable business development. We provide a scientific fact-based analysis regarding environmental, social and economic impacts and the opportunities of ICT.

Our knowledge is gained from global consumer, enterprise and sustainability research programs, including collaborations with leading customers, industry partners, universities and research institutions. Our research programs cover in-depth studies and over 100,000 interviews with consumers, working people and decision-makers each year, in 30 countries – statistically representing the views of 1.1 billion people.

Our reports can be found at IndustryLab

Quantitative data was collected through an online survey with 9,000 respondents aged 18 and older in Australia, Brazil, China, Germany, India, Indonesia, Japan, Malaysia, Singapore, South Africa, South Korea, Sweden, Thailand, the UK and the US. The seven industry segments covered in this study comprise asset-, site-, infrastructure-, finance-, consumer-, society- and service-centric companies. These segments may be referred to throughout the report as, for example, “finance companies”. Of the respondents, 4,500 were decision-makers in companies with 50 or more employees. The remaining 4,500 respondents were employees. The early-adopter profile of many of these respondents makes them important when it comes to exploring the future evolution of enterprises. The online survey was conducted between July 27 and September 8, 2023.

Qualitative insights were gathered through 32 telepresence interviews with decision-makers, subject matter experts and academic researchers in the US and Europe. These interviews were conducted between January 12 and December 6, 2023.

In this study, a decision-maker is a person with the final say-so or significant influence on strategic ICT and/or business development decisions and are considered to represent the company they work for. Questions related to specific use cases have been answered by a random selection of decision-makers and employees, that have classified that particular use case as a top-two priority for their companies (decision-makers) or for their own work roles (employees).

Markets included in the study

Markets included in the study
  • Case study - A description of a real-life company having implemented one or several use cases, often outlining both what they wanted to solve, and what the outcome of the implementation was.
  • Digital tools and components - Applications, features or capabilities used to enhance a use case beyond its most basic functionality.
  • Digital twin - Real-time digital replicas of physical objects or processes, often used for simulations.
  • Low utilizers - A company on a comparably low current level of utilizing the studied use case across its operation, and with no expectation to change significantly in the future.
  • High utilizers - A company on a comparably high current level of utilizing the studied use case across its operation, and with no expectation to change significantly in the future.
  • Scalers - A company currently on a comparably low level of utilizing the studied use case across its operation, but with an expectation to significantly increase its utilization in the future.
  • Technology enabler - A high-level set of technologies that act as the prerequisite, foundation or facilitator of digital use cases. For example, cloud computing or cellular technology.
  • Use case - A set of actions performed by an actor (user or machine) when interacting with a product or system to achieve a specific task. A use case can be expanded by adding different digital tools and components. This report focuses on three use cases: asset monitoring, remote control and connected offerings.

About the authors

Sepideh Matinfar

Sepideh Matinfar

Sepideh Matinfar is a senior researcher at Ericsson IndustryLab. She has been working with different sustainability questions, performing Life Cycle Assessment of ICT products and services. Today her research also covers enterprise market research. Sepideh holds an MSc in Environmental Science from Stockholm University.

Jana Uthayakumar

Jana Uthayakumar

Jana Uthayakumar is a master data & analytics researcher at Ericsson Consumer & IndustryLab. He has over 8 years of experience working in market research, specializing in marketing and data science. Jana leads the analytical framework in projects by translating business questions into data-driven solutions as well as identifying innovative methodologies.

Jens Erler

Jens Erler

Jens Erler is an IoT Client Principal at Ericsson. He is an expert in digital industry transformation, business models and ecosystems and has 25 years of experience working with different industries. Jens is passionate about sustainability and innovation and holds a MSc in Telecom Engineering from the University of Darmstadt.

Anders Erlandsson

Anders Erlandsson

Anders Erlandsson is heading up Ericsson IndustryLab. He has worked extensively with consumer and industry market research since 2005. He is based in Stockholm, Sweden and has previously held various positions in Sweden and in the UK. Anders holds an MSc in Industrial Engineering and Management from the Linköping Institute of Technology.

Sarah Kenlind

Sarah Kenlind

Sarah Kenlind is a senior researcher at Ericsson IndustryLab. She is an academic professional with 8 years of research experience in business model innovations in manufacturing industries; and 4 years of marketing analytics experience within retail and FMCG sectors. Sarah holds a PhD in Industrial Management from Linköping University.

Patrik Hedlund

Patrik Hedlund

Patrik Hedlund is a master researcher at Ericsson IndustryLab. His research is focused on the role of new technology for industries and society. He has extensive experience within the telecom sector, with previous positions in business development, product management and marketing. Patrik holds a MSc in electronic engineering from the University of Uppsala.

How enterprises create new business value through digitalization

Enterprises are faced with some daunting challenges in keeping pace with the changing needs of their customers in a rapidly evolving digital and business landscape. Read more about how cellular connectivity, cloud, AI, digital twins and immersive technology is expected to evolve use cases such as asset monitoring, remote control and connected offerings and thus pave the way for enterprise agility and reslilience in the report.

Download the report

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