Companies will spend $118 trillion (€105 trillion) on digital transformation this year, according to a new forecast from research company IDC. This marks a 17.9 per cent increase compared to 2018, it said.
It forecasts that worldwide spend on digital transformation is set to total more than $6 trillion over the next four years as enterprises step up their investment in new technologies and services.
IDC predicted that spending will jump to between 14 per cent and 20 per cent across all industries. However, it predicts that the financial sector will record the biggest increases, with a compound annual growth rate (CAGR) in spending of 20.4 per cent between 2017 and 2022.
"Digital transformation is quickly becoming the largest driver of new technology investments and projects among businesses," said Craig Simpson, research manager with IDC's Customer Insights & Analysis group.
“It is already clear from our research that the businesses which have invested heavily in digital transformation over the last two to three years are already reaping the rewards in terms of faster revenue growth and stronger net profits compared to businesses lagging in initiatives and investments.”
Digital transformation
Discrete manufacturing and process manufacturing are the sectors expected to record the biggest growth in digital transformation spending this year at $221.6 billion and $124.5 billion respectively.
Retail will be the next largest industry in 2019, followed closely by transportation and professional services.
Hardware and services investments will account for more than 75 per cent of all spending this year, according to IDC.
The US and China will be the two largest geographic markets for digital transformation spending, delivering more than half the worldwide total in 2019.
