New research from Bain & Company and Red
Hat indicates that many traditional companies are at an early stage
in their digital journey; leaders stand out based on their use of
advanced technologies, such as cloud computing, advanced analytics
and modern app development
Bain & Company and Red Hat (NYSE: RHT), the world's leading
provider of open source solutions, today released the results of
joint research aimed at determining how deeply enterprises are
committed to digital transformation and the benefits these
enterprises are seeing. The research report, For Traditional
Enterprises, the Path to Digital and the Role of Containers,
surveyed nearly 450 U.S. executives, IT leaders and IT personnel
across industries and found that businesses that recognize the
potential for digital disruption are looking to new digital
technologies - such as cloud computing and modern app development -
to increase agility and deliver new services to customers while
reducing costs. Yet, strategies and investments in digital
transformation are still in their earliest stages.
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For those survey respondents that have invested in digital, the
technology and business results are compelling. Bain and Red Hat’s
research demonstrates that those using new technologies to
digitally transform their business experienced:
- Increased market share. These
enterprises are eight times more likely to have grown their market
share, compared to those in the earliest stages of digital
transformation.
- Delivery of better products in a
more timely fashion through increased adoption of emerging
technologies - as much as three times faster than those in the
earlier stages of digital transformation.
- More streamlined development
processes, more flexible infrastructure, faster time to market and
reduced costs by using containers for application
development.
Despite the hype, however, even the most advanced traditional
enterprises surveyed still score well below start-ups and emerging
enterprises that have embraced new technologies from inception
(digital natives). According to the survey results, nearly
80 percent of traditional enterprises score below 65 on a 100-point
scale that assesses how these organizations believe they are
aligning digital technologies to achieve business outcomes.
Ultimately, the report reveals that the degree of progress among
respondents moving towards digital transformation varies widely,
driven in part by business contexts, actual IT needs and overall
attitudes towards technology. It also uncovers some common themes
in the research.
For example, Bain and Red Hat found that while 63 percent of
enterprises surveyed have built processes to respond to digital
trends, only 19 percent see rapid innovation as a priority.
Additionally, for approximately 65 percent of survey respondents,
the primary motivation driving their digital efforts is moves made
by their competition, highlighting a highly reactive approach to
digital transformation.
“We see many traditional enterprise companies still trailing on
measures of digital maturity, even among the most advanced firms,”
said Jeff Taylor, a partner in Bain’s Technology Practice and
co-author of the report. “As we took a deeper look at these
companies surveyed, we saw that those advancing further and faster
on the adoption curve treat digital as more than just a singular
function or activity. They view it as a comprehensive,
cross-functional transformation, implementing changes across their
leadership, organization, product development approach and
processes, IT strategy and investments, data governance and tools,
etc. Building sufficient digital capabilities that will generate
the desired results is not a straightforward journey. Success
requires a sustained multi-year focus.”
As companies progress on their digital adoption journey, they
typically invest in increasingly more sophisticated capabilities in
support of their technology and business goals. The use of modern
application and deployment platforms represents the next wave of
digital maturity and is proving to be key in helping companies
address their legacy applications and infrastructure.
Containers are one of the most high-profile of these development
platforms and a technology that is helping to drive digital
transformation within the enterprise. Containers are self-contained
environments that allow users to package and isolate applications
with their entire runtime dependencies - all of the files necessary
to run on clustered, scale-out infrastructure. These capabilities
make containers portable across many different environments,
including public and private clouds.
In the course of their research, Bain and Red Hat found that
enterprises using containers are beginning to realize material
architectural benefits. Based on the analysis of survey
respondents, initial container adopters could realize a 15 to 30
percent reduction in development times, and additional
infrastructure flexibility gains driven by the portability benefits
of containers. The results of the survey also found cost savings of
five to 15 percent from hardware productivity are possible.
“Containers are on track to play an important role in not only
application development for highly automated, scale-out platforms,
but also in helping to drive the modern enterprise forward on their
journey towards digital transformation. While most survey
respondents - about 80 percent - are currently using containers
primarily for web apps, we expect to see this start to shift to
include more mission-critical workloads,” said Tim Yeaton, senior
vice president, Infrastructure Business Group, Red Hat. “In that
time, we anticipate a growing set of more ‘traditional’ workloads
will be prioritized for containerization, including custom
applications, databases and business intelligence.”
The proportion of respondents selectively or broadly adopting
container technology tied to benefits and complementary trends is
expected to grow across all application lifecycle phases - from
about 20 percent currently to upwards of 40 percent over the next
three years.
While the opportunities created by these emerging technologies
are compelling, the speed and path of adoption for containers is
somewhat less apparent, according to the Bain and Red Hat report.
The biggest hurdles standing in the way of widespread container use
according to respondents are common among early stage technologies
- lack of familiarity, talent gaps, hesitation to move from
existing technology and immature ecosystems - and can often be
overcome in time. Vendors are making progress to address more
container-specific challenges, such as management tools,
applicability across workloads, security and persistent storage,
indicating decreasing barriers to adoption.
For more details, read the full report: For Traditional
Enterprises, the Path to Digital and the Role of Containers.
Methodology
Bain and Red Hat conducted a survey of 449 respondents, broken
out across senior executives, senior IT decision-makers and IT
development/operations personnel, with the latter primarily
addressing specific questions related to containers. The survey
focused on traditional enterprise in the US, and captured a
representative distribution of industries and company sizes.
About Bain & Company
Bain & Company is the management consulting firm that the
world's business leaders come to when they want results. Bain
advises clients on strategy, operations, technology, organization,
private equity and mergers and acquisition, developing practical
insights that clients act on and transferring skills that make
change stick. The firm aligns its incentives with clients by
linking its fees to their results. Bain clients have outperformed
the stock market 4 to 1. Founded in 1973, Bain has 53 offices in 34
countries, and its deep expertise and client roster cross every
industry and economic sector. For more information visit:
www.bain.com. Follow us on Twitter @BainAlerts.
About Red Hat, Inc.
Red Hat is the world's leading provider of open source software
solutions, using a community-powered approach to provide reliable
and high-performing cloud, Linux, middleware, storage and
virtualization technologies. Red Hat also offers award-winning
support, training, and consulting services. As a connective hub in
a global network of enterprises, partners, and open source
communities, Red Hat helps create relevant, innovative technologies
that liberate resources for growth and prepare customers for the
future of IT. Learn more at http://www.redhat.com.
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version on businesswire.com: http://www.businesswire.com/news/home/20161201005729/en/
Bain & CompanyDan Pinkney, +1
646-562-8102dan.pinkney@bain.comorRed Hat, Inc.John Terrill, +1
571-421-8132jterrill@redhat.com
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