Future of Work spending to hit $17.4% growth in 2021

Before the end of 2021, organisations would have spent nearly $656 billion on Future of Work (FoW) tech innovations, according to an estimate by the International Data Corporation (IDC).

It represents an increase of 17.4 percent from the previous year and a clear indication that most of the business world is not ready to go back to traditional work models.

Holly Muscolino, research vice president, Content Strategies and the Future of Work, at IDC, explains that traditional work models do not provide the agility, scalability, and resilience required by the future enterprise.

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“This was, of course, highlighted by the ongoing health crisis. To drive growth and competitive differentiation, organisations will invest in technologies and services that power automation, human-machine collaboration, new organisational structures, and leadership styles, dynamic learning opportunities, a reimagined workplace, and a digital work environment that is not bounded by time or physical place,” Muscolino said.

In Nigeria, companies are also beginning to realise this thanks to the COVID-19 pandemic. Employees can work remotely for some days but may be required to work on-site two or three times a week. This is the approach Kobo360 and Daystar Power are using. Daystar Power adopted the hybrid model for most employees while requiring network system operators, technicians, and warehouse workers to work on-site. Others like Andela are permanently on remote mode.

The IDC report noted that organisations are investing in a wide range of technologies and services to facilitate the transition to the new workplace and an evolving workforce.

Investment in hardware is expected to take the most share as orgnisations are expected to splash $228 billion in endpoint devices, enterprise hardware, infrastructure as a service (IaaS), and robotics and drones. The second-largest investment would go to services, including business, IT, and connectivity services. Organisations would deploy over $123 billion. The fastest spending growth with a compound annual growth rate (CAGR) of 21.3 percent over the 2020-2024 forecast period would go-to software. This would include investments in enterprise applications, content and collaboration, analytics and artificial intelligence, human resources applications, security, and software development and deployment.

“Emerging technologies like artificial intelligence, the Internet of Things, and augmented/virtual reality are changing how work is getting done across all industries and across the world. Seeking automated decision support and virtual collaborative approaches, discrete and process manufacturing, the two largest spenders on Future of Work technology over the forecast period, are investing in key use cases like collaborative robotics, operational performance management, and 3D and digital product design and review for improved cost control and higher process efficiency,” said Eileen Smith, program vice president, Customer Insights and Analysis.

Together, discrete and process manufacturing will account for just over one-third of all Future of Work spending this year. Professional services, retail, and banking will be the next three industries in terms of FoW spend in 2021. The construction industry will see the fastest growth in FoW spending over the forecast period with a five-year CAGR of 23.7 percent. Media and retail will follow closely with CAGRs of 19.5 percent and 19.3 percent respectively.

The FoW use cases that will benefit from the most spending in 2021 include collaborative robotics, operational performance management, and automated customer management. The use cases that are expected to see the fastest spending growth over the 2020-2024 forecast period are adaptive skill development, interconnected collaborative workspaces, and advanced project management.

“IDC forecasts investment in technologies supporting Future of Work initiatives to exceed $1 trillion worldwide by 2024 with a robust 17 percent CAGR over the five-year forecast period. All aspects of how people and organizations work are evolving, enabled by 3rd Platform technologies, and accelerated by the pandemic. Indeed 3rd Platform hardware, such as IoT devices, robots and drones, and IaaS, are more than one-third of the total spend, demonstrating the growing importance of the technologies enabling the reimagined workplace,” said Karen Massey, research manager, Customer Insights & Analysis.