Enterprise-reboot

Enterprise
reboot
Scale digital technologies to grow
and thrive in the new reality
2020 Global Emerging Technology Survey Report
A collaboration between KPMG International

and HFS Research
read.kpmg.us/enterprisereboot
Are you Cloud. Automation. Analytics. Artificial intelligence.
Blockchain. 5G. Low-code software. The potential
ready? impact of each of these emerging technologies

is unquestionable. And when they converge,
their impact on organizational growth is almost
inconceivable.
New technologies are no longer just about doing things better, faster, and
cheaper. They now have implications for survival and growth in a new business
reality. Emerging technologies are transforming every industry, requiring legacy
businesses to radically reinvent themselves—faster than they ever imagined.
The COVID-19 pandemic has further reinforced the importance of driving enterprise
transformation using technology as an enabler. Technology underpins nearly every
change triggered or accelerated by the crisis. Emerging technologies that enable
automation, artificial intelligence, powerful computing, connected devices and
equipment, massive data transfer, collaboration, and business resilience are heroes
in these turbulent times, helping enterprises recover from the initial impacts of
COVID-19 and set a strong foundation for the future.
For example, many industries are fast-tracking the use of automation and robotics
to supplement human labor. The need to ramp up digital commerce offerings
has spurred wider adoption of cloud-enabled digital, analytics and machine
learning technologies. Companies are investing in myriad technologies, such as
IoT, blockchain, AI, predictive analytics, drones and extended reality, to make
supply chains more resilient and transparent. From work-at-home models to more
effective supply chains, technology is emerging as a core component of how every
company operates.
The impact of the pandemic is affecting every industry, but in very different ways.
Through this unprecedented change in the way we engage, some industries are
surging and experiencing strong growth, while others are on the verge of collapse
absent significant intervention. Following the shutdown, when human contact was
not possible, companies that were able to remotely connect with employees and
customers and manage current operations demonstrated a level of resilience that
increased trust in the business. Markets gained confidence that these businesses
would not only survive, but perhaps even thrive.
The collaborative study between KPMG International and HFS Research

underpinning this paper helped to prove that, no matter the industry or
the path to recovery, the financial and social impacts of the pandemic are
driving a massive shift in business priorities and objectives. The path forward
requires an accelerated digital transformation of organizations’ business
and operating models in order to ensure long-term growth and margin
improvement. Hesitant organizations are likely to be flattened by savvier
competitors that push the edges of innovation.
© 2020 KPMG International Cooperative (“KPMG International”). KPMG International provides no client services and is a Swiss
entity with which the independent member firms of the KPMG network are affiliated.
Burning
platform
for digital
transformation
At the same time, however, enterprises are challenged to keep pace with the Big questions existed before the
exponential rate of technology innovation and the need to quantify the return COVID-19 crisis. Now they have
on their investments. While COVID-19 has created a burning platform for digital more urgency than ever.
transformation, companies’ knee-jerk reaction after the pandemic shock has been
to reduce technology investments and question technology’s ability to drive value • How can we take full advantage
across the enterprise. of emerging technologies to
drive competitive advantage?
Despite the challenges of emerging technology adoption and deployment,
there is no turning back. Navigating through today’s challenges, and seizing • What should our emerging
tomorrow’s opportunities, requires enterprises to reboot their vision, technology roadmap look like?
strategy, and operating models to capitalize on the evolving technology
landscape. • How will we capture and
measure the true value of
To help guide the way, KPMG and HFS Research are pleased to share Enterprise
our emerging technology
reboot, a research report focused on driving tangible value from emerging
investments?
technologies in the new reality. Drawing insights from global survey data and
first-person interviews, the report seeks to assess the current and future state • What is the best approach to
of emerging technology adoption, explore the challenges of value realization, and managing emerging technology
reveal how organizations can fully capitalize on technology’s promise. Our research risks?
reflects the perspectives of hundreds of enterprise technology leaders around the
world, as well as KPMG and HFS Research thought leaders, and global luminaries.
• To what extent can we
accelerate digital transformation
These are challenging times, with technology advancement creating both immense across the enterprise?
disruption and opportunity, as well as lingering uncertainty about where to focus
resources. We hope this report delivers greater clarity about the future and a • Where do we start?
practical roadmap for arriving there stronger than ever.
Cliff Justice Phil Fersht

Global lead for Intelligent CEO and Chief Analyst,
Automation and U.S. lead HFS Research
for Digital Capabilities,
KPMG International
Enterprise reboot 1
Research methodology Contents
In March-June 2020, KPMG International and HFS Research Key findings. . . . . . . . . . . . . . 3
conducted two global, cross-industry quantitative surveys. Nine
hundred business and technology executives were surveyed New technology
about the enterprise’s investment and adoption of emerging essential
technology. All respondents held executive-level positions at
for survival. . . . . . . . . . . . . . . 4
Global 2000 enterprises with US$1B+ annual revenue, operating
across nine business sectors and nine countries (Australia,
Canada, France, Germany, India, Japan, the Netherlands,
Variations on the
the U.K, and the U.S.). Survey data was supplemented by road to recovery. . . . . . . . . . 9
qualitative, in-depth interviews with enterprise leaders who
oversee the investment and adoption of these emerging Uncertainty threatens
technologies in their organizations. The margin of error for this current investments . . . . . 10
research is +/- 4.6 percentage points (4% on Survey I and 6% on
Survey II) at the 95 percent confidence level. Investment clarity
found . . . . . . . . . . . . . . . . . . 14
Research was conducted in two phases: a March-April 2020
survey conducted when many countries were starting to see
New opportunities for
the impact of the COVID-19 pandemic (Phase I) and a May-June
promising technologies. . . 20
2020 survey conducted when many economies and societies
were shut down due to the virus (Phase II). The sample between
the two survey phases was primarily balanced by industry and The case for higher
revenue. By conducting two phases of research, we sought investment. . . . . . . . . . . . . . 25
to achieve a fuller picture of the impact of the pandemic on
enterprise approaches to emerging technology adoption The power of “and”. . . . . . 27
and the sentiment toward the evolving emerging technology
landscape. To ensure consistent interpretations throughout the Superheroes and
survey and between the two phases of research, we presented Stragglers . . . . . . . . . . . . . . 29
respondents with definitions of each technology covered in the
survey, including process automation, artificial intelligence (AI), What’s next? . . . . . . . . . . . . 30
smart analytics, hybrid cloud, multi-cloud, blockchain, 5G, edge
computing, Internet of things (IoT), augmented/virtual reality About KPMG and
(AR/VR), cyber security, quantum computing, and trusted data HFS Research. . . . . . . . . . . . 32
backbone.
2 Enterprise reboot
Key findings
Business priorities have shifted overnight.
57%
of executives say COVID-19 has significantly changed their organization’s strategic
priorities for emerging technologies. The immediate focus is survival, which has become the #1
objective for most emerging technology investments. Meanwhile, making the business case has emerged
as the primary challenge to realizing value from emerging technologies.
Resiliency requires a completely new playbook.
59%
of executives say the pandemic has created an impetus to accelerate their digital
transformation initiatives, yet average investments in emerging technologies have been slashed.
COVID-19 creates a burning platform for organizational change, but with enterprises facing a cash crunch,
there are fewer funds available to invest in enabling technology. Only 13 percent expect to “significantly
increase” investments in emerging technologies as a direct result of COVID-19.
Spending cuts for enabling technologies are likely short term.

OVER
12
months, executives expect to increase spending across nearly all technology areas as
THE they seek out ways to reboot the enterprise and get fit for the new reality. So, while edge computing,
blockchain, AI and 5G are seeing deeper investment reductions during the pandemic, these spending
NEXT cuts aren’t permanent.
The crisis is driving clarity in technology investments.
56%
of executives agree that cloud migration has become an absolute necessity. As
they plot a path toward recovery, many enterprises are zeroing in on mature technologies such as
cloud, automation, and analytics that will drive quick ROI. These three technology areas are gaining
additional focus.
The power of AND is greater than the power of OR.
64%
of executives believe that the combined use of emerging technologies is much more
beneficial than using any of the technologies in isolation. “AI-powered” and “cloud-enabled” are
emerging as the foundation. They are featured in more than 1/3 of all technology solutions.
With higher investments comes more realized value.

MORE THAN of companies are investing or planning to invest in emerging technologies.
80%
Organizations in the highest investment quartile are seeing substantially greater returns than
organizations in the lowest investment quartile, in some cases achieving more than 20 percent greater
value from their emerging technology investments.
© 2020
2018 KPMG
KPMG LLPInternational
, a Delaware
Cooperative
limited liability
(“KPMG partnership
International”).
and the KPMG
U.S. member
International
firm ofprovides
the KPMGno network
client services
of independent
and is a Swiss
member
entity with
firms
which
affiliated
the independent
with KPMGmember
International
firmsCooperative
of the KPMG(“KPMG
networkInternational”),
are affiliated. a Swiss entity. All rights reserved.
Enterprise reboot 3
New From the earliest stages of the crisis, COVID-19 illuminated a
clear link between digital preparedness and business resilience.
Our survey found that enterprises with the right digital-centric
technology mindset prior to COVID-19 have been much more successful at

weathering the storm, recovering quickly at scale, and building a
essential strong foundation for the future business environment.
for survival Now, as enterprises deal with the

prolonged fallout from the crisis, there is
growing recognition of the importance
of emerging technology to the future
The pandemic is also proving that
emerging technology can deliver much
more than a slight competitive edge—it
often spells the difference between
business. According to our survey, success and failure.
nearly 60 percent of executives agree
Fifty-seven percent of executives say
that COVID-19 has created an impetus
COVID-19 has significantly changed
to accelerate digital transformation
their organization’s strategic priorities.
initiatives.
The objectives of emerging technology
Our observations with clients also investments are shifting in step. In the
support this finding. As we help Phase I survey, growth goals like cost
businesses respond to and recover reduction, improved brand value, and
from the impacts of COVID-19, it has clearer decisions were all at the top
become evident that an organization’s of the list. In Phase II—when many
ability to harness and leverage emerging economies and societies were shut
technologies in transformation efforts down due to the virus—objectives have
will determine their ability to thrive in become much clearer: The number
a changed business environment. We one aim of emerging technology
have seen that industries with strong investments for nearly all companies
digital transformation execution, such surveyed is future survival.
as online retail, telemedicine, food
57%
delivery, and streaming media, had
the opportunity to scale aggressively o
f executives
during the recovery, which should last surveyed said
going forward given changing consumer COVID-19
behavior during the pandemic. significantly impacted
their businesses’ strategic
priorities.
4 Enterprise reboot
INDUSTRY INSIGHT: PHILIPS
COVID-19 has accelerated new technology adoption
and prompted enterprises to use technologies that
were already available, however overlooked or
underutilized. Philips’ teleradiology solutions have
been on the market for more than a decade and
the technology is now being used at scale to help a
growing number of radiologists do remote readings
from the safety of their homes.
AI and predictive analytics promise to become key
tools in the fight against the COVID-19 virus itself.
Leveraging imaging and monitoring solutions, Philips
is working with clinical partners to create models
that anticipate patient needs for medical equipment
and ICU beds and plan accordingly. By gathering
signals from early stage diagnostics and other health
information, the technology could enable hospitals to
predict how many COVID-19 patients will need to be
admitted to an ICU or put on a ventilator.
Systems for teleradiology have

been available for years. But COVID-19
has dramatically expanded the
number of hospitals and medical
practices that leverage teleradiology
at scale, with radiologists working
from home or remotely. We now see
these technologies being used to help
overloaded radiologists on the front
lines of the COVID-19 crisis manage
suddenly heavier workloads safely
and efficiently.
– Hans-Aloys Wischmann,
Program Manager for Artificial Intelligence,
Precision Diagnosis, Philips
Enterprise reboot 5
Since the pandemic began, emerging Business case is far more critical as enterprises
technologies all along the spectrum
face cash crunch
have been embraced out of necessity.
As a result of COVID-19, more Top 10 challenges in realizing value Ranking in Ranking in
from emerging technologies Phase I Survey Phase II Survey
companies are leveraging technology
(Mar-Apr 2020) (May-June 2020)
to make immediate operational
changes (such as enabling remote
work, diversifying the portfolio,
Developing the business case 6 1
expanding delivery, and automating
processes) than to drive new growth
(such as pursuing acquisitions).
Commitment from C-suite/board 4 2
Meanwhile, as the pandemic has
progressed, making the business case Changing the organizational culture 1 3
has emerged as the primary challenge
to realizing value from emerging
Not sure which metric(s) to use to quantify
technologies. impact 8 4
Lack of talent 3 5
Developing the business
case and securing commitment
from the C-suite have emerged
as the top 2 challenges to
Lack of data quality and availability 5 6
realizing value from emerging
technologies.
Additionally, companies are no

Risk of failure is high 2 7
longer afraid of failure. Risk
of failure has moved from
the secondary challenge to
Lack of robust data management 7 8
number seven on the list of
challenges to realizing value from
emerging technologies. Cybersecurity and data privacy concerns 10 9
The technology is too new, waiting for it to
mature N/A 10
On-going governance 8 N/A
Lack of funds to invest 9 N/A

Sample: 300 executives (May-June 2020, Phase II sample) and 600 executives (March-April 2020, Phase I sample) across Global 2000
enterprises. Source: HFS Research in conjunction with KPMG International.
6 Enterprise reboot
Investment objectives narrowed during COVID-19:
The focus is now on future survival.
“Essential for survival” rose to the #1 ranking objective across a majority of technologies.
Top objectives for investments in Top objectives for investments in

Emerging Technology
Phase I (Mar-April 2020) Phase II (May-June 2020)
Cost reduction, improve brand value,
Process Automation Essential for future survival
top-line growth
Artificial Intelligence Cost reduction Essential for future survival
Smart Analytics Improve decision making Essential for future survival
Hybrid and/or Multi-cloud Cost reduction Essential for future survival

Foundation for infrastructure
Blockchain modernization, improve decision Improve competitive positioning
making, cost reduction
Edge computing Improve brand value Improve competitive positioning
Essential for future survival, improve
5G Essential for future survival
decision making
Sample: 300 executives (May-June 2020, Phase II sample) and 600 executives (March-April 2020, Phase I sample) across Global 2000 enterprises. Source: HFS Research in
conjunction with KPMG International.
Enterprise reboot 7
Technology
and trust:
two business success drivers
COVID-19 is driving massive market shifts around the

world, creating new ways of working, accelerating the surge
in digital commerce, and renewing focus on supply chain
localization. In working with clients and tracking marketplace
signals, KPMG professionals are seeing two business
success drivers that are being pushed to the forefront during
these unprecedented times: technology and trust.
The fact is that rapid development, adoption and integration

of technology does have the potential to increase risk across
the business. And we know that trust is essential for digital
transformation to go forward, but it was already eroding
prior to COVID-19. Now, the crisis has intensified prior trust
challenges and generated new ones. Visible trust gaps
for emerging technologies such as AI, blockchain and IoT
continue to remain significant barriers to adoption.
I believe that organizations will have to get trust right

for successful deployment of emerging technologies to
recover from the crisis. Even before COVID-19, clients who
had established sophisticated trust and risk management
infrastructures capable of responding dynamically were
the ones thriving. It is these organizations that are likely to
navigate through the recovery in better shape.
— Steve Hill,
Global Head of Innovation,
KPMG International
8 Enterprise reboot
Variations Many industries will be forever changed by the shift to digital
modes of operating that were established during COVID-19. KPMG’s
assessment of COVID-19 on global market signals reveals enduring
on the road impacts beyond the initial response on ways of working, digital
commerce, supply chain and manufacturing, labor force, and more.
to recovery As companies work to reestablish

resilience and adapt to life during
COVID-19, there is no one-size-fits-all
worried about survival. Preserving cash
and acquiring the capital they need to
transform are urgent priorities.
path forward. The depth and duration While the picture is far from certain,
of recession will vary by company and driving change through technology
sector. will be a critical factor in the ability of
Mature digital-first companies are thriving all companies to emerge from the
during COVID-19. Their businesses lockdown. Underlying this effort will
are accelerating and their immediate be strengthening of trust—trust that
focus is on scaling faster. Meanwhile, organizations are agile enough to execute
companies that have failed to execute the rapid transformation required to
digital transformation are on a downward ensure workforce safety and confront
spiral, losing customers, market share other COVID-19-related challenges.
and employees. These companies are
Varying degrees of risk exposure to COVID-19-driven shifts will result in a variety

Varying
of degrees
recovery of risk exposure
patterns whentoviewed
COVID-19atdriven shifts will result in an ‘alphabet soup’
the sector/company/country levelof
recovery patterns when viewed at the sector/company/country level
HIGH
Hard Reset Surge
Industries/companies that struggle to recover from Industries/companies that scale as consumer behavior
COVID-19 due to “permanently” lowered demand for that was altered due to COVID-19 is sustained in their
offerings, insufficient capital to ride out extended favor. Investors sense their potential to lead and
recession, and/or poor execution of digital transformation. provide capital to scale aggressively during recovery.
• Airlines • Hotels • Online retail • Asset management/PE

Pace of COVID-19 Recovery
• Brick and mortar retail • Restaurants • TMT • Life Sciences/Pharma

• Higher education • Entertainment venues REACT • Food delivery • Interaction platforms
• Energy • Liquidity • Telemedicine • Streaming media
• Customer service
SLOW
• Supply chains
FAST
Every firm must triage
then prepare for the
Transform To Re-emerge likely recovery path Modified Business As Usual (BAU)
Industries/companies that will likely recover but along for their sector Industries/companies seen as daily essentials will
a protracted path requiring reserves of capital to endure suffer effects of the consumer shutdown and
and transform operating models to emerge stronger and potential recession but will likely recover more
more in line with changing consumer priorities. quickly as consumer demand returns in similar
volumes.
• Travel and leisure • Professional services
• Automotive (bias to electric) • Insurance • Banking • Agriculture
• Durable goods • Healthcare • Consumer goods • Transportation
• Other industrial manufacturing • Real estate/Construction
LOW
Degree of Permanent Change to Industry Economics/Value Chain

Source: KPMG Market Intelligence, August 2020.
Enterprise reboot 9
Uncertainty
Since COVID-19 has upended business as usual, many companies
need to accelerate their use of emerging technologies faster
than ever before. Yet they are simultaneously dealing with an
threatens unparalleled level of uncertainty across the business landscape.

Looming over everything is fear of new spikes in case numbers.
current Despite the burning platform for new

technology, many enterprises are
Some industries, such as airlines,
hotels, restaurants and brick-and-mortar
investments struggling to find dollars to invest

in digital transformation. Average
investments in emerging technologies
retail, are in especially precarious
positions. Anticipating permanently
lowered demand for offerings and
have been slashed by millions of dollars with insufficient capital to ride out an
across industries and company sizes. extended recession, these industries
Approximately 4 in 10 executives say will need to make a hard reset to
they will halt investment in emerging recover. Other industries, such as travel,
technology as a result of COVID-19. industrial manufacturing, insurance and
Only 13 percent expect to significantly real estate, also face a slow recovery
increase investments. that is dependent on reserves of capital
to transform operating models in line
As cash becomes increasingly critical
with changed customer priorities.
for survival, companies are turning to
the classic recession tactic of instant Traditional digital transformation has
budget myopia. The need to generate always been correlated with more
and preserve liquidity is causing investment. Now industries that were
organizations to pull back or delay certain most susceptible to COVID-19 risks
emerging technology projects in order to must do the opposite: capitalize on
meet immediate financial objectives in emerging technology without increasing
the pandemic’s wake. budgets, and at a pace and scale that is
much faster than their usual timeline.
ONLY
13% s ay their
organization
will invest
significantly more in
emerging technologies
as a result of COVID-19.
10 Enterprise reboot
INDUSTRY INSIGHT: HP
At HP, which handles more than five hundred
thousand paper invoices annually, a multi-phased
project is underway to leverage optical character
recognition (OCR), AI and ML technology to automate
the end-to-end accounts payable invoicing process,
from data capture, to business rule validation, until
posting. COVID-19 has pushed up the timeline for
results. The company is now focused on aiming
to deploy and scale the technology as well as train
employees on the solution within the next six months.
As a company, we are always re-

prioritizing in an agile way to get the
best returns possible. COVID-19 has
created an opportunity to re-think
where and what we invest in, always
keeping the bigger picture in mind. We
are focusing on “better ROI” choice
points where we know there’s room to
maximize our long-term returns, while
also realizing quick wins in parallel.
– Bobby Jutley,
Director RPA - Simplify Finance Innovation, HP
Enterprise reboot 11
Expect companies According to Paul Henninger, Partner came together to innovate solutions to
and Head of Lighthouse for KPMG these truly unprecedented challenges.
to be more selective in the U.K., in many cases, emerging Companies explored a lot of ideas:
in terms of where they technology proposals are being some good, some bad, some realistic,
subjected to greater scrutiny as some unrealistic. Now we are seeing a
invest in emerging
enterprises cope with immediate return to a more pragmatic approach to
technology because financial challenges and prepare for technology adoption.”
recession. Only investments with
the stakes are higher Tim Denley, Partner in Charge of
crystal-clear goals, laser-focused
Solutions for KPMG in Japan, is also
now. Understanding adoption and deployment plans, and rich
seeing smaller and more focused
what is possible return potential are likely to be approved.
emerging technology investments.
versus what is not, “The transition from COVID-19 C-suites and boards are working to
response to recovery has initiated a optimize the investment portfolio to
and when and where slight return to caution,” Henninger focus only on projects that will bring real
to use new technology says. “When the crisis began, new and immediate value.
technology ideas proliferated as people
to drive tangible value,
are the key decision
Spending intentions delayed, but many expect to
points. Spending intentions pushed out, but many expect to increase within next 12 months
increase within next 12 months
How do you anticipate COVID-19 to impact spending in the next 12 months?
How do you anticipate COVID-19 to impact spending in the next 12 months?

– Oleg Brodski, +18% +8% +4% +1% +9% +17% -3%
Partner, Head of
Lighthouse,
KPMG in Germany 44% 39% 34% 34% 38% 43% 32%
26% 31% 30% 33% 28% 25% 35%
5G Artificial Blockchain Edge Hybrid cloud Process Smart

Intelligence (AI) computing and/or automation analytics
multi-cloud
Increase Decrease
44% of executives expect to increase spending on 5G in the next 12 months, while

26% expect to decrease it. A similar story for process automation, with 43% of
executives expecting to increase spending and 25% expecting to decrease.
“The pandemic has driven a huge Given this shift in perspective, it makes And the good news is that all recessions
change in the perspective and focus sense that organizations that have been eventually end. For most emerging
around technology,” says Denley. “For able to scale up emerging technology technologies, investment plans have
the most part, it’s helping refocus efforts initiatives despite the challenges are not disappeared for good, but have
in the places that will have the most now focused on longer-term objectives, been pushed to the future. Our research
value. Enterprises are doubling down such as company valuation, brand indicates that over the next 12 months,
and even accelerating investments in recognition, and topline growth, as some emerging technology spend is
core technologies such as cloud, AI, and opposed to traditional productivity and expected to grow, with a focus on AI,
automation given the uncertainty of the efficiency measures. 5G, automation, and cloud technologies.
environment right now.”
Average investments in emerging technologies have declined

Average investments in emerging technologies have declined across industry and company s
across industry
What is your current level of investment for these emerging technologies in your organization (or business unit)
What is your current level of investment for these emerging technologies in your organization (or business unit)?
Weighted Average Spend • $M

Key insight: The
Travel, hospitality & logistics $15 industries most
$12.4
impacted by
$15 COVID-19 - airlines,
Manufacturing
$11.6 hotels, restaurants,
retail - realize they
Retail & CPG $13.8 need to boldly seek
$8.5 new solutions, and
have only nominally
Energy & utilities $18.2
reduced emerging
$13
tech spend during
Insurance $14.1 the pandemic. An
$8.4 airline executive told
us about his company’s
Telecom, media, and high-tech $15.5 need to fast track airport
$8.8 remodeling. A retail
executive stressed the
Government / public sector $15.8
$9 importance of rapidly
expanding his company’s
Banking & financial services $17.1 virtual presence. Since
$9.2 the shutdown, we’ve
also seen how logistics
Healthcare & life sciences $19.1 companies have
$9.4
become more essential,
playing a critical role in
Mar-Apr May-June
transporting supplies
Sample: 300 executives (May-June 2020, Phase II sample) and 600 executives (March-April 2020, Phase I sample) across Global 2000 and keeping commerce
enterprises. Source: HFS Research in conjunction with KPMG International. moving.
Investment
Although some new technology spending is temporarily frozen
in some sectors, our research shows that the pandemic is
increasing investment clarity. Budget pressures and operating
clarity found model stressors are forcing organizations to prioritize areas that
bring important near-term benefits over technology investments
with a longer time horizon to value realization.
Focus on “have to haves” Hybrid cloud models top the agenda,

far surpassing other cloud strategies,
Generating massive uncertainty,
including multi-cloud, that dominated
COVID-19 has increased interest in
pre-crisis. Major enterprises are
emerging technology projects that can
planning to adopt this architectural cloud
deliver quick cost savings or growth.
approach in the future to reduce risk of
Enterprises are focusing in on the
service disruption, extend the corporate
“have to haves” over the “nice to
network and functional workloads, take
haves,” prioritizing projects designed
advantage of the best available services
to strengthen business resilience and
and features, and improve overall
protect the company’s future.
flexibility and interoperability of the
The primary focus of current business.
investments is on more mature
According to Priya Emmanuel,
technologies such as cloud, automation,
Managing Director of Cloud Strategy
and analytics that will help organizations
and Transformation at KPMG in the U.S.,
respond to current problems, drive quick
KPMG professionals have recently seen
ROI, and maintain the future trajectory.
more dynamic cloud transformation
because companies can really see
Cloud floats to the top of the list
how cloud enables working in a virtual
Cloud computing is at the heart of
environment.
emerging technology discussions.
Reflecting the fact that COVID-19 Emmanuel says most companies
revealed the power of digitally native understand the tangible benefits of
processes, 56 percent of executives cloud: as a platform for the convergence
agree that cloud migration has become of technologies, it is ultimately a vehicle
an absolute necessity. Instead of for value creation, collaboration, and
piecemeal migrations of small datasets, competitive advantage. The daunting
many companies are now intent on task is figuring out how to digitally re-
moving an entire function’s data to the architect the business leveraging cloud,
cloud at scale. while continuing to deliver day-to-day
56%
business services.
s ay cloud
migration has
become an
absolute necessity due to
COVID-19.
INDUSTRY INSIGHT: AMERICAN EXPRESS
COVID-19 budget pressures have not slowed spending on
strategic automation projects. American Express Finance
continues to stay strongly focused on its investment in chatbots
and natural language processing solutions, which have already
delivered enormous benefits to the Finance Division. According
to Oulton, chatbots can answer 70-80 percent of customer
questions coming in via email and other digital channels, taking
the heavy lift off humans and helping employees work more
effectively and strategically in the remote world.
American Express is responding to COVID-19

by focusing on ways we can serve our customers
better. That means pushing pause on certain
projects, such as non-critical infrastructure
work, and repurposing that capacity to enhance
digital capabilities across the company. We are
reinvesting particularly in the automation space,
where we see tremendous potential for cost
takeout for years to come.
– Todd Oulton,
Vice President, Automation,
Center of Excellence, American Express, Finance
When it comes Despite the positive outlook for hybrid possibility of doing it wrong and making
cloud, companies have a way to go to environments less secure. IT needs
to cloud, many realize the potential of this newer cloud to figure out how to keep up with new
companies have been computing strategy. Only a minority of workloads and tools to make sure they
executives consider their organizations’ are well functioning, well managed, and
comfortable moving
capabilities in cloud technology to be well secured.
at their own pace and strong.
To succeed with cloud adoption and
doing the easy things Companies often invest in increasing scale, operating model change is
efficiency through cloud, knowing it critical. Companies must educate the
first—one application
will help them reduce costs, but our organization about all of the tangential
at a time, one proof-of- research shows that they don’t fund functions that need to change
concept at a time. The and manage IT resiliency and security alongside the technology, e.g., vendor
appropriately. While cloud presents an management, upskilling personnel,
COVID-19 situation has opportunity for an extra level of security, security, finance, monitoring, and
put into perspective the complex cloud ecosystem raises the reporting.
how unprepared
many organizations
are to suddenly
Hybrid
Hybridcloud
cloudhas
hasbeen
beenprioritized,
prioritized, while
have to do things multi-cloud
while takestakes
multi-cloud a backseat
a backseat
differently. It is forcing Most
Mostimportant cloudcloud
important investment
investment
companies to really
51% think strategically and Multi-cloud deployment 51%
deliberately about 15%
changing the way

Microservices 11%
they operate to 18%
become more
cloud-enabled. Hybrid cloud deployment 25%
45%
– Priya Emmanuel,
Containerization 13%
Managing Director,
23%
Cloud Strategy and
Transformation, Mar-Apr May-June
KPMG in the U.S.
Short-term wins with low-code robotic process automation (RPA), “Most companies had a digital
automation low-code/no-code development transformation agenda even prior to
Automation is a key building block platforms, and process-mining software COVID-19. But now, with operating
of future digital transformation—a as more important. Low-code tools— models under duress, they need to
gateway technology to driving value which bring solutions from across the rapidly accelerate that agenda,” Lohr
from analytics, AI, and other emerging automation spectrum together under says. “Low-code technology is an
technology initiatives. By leveraging one fully configurable umbrella—show enabler of the digital transformation
automation, businesses can not only a particularly staggering increase in journey. Bringing in one automation
improve operational efficiency and adoption between survey phases. technology is only a short-term stopgap;
effectiveness, but also build a strong it’s platforms that allow enterprises to
According to Todd Lohr, Principal
foundation for new or enhanced address end-to-end automation.”
of Technology Enablement &
products and services that engage
Automation, KPMG in the U.S., low- For example, KPMG in Canada recently
customers and drive revenue growth.
code automation solutions make it worked with a company that supports
possible for companies to adapt to hundreds of long-term care facilities
As the new reality unfolds, automation
changing business environments. to implement automation and other
priorities are shifting towards
Truly transforming a complex process emerging technologies to improve
more advanced, strategic, and
or automating large pieces of work scheduling and staffing of clinical and
transformational capabilities. In the
require a combination of multiple non-clinical staff. Before the crisis, it
Phase I survey, business process
technologies. Lohr believes that low- took a team of 50+ employees two full
management software (BPMS)—tools
code development platforms are literally weeks to build two-week schedules
used to optimize or augment existing
the strategic tool bench from which for each site of care. KPMG in Canada
processes—ranked as the most
enterprises can drive true large-scale created a technology solution that
important automation investment. In
digital transformation. helped the company schedule 8,000
the Phase II survey (after COVID-19
shifts in 20 minutes.
accelerated), respondents ranked
Investment skyrockets in low-code/no-code, while BPMS drops significantly

Most important automation investments
Most important automation investment
BPMS (Business process 44%

management software) 17%
BPMS ranked as the most
important automation
Process mining software 20% investment in the Phase I
26% survey, while Phase II
respondents rated RPA,
low-code/no-code, and
Low-code/no-code 10% process mining software
development platforms 26% as more important after the
acceleration of the COVID-19
crisis.
RPA (Robotic process 27%
automation) 31%
Mar-Apr May-June
COVID-19 Looking forward, automation will necessary precursory steps: digitizing
be a key building block of digital company data and processes, building
moved customers transformation—a gateway technology a trusted data backbone, and investing
from physical points to driving value from analytics, AI, and in self-service business intelligence
other emerging technology initiatives. platforms and insight generation.
of contact to online
By leveraging automation, businesses
However, although enterprises are
channels suddenly and can improve operational efficiency
striving to drive value from data, only
and effectiveness, and also build a
rapidly. Enterprises are a minority of executives consider their
strong foundation for new or enhanced
organizations “strong” across the
trying to understand products and services that engage
analytics lifecycle.
whether these shifts customers and drive revenue growth.
Traci Gusher, Principal, Data Analytics,
are permanent and Analytics: From real-time analysis KPMG in the U.S., says there’s
what that means to predictive modeling significant work to be done from an
Enterprises have increased their organizational perspective to gain the
for the business. As investments in smart analytics since digital fluency needed to derive real
people start to leave the pandemic hit. Businesses were value from AI and analytics. Analytics
looking to beef up their data analytics initiatives are often mistakenly viewed
a much larger digital
capabilities even before COVID-19 drove as a technology issue alone, when
footprint compared to customers and employees to virtual they also impact people, processes,
ownership, incentives, ethics, and many
what was normal and touchpoints. Now, with large segments
of employees working remotely and other aspects of the business. Lack of
expected one year ago, more customers interacting with effective communication and training
advanced analytics can businesses online, enterprises are trying also prevents analytics investments
to advance their analytics capabilities from reaching their full potential. In
play a major role in an to capitalize on insights drawn from many organizations, people across the
enterprise’s ability to widening digital footprints. business are not aware of what they
can do with analytics tools and insights,
understand and take The focus for most analytics
including what questions to ask or how
investments today is strengthening
action on customer to apply findings.
the data infrastructure to create an
behavior. integrated platform from which to
generate, collect, and act on insights.
Many organizations are taking the
– David Slánský,
Partner, Data Analytics,
KPMG in the
Czech Republic
Maturing enterprise data platforms impact of different COVID-19 scenarios Enterprise-wide
will set the stage for businesses to on macroeconomic factors such as
capitalize on more advanced analytics buying power of the population, prices
analytics require a
and predictive modeling. Poised to for commodities, unemployment, etc. strong handle on the
become bigger areas of investment, Ultimately, they were able to advise the
data. Analytics built
these data-science techniques enable client on what the findings meant for
organizations to anticipate future events their market, customers, raw materials on data that is in bad
and outcomes with a high degree of and costs.
shape can’t be trusted.
accuracy, providing new opportunities
The overall success of analytics
for growth. Only organizations
initiatives depends on the strength of
Improving forecasting has become the enterprise-wide data governance, that get serious about
an especially critical need during the management and transformation data governance,
COVID-19 pandemic. Given the nature program, says Gusher. A strong program
of the crisis, historical data no longer helps build trust in the data, integrate
management, and
points to what the future holds. The analytics initiatives into business transformation
only way to realize real forecasting processes, and provide continual
can build leading
power will be to capitalize on real-time oversight as changes in the internal and
data—including data from outside the external environment occur. enterprise analytics
organization’s walls—in order to predict
capabilities.
new signals that indicate future financial,
supply chain, inventory, customer
demand, and other changes. – Traci Gusher,
Principal, Data Analytics,
As the COVID-19 crisis unfolded,
KPMG in the U.S.
KPMG in Germany leveraged predictive
forecasting to improve financial planning
in a German manufacturing company.
The German firm used data science and
mathematical modeling to calculate the
New With the global economy in recession and financial performance
under threat, many enterprises are adopting a “do more with
less” mentality, taking dollars away from experimental projects
opportunities that may not deliver immediate payoff. Many businesses have
put investments in cutting-edge technologies on hold, unless
for promising there is a specific case for acting right now.
Investment reductions are expected Everywhere, anytime work: 5G and
technologies in the near term for certain emerging

technologies, such as 5G and edge
computing, AI, and blockchain. At the
edge computing
The sudden work-at-home environment

driven by the COVID-19 lockdown has
same time, rapidly shifting business
driven even greater interest in 5G.
priorities are creating new opportunities
and use cases for these technologies as 5G advocates say the next generation
the new reality progresses. of internet technology will bring about
an exponential change in the speed,
Since COVID-19 hit, some technologies are being

prioritized while others have seen short-term
spending cuts
What is your current level of investment for these emerging technologies
in your organization (or business unit)?
Weighted Average Spend* • $M Percent

Reduction
Smart analytics $14.6 Relatively
$12.7
13% smaller
investment
reductions
Process automation $14.2 in “have-to-
21%
$11.1 have” mature
technologies
Hybrid cloud and/or multi-cloud $16.5 that drive
$13.5 18% quicker ROI
Edge computing $15.5

61%
$6.1
Deeper
Blockchain $18 investment
63% reductions
$6.5
on nascent
Artificial Intelligence (AI) $17.2 technologies
45% with a longer
$9.4
time horizon
5G $16.5
$8.3 50%
Mar-Apr May-June
scale, and security of the world’s digital continuously adjusts production to meet graphics and content streamed to
connections, from people to products to demand. Manufacturing performance multiple players simultaneously.
enterprises. The first major shift, already can be truly transformed by speeding
AI plays a bigger role
underway, will be a new workplace up data transfer to facilitate predictive
AI is poised to pervade every aspect of
paradigm: remote work models as maintenance, 24/7 asset monitoring,
21st-century enterprises, from data to
productive and rewarding as in-office minimal downtime, and improved safety.
processes to talent to risk management.
models.
–Connected healthcare: The healthcare
Our research shows that the focus of AI
According to Alex Holt, Global Head sector is arguably the biggest beneficiary
initiatives is evolving away from machine
of Telecoms and Media, KPMG of better data and AI. Patients can be
learning, which uses algorithms to parse
International, 5G in combination with monitored constantly via sensors that
and learn from structured data, towards
edge computing will be key to the global collect and analyze health information
deep learning—artificial neural networks
economic recovery after COVID-19. 5G and alert physicians and caregivers to
that can learn and make intelligent
provides the capability to support billions issues. The hospital of the future can
decisions on their own. Enterprises also
of connected devices transmitting huge also track the location and performance
plan to ramp up investments in digital
volumes of data. Edge computing, which of its high-value medical equipment.
assistants, natural language processing
moves processing power closer to the
–Intelligent transportation: Data (NLP) and computer vision, AI systems
user, has the potential to dramatically
from sensors can be aggregated and that extract information from text, audio,
improve speed, bandwidth, and latency of
transmitted to transit operators to images, and videos.
applications.
alert them to performance issues and
Many enterprises are now looking
Together, these technologies have problems and keep passengers up-to-
for AI to play an even bigger role in
the potential to transform the way we speed on schedule times and delays.
the new environment, helping solve
work in a wide variety of industries. Traffic management will be easier
challenges that arose when employees
Employees can enjoy a better remote with real-time updates on hotspots,
and customers went into lockdown.
work experience, with increased access roadwork, and accidents, while parking
Since the early COVID-19 wave, KPMG
and enhanced functionality, which in turn will become less of a hassle with instant
member firms have seen a sizeable
will improve productivity. In addition, data- identification of free spaces.
uptick in interest in large AI projects, such
intensive and other jobs that historically
–Environmental monitoring: Effective as enterprise-wide, customer-facing
required a physical presence will also
monitoring helps detect signs of conversational agents that have shown
have virtual options. “Everywhere,
environmental harm and near real-time they can remove upwards of 25 percent
anytime” work, just as effective as it is on
transmission of data enables quick of the workload from call centers.
site, will truly be possible.
mitigation. Environmental and healthcare
KPMG in Australia helped a large
These converging technologies also hold agencies, as well as local authorities,
telecommunications center automate
promise to transform industry business can access and analyze complex data
existing call center operations using AI
models and outcomes. The value of 5G from multiple sources to make informed
chatbots and voice agents. Previously, the
and edge computing across five key decisions related to diverting traffic,
business was struggling to cope with high
sectors is expected to reach more than limiting access to geographical areas, or
volumes of new requests as people found
US$500 billion by 2023, according to acting against harmful substances.
the need to update their services due to
recent research from IDC and KPMG in
–Gaming: 5G and edge computing COVID-19 disruption. The AI solutions
the U.S.1
will literally take gamers into a new created new customer touchpoints and
Industry-specific applications include: reality. The emergence of AR/VR is handled greater volume than humans
–Industrial manufacturing: The world creating vivid and realistic experiences alone could manage.
is moving toward highly autonomous that require ultrafast connectivity and
factories, where sensors gather and very low latency to support advanced
analyze data from every corner and AI
1 The 5G edge computing value opportunity (KPMG in the U.S., 2020)
© 2020 KPMG International

LLP, a DelawareCooperative
limited liability
(“KPMG partnership
International”).
and theKPMG
U.S. member
International
firm ofprovides
the KPMGno client
networkservices
of independent
and is a Swiss
member
entity with
firms
which
affiliated
the independent
with KPMGmember
International
firmsCooperative
of the KPMG(“KPMG
networkInternational”),
are affiliated. a Swiss entity. All rights reserved.
INDUSTRY INSIGHT: MICROSOFT
Microsoft is making many of its technology solutions
widely available to its customers and partners.
Frontline workers are leveraging Microsoft’s
Dynamics 365 and Power Platform to automate
emergency response. The company also rolled out
the HealthBot to reduce misinformation about the
virus, enable healthcare providers to better triage care,
and reduce stress on the healthcare system. And
to support virus research, Microsoft’s AI for Health
team is providing nonprofits, academic institutions,
and governments with data dashboards and cloud
computing resources to help scientists
and policymakers make more informed
decisions.
We’re all in this crisis

together, and we believe
collaboration is what will get
us through it. That’s why we’re
publically sharing our innovative
tools for coordinating patient care,
maintaining business continuity, and
accelerating disease research and
vaccine development.
– Jaime Pereña,
Director of Marketing and Strategy,
Enterprise Artificial Intelligence, Microsoft
To capitalize on the promise of AI, The second challenge is the fact One of the
enterprises will need to overcome two that insufficient policies and actions
primary challenges. First is a lack of to ensure ethics around AI are also
major AI challenges
quality data, which more than 60 percent suppressing results. AI has the power is extracting and
of executives cite as a significant barrier to profoundly change how work gets
maximizing the
to value creation. Many organizations done and decisions get made, but it
continue to struggle with data, says Traci needs to be deployed responsibly. For value you get from
Gusher of KPMG in the U.S. In order AI to be productive, and accepted in your people while
to keep pace with a rapidly changing the enterprise, it must be explainable,
technology landscape, combined with transparent, and trusted. trying to build out
vendor overload, many companies find AI to do things that
they do not have a good handle on the
MORE THAN don’t necessarily
50%
data that feeds their AI algorithms. As a
result, they cannot trust the outputs of f executives
o have to be done by
AI-driven processes. say a lack of humans. Companies
AI ethics will
make widespread business need frameworks in
MORE THAN place to make sure
adoption challenging
60% c ite a lack of

data quality as
a significant
barrier to creating value
Digitized trust: Blockchain
Blockchain has moved beyond the
hype. It is now emerging as a viable
technology for solving business problems
there are checks and
balances in place for
new technologies,
particularly AI.
Decision-makers also often think IT can related to auditability, security, and
spend a few months fixing important trust—the three key blockchain features – Tim Denley,
data and that’s all it will take to realize AI that are most attractive to executives. Partner in Charge of
results. To be effective, advanced data Although blockchain suffered the Solutions, KPMG in Japan
management should be an ongoing biggest investment loss of all emerging
activity, involving continuous hard work technologies as COVID-19 impacts
and governance. spread, our survey shows spending will
increase in the next 12 months.
According to KPMG’s U.S. Blockchain

Leader Arun Ghosh, in many businesses
the reconciliations between inventory,
suppliers, invoices, and other outputs of
core processes aren’t well understood,
let alone trusted. That’s where blockchain
offers value.
Many initial According to Ghosh, blockchain is the for a single organization; implementing
“digitized version of trust,” allowing something that by nature is intended to
blockchain pilots failed ecosystems to record who did what connect multiple organizations is that
because the business and when on a secure and transparent much more complex.
ledger. As a decentralized database
was focused on One enterprise alone can’t stand up a
with autonomy and consensus in
trust infrastructure on the blockchain: It
what the technology decisions, blockchain enables trust at the
takes an ecosystem. In the aerospace
infrastructure level, building trust all the
can do. Blockchain sector, for example, thousands of
way down to the data and all the way up
upstream and downstream suppliers and
investments to the business itself.
service providers responsible for building
weren’t approached Blockchain has a key role to play in the and maintaining landing gear, cockpit
strategically. The future of business. The principles of digital controls, fuselage parts, tire components,
trust, with blockchain as the technological and more need to participate alongside
better approach is underpinning, are inherent to how web the aircraft manufacturer.
understanding where 3.0 will evolve, especially in a post
Blockchain is also gaining attention as
COVID-19 world, where we will be more
the business needs companies seek to better drive trust
hyper-connected than ever before.
in the supply chain during COVID-19
more trust given how
Both public and private blockchains disruption. When global trade networks
it operates within its exist, but current enterprise adoption break down, blockchain helps companies
is predominantly focused on private establish new relationships quickly based
partner ecosystem and
blockchains. Industries are building on data people can verify and trust.
using blockchain to trust through networks of interoperable,
Other applications based on current
enable trust in those private, permissioned blockchains, with
market conditions include: matching
certain actors serving as trust anchors
targeted processes. for the ecosystem and security built in
supply chain and availability; helping
buyers check the legitimacy and
through permissions.
standards of new partners; tracing
– Arun Ghosh, Ghosh says one of the top challenges the distribution of vaccines from
U.S. Blockchain Leader, when it comes to realizing value from manufacturers to end users to ensure
KPMG in the U.S. blockchain is complexity, including authenticity and respond to possible
understanding what participants you recalls; and tracking COVID-19 loans,
need, what data you need from them, grants, and other funding throughout their
and what incentive models will drive history to ensure the funds are making
participation. It is hard enough to architect their way to the correct parties and are
and implement a system that’s intended being used for the intended purpose.
The case Companies see significant
potential in emerging
technology investments. More
At the heart
of each emerging
for higher than 80 percent of companies

surveyed are investing or
technology adoption
challenge is a lack of
investment planning to invest in emerging

technologies. Four areas—
smart analytics, process
trust. Gaining trust
is a major struggle
automation, hybrid cloud, and when it comes to
cybersecurity—are attracting
digital transformation
dollars from virtually every enterprise that participated in our
survey (99 percent of executives surveyed). In addition, 46 percent because so many
of executives surveyed said their company is making investments tools and solutions are
to take advantage of opportunities resulting from COVID-19
‘black box.’ Although
impacts.
some so-called
The overall level of investment Ramping up emerging technology emerging technologies
varies, but approximately one-third of investments across the board may be
respondent organizations are investing a solution for those who can afford
have actually been
more than US$10 million, with an it. According to our research, the around for decades,
average of $16 million annually per overall level of investment in emerging
many business
technology. technologies correlates with the
strength of returns. decision makers lack a
And yet, despite high expectations and
activity, most companies are achieving Companies in the highest investment strong understanding
softer-than-expected impacts from their quartile for seven of eight technology of how they work,
emerging technology investments. areas achieved significantly greater
Based on their own internal realized value than companies in the what they can deliver,
assessments, less than one-third of lowest investment quartile. In two and what deploying
respondent organizations are driving areas—edge computing and AI—
tangible business value from emerging companies with the highest level of
them can achieve.
technologies, with process automation investment were significantly more
the lone exception. likely to say they have already seen – Brad Fisher, Global Head of
value from their investment. KPMG Lighthouse Data, AI
& Emerging Technologies,
KPMG International
The power of The COVID-19 situation has added For example, KPMG in the Czech
further complexity to technology Republic is working with banks to
emerging technology deployment, forcing organizations implement a new application of digital
is so transformative to reassess the value realized from twins—virtual replicas of physical
emerging technology investments entities such as assets, processes,
that budget should
and pushing out the time horizon for and people. Concerned that economic
not be a limitation. generating results. In the Phase I turbulence due to COVID-19 will cause
survey, a significantly higher percentage more customers to default on loans,
More companies want
of executives said they saw tangible the financial institutions are developing
to explore emerging value to the business from investing in digital models of customer behavior and
technology now emerging technologies compared to the automating collection processes based
Phase II survey. on those analytics.
because they know no
According to David Slánský, who leads
conventional approach data analytics for KPMG in the Czech
can save them. Republic, the time is ripe for enterprises
to open their minds to new emerging
technology applications. Companies in
– David Slánský, crisis will often adopt a “nothing to lose”
Partner, Data Analytics, mindset and try things that have never
KPMG in the Czech before been tried in their area.
Republic
The power The true power of emerging technologies lies in the transformative
capabilities they unleash when integrated together under a
common vision and infrastructure.
of “and” Sixty-four percent of executives agree

with the assertion that the combined
When AI is embedded within enterprise
operations powered by a flexible
use of emerging technologies is much cloud-based architecture, businesses
more beneficial than using emerging can continuously improve their
technologies in isolation. What’s more, offerings based on real-time insights
organizations that strongly agree and quickly adapt to changing markets
with the statement are more likely to and customers to gain and sustain
have realized value from emerging a competitive edge. In working with
technology investments than those that our clients through COVID-19-related
disagree. disruptions, we’ve found that the
surge in digital commerce has spurred
Realizing that the power of “and” is
wider adoption of cloud-enabled
greater than the power of “or,” many
digital, analytics, and machine-learning
organizations are now combining
technologies.
emerging technologies to significantly
64%
enhance their value. For example, in Deployment of rapid-insight solutions
o
f executives more than one-third of all emerging are also enabling businesses to respond
agree that the technology initiatives, business leaders at the rate of change that has taken
combined use are using AI-powered cloud solutions hold during the COVID-19 crisis. For
of emerging technologies and view them as a crucial cog in their example, KPMG in the U.K. used a
is much more beneficial digital transformation efforts. combination of automation, cloud,
than using emerging and analytics technologies to assist
the National Health Service with its
technologies in isolation.
COVID-19 surge response by enabling
hour-by-hour staff reporting of doctors,
nurses, and other healthcare resources
as they shifted throughout the country
to areas of greatest need.
Emerging Organizations investing more in emerging
Organizations which invest more in emerging technologies are a
technology solutions technologies
likely to say they’ve already are alsoseen
moretangible
likely to say they’ve
value from their inves
are an amalgamation already seen tangible value from their investments
How long do you expect before your organization will be able to see
How long do you expect before your organization will be able to see
of different things that
significant value/impact from investing in the following technologies?
significant value/impact from investing in the following technologies?
come together. Each
emerging technology Percent respondents who say that their company is already
seeing tangible value from emerging technology
alone is just an enabler.
Smart 18%
When you put them
analytics 28%
together—combining
intelligence with Process 33%
automation 45%
automation, sensors
and networking to Hybrid cloud and/ 32%
or multi-cloud 32%
build autonomous
systems —you Edge computing 15%
get differentiated 37%
platforms. It’s Blockchain 17%

differentiated 28%
platforms that shift the 18%

Artificial
economic model of the Intelligence (AI) 38%
business, enabling it to
5G 14%
compete better, react 20%
to its customer needs
Lowest Highest
faster, and deliver at a investment quartile investment quartile
lower cost point.
Sample: 600 executives across Global 2000 enterprises. Source (Phase I sample): HFS Research in conjunction with KPMG
International.
– Shreeshant Dabir,
Of those executives in the highest investment quartile, 45% are seeing tangible value
National Leader, Data today in process automation, while just 20% are seeing tangible value today with 5G.
Analytics and Lighthouse
Exponential, KPMG
Canada
Superheroes By comparing the size and pace of technology investment with the
impact of those investments, we are able to segment respondent
organizations into four distinct categories of maturity:
and • Superheroes: Significant impact backed by robust investments
Stragglers
• Sidekicks: Slightly behind superheroes but lacking confidence
• Strivers: Robust investments but not realizing value
• Stragglers: Low investments and poor results2
Superheroes average at least US$25 Stragglers tend to have simpler their recognition and treatment of data
million in emerging technology objectives for emerging technology as an asset, and their investment in
investments. They are future-oriented, projects—their main reason for investing organizational capital.
investing primarily to secure their is cost reduction—but their efforts are
Superheroes are twice as likely as
competitive lead and ensure their often hampered by internal issues like
Stragglers to say their company has
continued survival. The industries cultural problems, low risk appetite, and
invested in business and organizational
with the highest concentration of lack of appropriate talent.
expertise, set guidelines for emerging
Superheroes are banking and financial
When we analyzed the spectrum of technology implementation,
services, manufacturing, and telecom,
emerging technology segments, it developed policies around data
media and high-tech.
became clear that culture stands out ethics, and established clear roles and
More than half of Superheroes are as a unique value driver. What really responsibilities for emerging technology-
already seeing value from their differentiates Superheroes is their related activities.
investments. We’ve learned that policies around data to increase trust,
they are now ramping up spending
2T
his analysis is based on a clustering methodology using a k-means algorithm. HFS Research took an average across all disruptive
on foundational technologies like technologies to find respondent groups that best fit six chosen variables: maturity of investment, investment level, growth of
spending, value realized, benefits realized, and relative confidence.
analytics, cloud, and AI that will
serve as the backbone for enterprise-
wide digital transformation. Their
approach and capabilities are Culture is a unique value driver for emerging
already mature, and they are poised technology investments
to continue to deploy emerging
Superheroes are 2X more likely than Stragglers to agree with the
technologies at scale and translate
following statements about their company:
their promise into real value.
•B
eyond technical expertise, we have invested in business and
At the other end of the spectrum are organizational expertise to deploy in the form of COEs
Stragglers, who invest only about one-
•W
e have developed internal policies and procedures that set the rules
quarter of the dollars of the average and guidelines for emerging technology implementations at both a
Superhero. They generally focus on functional and enterprise level
ad-hoc projects in specific areas like
•W
e have developed internal policy and principles for the ethical
hybrid cloud, blockchain, and edge
collection, management and use of data to increase trust from
computing. Industries disrupted
emerging technology implementations
severely by COVID-19—and in dire
•W
e have established clear roles and responsibilities to command,
need of digital transformation—have a
decide, approve, or disapprove the full range of emerging tehnology-
higher proportion of Stragglers. They
related activities
include retail & CPG, travel, hospitality &
Sample: 600 executives across Global 2000 enterprises. Source (Phase I sample): HFS Research in conjunction with KPMG
logistics, and energy & utilities. International.
What’s
How do companies join the ranks of the Superheroes, successfully
leveraging technology to reboot their organizations?
next?
Digital capabilities are now essential to survival. By exposing weaknesses
in digital preparedness and forcing all companies to accept a vastly changed
business environment, COVID-19 is pushing Superheroes even further ahead
of the pack. Meanwhile, Sidekicks, Strivers, and Stragglers are under pressure
to quickly improve their emerging technology capabilities to compete over the
long term.
These are unprecedented times and there is no playbook for moving forward. But
enterprises at every level of maturity can’t afford to stand still. Our work with clients
has uncovered best practices for using technology to move forward and realize
substantial value aligned to business objectives during times of disruption. For
example:
Top-line growth is important but not the same as survival of the enterprise. Today’s trying times
will force companies to evaluate everything they do across the enterprise to determine which
Put
initiatives are essential for survival, and budget accordingly. Emerging technology has clearly
survival become essential. Decision-makers should ask themselves: Are potential technology initiatives
first competing for dollars with projects totally outside of the technology arena? What tradeoffs can we
make to get the funds to invest?
An agile organization focuses on the highest-value actions—right now. Prior to COVID-19,

objectives for emerging technology investments were scattered. Today, there needs to be
Prioritize
more focus. The “have to haves” will take precedence. In other words, what is viable, tangible,
investments and has the strongest business case? With a global recession underway, emerging technology
projects should be tied to improvements that are measurable.
It’s time to think differently about how to scale change. Companies need to find ways to break
Scale down large-scale efforts, like digital transformation, into small, bite-sized chunks. Without a
change clear view of what might happen in one, six or even 12 months, it is wise to deploy emerging
intentionally technologies in areas where there is a fairly strong chance of positive outcomes.
Given rapid changes in the business environment, the enterprise’s ability to quickly implement
Take a platforms for ongoing digital transformation is the real market differentiator. Businesses can’t
broad look at emerging technology in a vacuum. A narrow approach won’t drive meaningful change
or achieve the resilience needed for success in the new environment. Rather, combining
view
technologies together is the key to enabling game-changing solutions.
The boundaries between IT functions and the rest of the business were blurring even before
COVID-19, as digitization and automation moved into the front, middle, and back offices. Now,
Integrate
organizations have to integrate technology into organizational structure and strategy consciously.
IT Doing so will help overcome top challenges to emerging technology adoption, which center on
culture, risk appetite, talent, commitment, data, and the business case—not the technology itself.
Data will continue to be a critical decision-making tool. It can’t be an afterthought. Superheroes

Leverage recognize that data has value and manage it as carefully as other corporate assets. Organizations
data as should develop and continue to optimize internal policies and principles for the collection,
an asset management, and use of data in order to embed data insights into core business operations and
increase trust in emerging-technology implementations.
Institutional trust is essential for agility, transformation, and resilience, but it was already eroding
prior to COVID-19. Trust is even more critical now that organizations have to manage several
Make
challenges at the same time. Recovering trust is paramount to joining the ranks of emerging-
trust the technology Superheroes. Organizations that established sophisticated trust infrastructures capable
foundation of responding dynamically were the ones thriving before COVID-19 and are in better positions to
recover.
Superheroes know that organizational changes are required to make any transformation work,
Adapt especially the complex transformations enterprises are pursuing today. Combining emerging
the technologies to drive business value is harder to achieve than isolated deployments of single
technologies. Investing in business and organizational expertise alongside technical expertise, and
organization
governing the transformation itself, are required to guide organizations to success.
About KPMG
The COVID-19 pandemic has revealed the need for digital transformation at a speed and scale we’ve rarely
seen before. To sustain relevance, enterprises must reboot their businesses and operating models both to
achieve short-term wins and to create a roadmap toward longer-term strategic objectives. Technology is
emerging as a key enabler for driving competitiveness in a future that looks very different than today.
KPMG helps organizations across all industries navigate uncertainty and prepare for what’s ahead by
coupling powerful new technologies with business model and organizational changes that can help
deliver value from investments. Our approach centers on the mindset that it’s not just about technology
for technology’s sake. It’s about using technology to drive value in the enterprise and enable growth.
Therefore, there are no one-size-fits-all solutions. Instead, we strive to meet clients where they are so they
can survive disruption, capitalize on changes in societal dynamics and customer behavior, and plot a course
toward long-term resiliency.
Our work is enabled by deep domain expertise, experience helping clients and our own global organization
address numerous business disruptions, our suite of emerging technology solutions, and a practical
approach to enterprise-wide digital transformation.
About HFS Research

Insight. Inspiration. Impact
HFS Research is a widely acclaimed global industry analyst firm covering the critical people, process and
technology strategies impacting major organizations. The HFS mission is to provide visionary insight into
the major innovations impacting business operations: Automation, Artificial Intelligence, Blockchain,
Internet of Things, Digital Business Models and Smart Analytics. HFS defines and visualizes the future of
business operations across key industries with its OneOffice™ Framework.
Led by award-winning analyst Phil Fersht with analyst teams based in North America, Europe and Asia/
Pacific, HFS is leading the industry with its accessible digital research model that has over two million
visitors per year.
HFS influences the strategies of enterprise customers, to help them develop OneOffice backbones to be
competitive and to partner with capable services providers, technology suppliers, and third-party advisors.
The “As-a-Service Economy” and “OneOffice” are revolutionizing the industry.
For more information, visit hfsresearch.com
Authors
Cliff Justice Phil Fersht
Cliff is the Global lead for Intelligent Automation and the U.S. Phil is CEO and Chief Analyst of HFS Research. He is a
lead for Digital Capabilities. He is a recognized authority on world-renowned analyst, writer and visionary in emerging
emerging technologies -- sought-after as a media commentator technologies, automation, digital business models, and the
and author of numerous articles and publications on the impacts alignment of enterprise operations to drive customer impact
of artificial intelligence and automation on enterprise productivity and competitive advantage. He regularly contributes to key
and the workforce. Cliff has more than 25 years’ experience in media publications and is a regular keynote speaker at major
global sourcing and enterprise transformation, including client industry events, such as NASSCOM, ANDI, ABSL, Sourcing
work in the areas of business services strategy, technology, Interests Group and HFS Research “FORA” Summits. He
operating model design and operation. Cliff has led more than was named Analyst of the Year in 2016 for the third time by
50 significant business transformations for Global 1000 firms, the Institute of Industry Analyst Relations, which voted on 170
and has a long and proven track record of helping organizations other leading IT industry analysts.
derive tangible value from their technology investments.
Phil Fersht
Cliff Justice CEO and Chief Analyst
Global lead for Intelligent Automation and HFS Research
U.S. lead for Digital Capabilities, KPMG International phil.fersht@hfsresearch.com
cjustice@kpmg.com
713-319-2781
Client Contributors: KPMG Contributors:

Bobby Jutley, Director RPA - Simplify Finance Innovation, HP Oleg Brodski, Partner, Head of Lighthouse, KPMG in Germany
Todd Oulton, Vice President, Financial Integrity Initiatives, Shreeshant Dabir, National Leader, Data Analytics and Lighthouse
American Express Exponential, KPMG in Canada
Jaime Pereña, Director of Marketing and Strategy, Enterprise Tim Denley, Partner in Charge of Solutions, KPMG in Japan
Artificial Intelligence, Microsoft Priya Emmanuel, Managing Director, Cloud Strategy and
Hans-Aloys Wischmann, Program Manager for Artificial Transformation, KPMG in the U.S.
Intelligence, Precision Diagnosis, Philips Brad Fisher, Global Head of KPMG Lighthouse Data, AI & Emerging
Technologies, KPMG International
Arun Ghosh, U.S. Blockchain Leader, KPMG in the U.S.
Traci Gusher, Principal, Data Analytics, KPMG in the U.S.
Paul Henninger, Partner and Head of Lighthouse, KPMG in the U.K.
Steve Hill, Global Head of Innovation, KPMG International
Alex Holt, Global Head of Telecoms and Media, KPMG International
Taylor Krislov, Director of Strategic Research, KPMG Market
Intelligence
Todd Lohr, Principal of Technology Enablement & Automation,
KPMG in the U.S.
David Slánský, Partner, Data Analytics, KPMG in the Czech
Republic
KPMG member firm contacts
Brad Fisher France The Netherlands

Global Head of KPMG Lighthouse Data, Romain Lamotte Maurice op het Veld
AI & Emerging Technologies Partner Partner
KPMG International Lighthouse, Data & Analytics and Lighthouse Leader
Partner, KPMG in the US Artificial Intelligence KPMG in the Netherlands
E: bfisher@kpmg.com KPMG in France E: ophetveld.maurice@kpmg.nl
E: romainlamotte@kpmg.fr
Australia United Kingdom
Guy Holland Germany Paul Henninger
Partner in Charge, KPMG Digital Oleg Brodski Partner
Delta and Technology Advisory Partner Lighthouse Leader
KPMG in Australia Lighthouse Leader KPMG in the U.K.
E: guyholland@kpmg.com.a KPMG in Germany E: paul.henninger@kpmg.co.uk
E: obrodski@kpmg.com
Canada United States
Shreeshant Dabir India Cliff Justice
National Leader Sachin Arora Global lead for Intelligent Automation
Data Analytics and Lighthouse Partner and Head of Lighthouse and U.S. lead for Digital Capabilities
Exponential (Analytics, AI & Big Data) KPMG International
KPMG in Canada KPMG in India E: cjustice@kpmg.com
E: sdabir@kpmg.ca E: sachina1@kpmg.com
Japan
Tim Denley
Partner in Charge of Solutions
KPMG in Japan
E: Timothy.Denley@jp.kpmg.com
The information contained herein is of a general nature and is not intended to address the circumstances of any particular
individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such
kpmg.com/us
information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on
such information without appropriate professional advice after a thorough examination of the particular situation.
The views and opinions expressed herein are those of the interviewees and survey respondents and do not necessarily
represent the views and opinions of KPMG member firms and KPMG International.
Some or all of the services described herein may not be permissible for KPMG audit clients and their
affiliates or related entities.
© 2020 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of
independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm
has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG
International have any such authority to obligate or bind any member firm. All rights reserved.
The KPMG name and logo are registered trademarks or trademarks of KPMG International.

Enterprise-reboot

Uploaded by

Enterprise-reboot

Uploaded by

Enterprise

2020 Global Emerging Technology Survey Report

A collaboration between KPMG International

ready? impact of each of these emerging technologies

The collaborative study between KPMG International and HFS Research

Cliff Justice Phil Fersht

Resiliency requires a completely new playbook.

Spending cuts for enabling technologies are likely short term.

The crisis is driving clarity in technology investments.

The power of AND is greater than the power of OR.

With higher investments comes more realized value.

technology mindset prior to COVID-19 have been much more successful at

essential strong foundation for the future business environment.

for survival Now, as enterprises deal with the

Systems for teleradiology have

Additionally, companies are no

On-going governance 8 N/A

Lack of funds to invest 9 N/A

Top objectives for investments in Top objectives for investments in

Artificial Intelligence Cost reduction Essential for future survival

Smart Analytics Improve decision making Essential for future survival

Hybrid and/or Multi-cloud Cost reduction Essential for future survival

COVID-19 is driving massive market shifts around the

The fact is that rapid development, adoption and integration

I believe that organizations will have to get trust right

to recovery As companies work to reestablish

Varying degrees of risk exposure to COVID-19-driven shifts will result in a variety

• Airlines • Hotels • Online retail • Asset management/PE

• Brick and mortar retail • Restaurants • TMT • Life Sciences/Pharma

Degree of Permanent Change to Industry Economics/Value Chain

threatens unparalleled level of uncertainty across the business landscape.

current Despite the burning platform for new

investments struggling to find dollars to invest

As a company, we are always re-

How do you anticipate COVID-19 to impact spending in the next 12 months?

26% 31% 30% 33% 28% 25% 35%

5G Artificial Blockchain Edge Hybrid cloud Process Smart

44% of executives expect to increase spending on 5G in the next 12 months, while

Average investments in emerging technologies have declined

Weighted Average Spend • $M

Focus on “have to haves” Hybrid cloud models top the agenda,

American Express is responding to COVID-19

changing the way

Investment skyrockets in low-code/no-code, while BPMS drops significantly

BPMS (Business process 44%

for promising there is a specific case for acting right now.

Investment reductions are expected Everywhere, anytime work: 5G and

technologies in the near term for certain emerging

The sudden work-at-home environment

Since COVID-19 hit, some technologies are being

Weighted Average Spend* • $M Percent

Edge computing $15.5

1 The 5G edge computing value opportunity (KPMG in the U.S., 2020)

© 2020 KPMG International

We’re all in this crisis

60% c ite a lack of

According to KPMG’s U.S. Blockchain

for higher than 80 percent of companies

investment planning to invest in emerging

of “and” Sixty-four percent of executives agree

platforms. It’s Blockchain 17%

platforms that shift the 18%

and • Superheroes: Significant impact backed by robust investments

An agile organization focuses on the highest-value actions—right now. Prior to COVID-19,

Data will continue to be a critical decision-making tool. It can’t be an afterthought. Superheroes

About HFS Research

For more information, visit hfsresearch.com

Client Contributors: KPMG Contributors:

Brad Fisher France The Netherlands

You might also like

60% c ite a lack of

and • Superheroes: Significant impact backed by robust investments