Businesses that build digital capabilities through a combination of apps, APIs and analytics are seeing revenues rise
More than one in three UK companies surveyed say digital improvement is their top priority; however, most are focusing on simply building mobile apps and not incorporating the API and analytics programs necessary for enabling digital business. This is according to a new study of 252 senior executives and IT decision makers across the UK in four major industries by Apigee®.
The Apigee Institute’s 2015 UK Digital Business Survey Snapshot reveals that apps alone may not be enough to harness the full potential of digital business; effective digital transformation comes from implementing a powerful combination of apps, APIs, and analytics. The report finds that companies that are investing in these core digital technologies are eight times more likely to report increased revenue from digital activities than those who delivered apps alone.
This advantage is not simply a matter of number of companies with increased revenue from digital, but also a matter of degree. The respondents who only delivered apps yet saw increased revenue reported a median of about £266,000 in increased revenue. In contrast, the respondents who invested in apps, APIs, and analytics saw median returns of over £9,000,000.
Ground continues to shift
The Apigee Institute report reveals that 79 per cent of UK businesses in the banking, travel and tourism, telecommunications and retail industries are seeing a fundamental shift in customer expectations due to digital growth. The same proportion recognise that disruption from digital activities has already occurred in their industry. Possibly as a result, more than eight out of ten (86 per cent) respondents report an existing company-wide digital transformation initiative. To deliver on this, 71 per cent of respondents report that their company deployed mobile apps in the twelve months before the survey.
Bryan Kirschner, director of the Apigee Institute, said: “In what’s rapidly becoming a mobile-first business world, all manner of industries are being ‘shaken up’ by digital innovation. The growing sophistication of digital technology and increasing customer expectations are creating new demands for enterprises. Regardless of industry, every business needs to change the way it interacts with customers and partners – using data and digital technologies to create new digital experiences, new efficiencies, and to grow and expand faster in today’s digital world.”
Putting customer experience first
With the proliferation of mobile devices and apps, many UK businesses are seeing opportunities to connect with customers, wherever they are, through digital information and services. According to the survey findings, the top drivers for embarking on digital transformation initiatives among UK businesses include providing best customer experience (37%), new services or experiences for customers (37%), identifying new revenue streams for the business (32%) and remaining competitive (29%). About a quarter (24%) of respondents are also turning to digital activities to help cut costs.
Digital business: more than a mobile app
Seventy-one per cent of respondents deployed a mobile app in the 12 months before the survey, and more than half (55%) plan to offer more services via mobile devices in 2015. But there is still significant work to be done. Significant majorities of those surveyed consider developing APIs (75%) and the ability to collect and analyse big data (77%) important priorities for 2015. Yet, only 26 per cent of surveyed UK executives report plans to deploy new APIs in 2015, and only 35 per cent plan to incorporate big data analytics into their products, processes and services.
According to Kirschner, “We believe businesses need to move beyond merely rolling out mobile apps and instead look more holistically at how they can understand and add value to their customers using data insights and analytics. Our research shows that only 10 per cent of ‘app-only’ companies have seen an increase in revenue from their digital efforts versus 81 per cent of those who have incorporated data analytics and implemented APIs along with their deployed apps.”
Enterprises that have taken action in the past year on three digital capabilities—apps, APIs, and analytics—may have won themselves an edge in the new digital economy. Compared to those who only reported deploying a mobile app in 2014, respondents who delivered this ‘digital trifecta’ are more than twice as likely (41% to 15%) to have seen an increase in their ability to innovate. And while they have an edge on cost savings to date—63 per cent report savings versus 49 per cent of ‘app only’ companies—they dominate on using digital to drive top-line growth in that they are eight times more likely to report increased revenue from digital activities than those who delivered apps alone.
UK business leaders in this survey report that their top three barriers to digital transformation come in the form of limited budgets (35%), poor IT infrastructure (29%), and restricted executive support (25%).
“The research tells us that the majority of UK businesses acknowledge that digital transformation is critical for their business, and are also recognise the importance of data analytics and APIs as part of this journey,” adds Kirschner. “Data is the fuel that enterprises use to engage with, understand and bring value to its customers, market and business. Data is delivered by APIs and customers engage with data through easy to use mobile apps. Together, data, APIs and apps are the core constructs of digital business.”
Tänak wins easily in the Arctic as Rovanperä grabs early title lead
Finn becomes youngest ever WRC leader with Belgian Neuville back in third.
Ott Tänak sealed a dominant start-to-finish victory at Arctic Rally Finland Powered by CapitalBox on Sunday afternoon.
The Estonian was never seriously challenged during the three-day encounter in Lapland’s frozen forests. He built a comfortable lead during the first two legs and eased through the finale to win the FIA World Rally Championship’s second round by 17.5sec.
Home hero Kalle Rovanperä fended off a charging Thierry Neuville to claim the best result of his career in second. At just 20 years old, he became the youngest driver to lead the WRC in the championship’s 49-year history. Neuville finished 2.3sec adrift in third.
Tänak won five of the 10 snow and ice speed tests in his Hyundai i20. Apart from a brush with a snowbank on Saturday, he avoided trouble on superfast roads near Rovaniemi to kick-start his title bid after retiring from the season-opener in Monte-Carlo.
“The pressure was there and we knew it was going to be very complicated to take the fight,” he said. “In the end we did a very good weekend, with only one mistake. It’s an amazing place, definitely one of the best places to have a winter rally.”
Rovanperä, starting just his ninth top-level rally, began the final day with a 1.8sec buffer to Neuville. He extended it by a tenth in the first of two passes through the 22.47km Aittajärvi test, before winning the final Wolf Power Stage to retain his grip on second.
The Toyota Yaris driver moved four points clear of Neuville at the top of the standings, relegating world champion Sébastien Ogier who had a disappointing weekend. The Frenchman finished 20th after burying his Yaris into a snow drift.
Neuville’s third place provided a double podium for Hyundai Motorsport, which reduced Toyota Gazoo Racing’s manufacturers’ championship lead to 11 points.
Craig Breen finished fourth in another i20 after a four-rally absence. Tyre management was crucial and the Irishman fell back on Saturday as he struggled for grip on deteriorating roads after ending the opening day in second. He was 52.6sec adrift of Tänak.
Breen kept Elfyn Evans at bay in the final test after the Welshman closed to within 3.6sec in the penultimate stage. The final gap between them was 8.9sec. Japan’s Takamoto Katsuta rounded off the top six in another Yaris.
Tributes were made on the podium to Finnish rally great Hannu Mikkola. The 1983 world champion and three-time runner-up died on Friday and the Finnish Air Force led the accolades with an F18 Hornet flypast.
The WRC moves to the asphalt Croatia Rally for round three, which is based in Zagreb on April 22-25.
1. O Tänak / M Järveoja EST Hyundai i20 2hr 03min 49.6sec
2. K Rovanperä / J Halttunen FIN Toyota Yaris +17.5sec
3. T Neuville / M Wydaeghe BEL Hyundai i20 +19.8sec
4. C Breen / P Nagle IRL Hyundai i20 +52.6sec
5. E Evans / S Martin GBR Toyota Yaris +1min 01.5sec
6. T Katsuta / D Barritt JAP Toyota Yaris +1min 37.8sec
FIA World Rally Championship (after round 2 of 12)
1. K Rovanperä 39pts
2. T Neuville 35
3. S Ogier 31
4. E Evans 31
5. O Tänak 27
Euro zone factories buzzing in February as demand soars
By Jonathan Cable
LONDON (Reuters) – Euro zone factory activity raced along in February thanks to soaring demand, a survey showed on Monday, although the burst of business led to a shortage of raw materials and a spike in input costs.
Restrictions imposed across the continent to try to quell the spread of the coronavirus have shuttered vast swathes of the bloc’s dominant services industry, meaning it has fallen to manufacturers to support the economy.
IHS Markit’s final Manufacturing Purchasing Managers’ Index (PMI) jumped to a three-year high of 57.9 in February from January’s 54.8, ahead of the initial 57.7 “flash” estimate and one of the highest readings in the survey’s 20-year history.
An index measuring output, which feeds into a composite PMI due on Wednesday that is seen as a good guide to economic health, climbed to 57.6 from 54.6, well above the 50 mark separating growth from contraction.
“Manufacturing is appearing as an increasingly bright spot in the euro zone’s economy so far this year,” said Chris Williamson, chief business economist at IHS Markit.
“The solid manufacturing expansion is clearly helping to offset ongoing virus-related weakness in many consumer-facing sectors, alleviating the impact of recent lockdown measures in many countries and helping to limit the overall pace of economic contraction.”
A Reuters poll last month showed the bloc was in a double dip recession and that the economy would contract 0.8% this quarter after shrinking 6.9% in 2020 on an annual basis. [ECILT/EU]
Rocketing demand for manufactured goods pushed factories to increase staffing levels for the first time in nearly two years.
But lockdown measures disrupted supply chains and factories struggled to obtain raw materials, leading to a big increase in delivery times.
“The growth spurt has brought its own problems, however, with demand for inputs not yet being met by supply. Shipping delays and shortages of materials are being widely reported, and led to near-record supply chain delays,” Williamson said.
Those shortages allowed suppliers to hike their prices at the fastest rate in almost a decade. The input prices PMI bounced to 73.9 from 68.3.
(Reporting by Jonathan Cable; Editing by Hugh Lawson)
Strong exports lift German factory activity to three-year high in February – PMI
BERLIN (Reuters) – Higher demand from China, the United States and Europe drove growth in German factory activity to its highest level in more than three years in February, brightening the outlook for Europe’s largest economy, a survey showed on Monday.
IHS Markit’s Final Purchasing Managers’ Index (PMI) for manufacturing, which accounts for about a fifth of the economy, jumped to 60.7 from 57.1 in January.
It was the highest reading since January 2018 and came in slightly better than the initial “flash” figure of 60.6.
Factories have been humming along during the pandemic on higher foreign demand, helping the German economy avoid a contraction in the last quarter of 2020 and offsetting a drop in consumer spending amid a partial lockdown to contain COVID-19.
Many manufacturers reported higher demand from Asia, especially China, as well as the United States and European countries, with export sales posting their biggest increase since December 2017, the survey showed.
Phil Smith, Principal Economist at IHS Markit, said supply chain pressures intensified as more firms reported delays than ever before in nearly 25 years of data collection.
“There looks to be further upward pressure on inflation in the German economy from supply bottlenecks and a subsequent surge in manufacturing input costs,” Smith noted.
The survey suggested that supply disruption is making it more difficult to replenish stocks, which could complicate production in the coming months, he cautioned.
“Nevertheless, the overriding sentiment for the longer-term outlook is optimism, with a record number of manufacturers expecting to see output rise over the next 12 months.”
Still, economists expect the economy to shrink in the first quarter of this year due to a stricter lockdown, which has shut most shops and services since mid-December, and freezing temperatures that slowed construction activity in February.
(Reporting by Michael Nienaber; Editing by Hugh Lawson)
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