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their long-standing investmentsin plants and equipment, thesecompanies will clearly havelower adoption rates for digitaltechnologies. But all thoseassets also make these sectorsvery intensive in their demandfor financial capital. As a result,digitization is likely to be usedprimarily to maximize return onthat capital. On the other hand,some areas of manufacturingare particularly informationintensive,especially upstream.In the oil and gas business, forinstance, exploration analysisuses massive computing andsmart sensor capabilities todetermine the right investment(and “digging”) choices. Andin the case of large-scaleconstruction, global teamsof architects, scientists, andengineers already work togethervirtually in the cloud to ensurethe seamless completion of theirdesign activities. “Every singleone of our teams is working inthe cloud,” says an executiveat a global software vendoractive in the field of largescaleinfrastructure design.“Manufacturing issues cannow be solved in a matter ofweeks, as opposed to monthsin a traditional model.” TheChinese government, forexample, is currently leadingthe construction of a nationalhigh-speed rail network—ineffect, the world’s largestdigitization project—which willhave digitally connected tracks,axles, in-carriage entertainment,on-screen advertising, ticketing,and infrastructure managementsystems.As these examplesdemonstrate, no industry willremain free of the effectsof digitization. Even thoseindustries that at first glanceseem less “digitizable,” such asmanufacturing and utilities, willgenerate significant digitizationbenefits due to their sheersize. Thus, companies in theseindustries, too, will be forcedto build new capabilities,and many will simply not beprepared with the leadership,culture, organization, and talentnecessary to respond. Regulatorsin many Western economiesare forcing the utilities sector,for example, to deploy smartmeters in hopes of improvingthe efficiency of power grids,which will also draw themcloser to customers, enablingthem to monitor demand andbill in real time. Yet manyutility players will struggleto embrace this shift. Andpharmaceutical companies willdiscover the power of gettingcloser to their end customers,especially in Europe, wherethey are currently barred fromadvertising or direct selling.Digitization also promises toenable them to build virtualcustomer labs, generating moreinformation about their productsand superior customer insight.Here, too, few companies arefully prepared to face the digitalfuture.The range of possibilitiesis seemingly endless, but the keyto success will be to understandhow digitization will affecteach industry first and with thegreatest impact. Only by doingso can companies accuratelydetermine which capabilitiesto build and prioritize whichdigitization investments tomake, and when. Absentan assessment of this sort,companies are likely to be facedwith making more investmentsthan they can afford, andmaking them in the wrong order.The Speed Of DigitizationDigitization has indeed reacheda point of inflection around theworld, but that does not meanthat the phenomenon will occurat the same rate everywhere,or that external events won’tspeed it up or slow it downin different industries andgeographies. To quote novelistWilliam Gibson, “The future isalready here—it’s just not evenlydistributed.” Top executivesmust decide what stance totake on the digitization of theirsector and whether to be a forcedriving the transition to a fullydigitized industry. For those whodecide to forge ahead, the keyquestion is where to focus theirattention. The answer rests on aconsideration of the acceleratorsand decelerators that contributeto the rate of change in theirindustry and geography. Definingboth the engines of digitizationand the potential stumblingblocks is essential to this task.We find it helpful to divide theforces affecting the speed ofdigitization into four key factors:society and culture, economicsand risks, regulation and legalconsiderations, and technology.Based on interviews withEuropean and U.S. players in theinformation and communicationsindustries, we have assessedthe potential accelerators anddecelerators in each of thesefour categories. We expectthis assessment to be globallyrelevant, although the relativeweight of each factor will varyby regional market (see Exhibit7).Society and CultureThe pushto digitization is being drivenmost powerfully by the newgeneration of end-users—bothconsumers and business users—demanding its benefits, includingever-widening social networks,ubiquitous connectivity, andconstant access to news,entertainment, and information.Already we can see the powerof digitization in the role ithas played in the upheavalsin the Arab world. And theentrepreneurial spirit is alive andwell, and contributing greatly52 www.teletimesinternational.comDecember 2011