1、draft COVID-19 outlook for the US technology industry May 2020 Technology, Media cybercriminals are spreading malware.14 Hackers are also exploiting vulnerabilities in cloud-based services and computer hardware, and employees working from home are not the only targets. Cyberattacks on health care fa

2、cilities, laboratories, Many consumers remain concerned about the privacy and security of their personal data; they want tech companies to give them more transparency and control over how their data is used.19 And tech companies can seize this momentwhen the societal benefits of sharing data are evi

3、dentto reassure consumers by prioritizing privacy and trust. Something similar is happening with AI: The benefits are clear, but many people are concerned about unintended consequences and the potential for job losses. Now is the time to manage AIs risks head-on and to set guidelines for the technol

4、ogys ethical use. 6 Create transparency across supply chains In recent weeks, some tech companies have found themselves unexpectedly unable to sell products due to missing components.20 And a lack of visibility throughout their supply chains has complicated the issue. Primary, or tier one, suppliers

5、 often manage webs of their own suppliers, and companies may have no relationship with these second- and third-tier suppliersor know which components they provide, their inventories, or production constraints.21 When disruptions happen, companies may lack the data to determine where failures are occ

6、urring and to make swift course corrections.22 Actions to take: Tech companies should consider digitizing their supply chains to gain visibility throughout their supplier networks. They can start by developing business continuity plans for supply chains and using supply chain mapping to identify sup

7、pliers of critical components, from tier one down to raw materials providers. They can coordinate with suppliers to build digital supply networks that visualize the flow of components, receive alerts when suppliers stocks are low, and automatically switch to alternatives before missed shipments occu

8、r.23 And they can test new technologies such as AI and blockchain. Some supply chain visualization applications use AI to analyze supply chain performance, predict problems, and suggest alternatives. Blockchain offers tech companies a real-time view of their supply chain partners24 and the ability t

9、o execute financial settlements. In the longer term, tech companies should consider buildingor reopeningproduction facilities in North America to build redundancy into the supply chain. Tech companies talked about diversifying production after the Japanese earthquake in 2011 and trade disputes in 20

10、19,25 including reshoring manufacturing capacity. In the wake of the pandemic, that talk may turn to action. Advances in robotics, driven by AI and the intelligent edge (see below), are making manufacturing in high-cost countries more affordable. The road to a strategic recovery Questions to ask: Wh

11、en we consider our compliance and risk management spending, how much do we invest in mitigating supply chain risk versus compliance risk? Where are the greatest risks to our companys financial health? Do we have real-time data throughout our supply chain, or do we rely on “human intelligence” and re

12、lationships for mission-critical data? Do we have ready alternatives for the bill of materials of our most important products? Are there new technologies and approaches we could use to improve our ability to anticipate problems and switch suppliers before a shortage occurs? How can we ensure that th

13、e components we use in our products dont have design flaws that hackers can exploit? What happens if we need “surge capacity”? Which suppliers can meet the demand? For all its pain, the COVID-19 crisis can be an opportunity to make significant upgrades to infrastructure and processes that may be lon

14、g overdue. Developing more transparent and dynamic supply chains, enabling higher-performing remote workforces, and accelerating migration to public clouds are potential ways to recover strongly while setting up long-term strategies for success. COVID-19 outlook for the US technology industry | Tech

15、 hits a glitch | The road to a strategic recovery | Thriving in the coming era | Emerging stronger 7 Enable high-performing remote workers Mandatory shutdowns make it hard to develop products with in-person teams. Its unclear how long current shutdowns will last or whether there will be multiple wav

16、es of them over the next year. Tech companies should consider developing new products, services, and softwareand performing essential updates and upgradeseven when engineering and design teams have no choice but to work remotely. They should also help ensure that product development moves ahead if k

17、ey personnel are unavailable. Enabling more regular remote capabilities after the crisis can ultimately lower costs and ensure greater resilience without sacrificing performance. Actions to take: Tech companies should consider digitizing their design processes, from knowledge-sharing through the sim

18、ulation of physical products. The benefits can include bolstered resilience and the ability to launch new services. The main steps can address three key areas: 1. Knowledge management. Build a knowledge exchange to prevent “single points of failure” if key personnel are unavailable. Identify top ski

19、lls and experts and ensure that their knowledge is available to others on the design team. 2. Digital design. Design data should be captured and managed through “digital threads” that enable virtual collaboration and maintain version control. Digital threads can be especially important in maintainin

20、g DevOps for software development in a remote work setting. 3. Digital testing. Build digital twins of physical products that simulate all components and systems. This can allow companies to do much of their product testing virtually. Digital twins can also enable predictive analytics services and m

21、aintenance for complex products.26 With digital product development in place, tech companies can be better able to develop products virtually, protecting them from risk and helping them to recruit design talent from around the world instead of being limited to specific locations. Questions to ask: H

22、ow prepared are we if key product design engineers were to become unavailable? Would important projects stall? Could our design projects continue if shutdowns lasted longer than a few weeks? How do we manage version control with remote teams? Can we simulate product design and testing to minimize th

23、e need for physical prototypes? Product development data is valuable intellectual property and can be the target of industrial espionage attacks. How can we ensure that our “digital threads” are secure? COVID-19 outlook for the US technology industry | Tech hits a glitch | The road to a strategic re

24、covery | Thriving in the coming era | Emerging stronger 8 Actions to take: Companies should consider migrating more of their applications and workloads to public cloud services. Cloud migration often requires careful strategy and planning,29 and some applications may be unsuitable for public clouds.

25、 But for those that make sense, public clouds can help tech companies reach two critical goals during the COVID-19 crisis. The first is to cut costs, though for this strategy to pay off, companies should decommission data centers to avoid paying both to operate multiple data centers and for cloud-ba

26、sed workloads. The second goal is to make IT more agile by adapting dynamically to spikes in demand while paying only for what companies use. Another benefit of cloud migration can be the ability to develop cloud-native apps that are more efficient, modular, and adaptable. Accelerate migration to th

27、e public cloud The COVID-19 pandemic has helped show the value of the public cloud. Many companies that use the public cloud, such as videoconferencing services, have been able to scale as demand spiked. In contrast, some companies that rely on their own IT infrastructure have had trouble scaling th

28、eir operations during the crisis, resulting in service degradation and lost revenue.27 Some have also struggled to fix infrastructure and install new hardware because they couldnt get IT staff onsite.28 Questions to ask: Which applications can we shift quickly to public clouds? Are there cloud-based

29、 services or applications we can use right away to reduce costs? What steps can we take to migrate legacy applications from our data center to the cloud? How can we ensure that our data in the public cloud is secure? How can we ensure that we work closely with cloud providers to have best-in-class c

30、ybersecurity policies? COVID-19 outlook for the US technology industry | Tech hits a glitch | The road to a strategic recovery | Thriving in the coming era | Emerging stronger 9 Manage costs and responsiveness with everything-as-a-service Increasingly, many companies across industries prefer to pay

31、for technology based on usage instead of the traditional IT model involving an up-front purchase or licensing. That will likely accelerate as they seek to preserve cash during and after the COVID-19 crisis. Most importantly, leaders see everything-as-a-service (XaaS) as a critical way to increase bu

32、siness agility30 and to access innovative technologies such as artificial intelligence.31 Actions to take: Tech companies that sell hardware and services should consider accelerating their transition to XaaS offerings. This process involves a series of steps that enable companies to market, sell, de

33、liver, support, and scale XaaS solutions.32 Tech companies should also establish customer success organizations to improve renewal rates and new service adoption. By ensuring that XaaS customers get maximum value from their subscriptions and are offered complementary services based on their usage an

34、d needs, tech companies can develop strong recurring revenue streams.33 Finally, tech companies should develop channel partners that can help them build upon XaaS services with vertical and regional- specific offerings. Thriving in the coming era Questions to ask: What are the most important product

35、 lines to move to XaaS? What steps are needed to adapt our sales operations and incentives to XaaS? Which channel partners can make the transformation to XaaS with us? Who is positioned to add value on top of a service-based offering? Can we expand our XaaS portfolio through acquisitions and partner

36、ships? As we move into XaaS, how do we build cybersecurity into our new services? The COVID-19 crisis is forcing many businesses into a defensive posture amid unprecedented change and uncertainty. Yet the world will likely inevitably return to a new equilibrium, as it has after every past crisis. Do

37、ne smartly, recovery can take advantage of sudden opportunities to make bold changes that shift tech businesses into a position of thriving in the coming era. COVID-19 outlook for the US technology industry | Tech hits a glitch | The road to a strategic recovery | Thriving in the coming era | Emergi

38、ng stronger 10 Actions to take: Develop intelligent edge product and service portfolios. The intelligent edge is the combination of processing power, data analysis, and advanced wireless connectivity that takes place nearor onnetwork endpoints. These endpoints are devices that generate and consume d

39、ata: smartphones, robots and drones, and sensors. Importantly, the intelligent edge isnt a single thingits a complementary piece of a holistic enterprise, from cloud to servers to sensors, devices, and users. Some tech companies are developing important components of the intelligent edge now, includ

40、ing compact, modular, and ruggedized converged systems; Wi-Fi 6 networking gear; and inexpensive, low-power edge AI chips.34 Tech businesses can partner with telecom companies and enterprises to develop industry-specific solutions around proven use cases. Many intelligent edge technologies are helpi

41、ng to automate warehouses, ports, retail stores, and factory floors, often with new technologies such as AI-enabled robots. Codeveloping solutions with these companies can help accelerate the adoption of managed intelligent edge services. It can also slow commoditization: Edge services can be built

42、with software using white-box hardware. Expand automation with edge intelligence Companies across industries are looking to cut costs and develop value-added services by automating and digitizing their operations. Even as they look to cut costs, companies will likely invest in technologies that adva

43、nce these strategic goals. Intelligent edge technologies can be essential for building automated, efficient manufacturing facilitieswhich many industries may be looking to reshore to make their own supply chains more resilient. Critically, the intelligent edge can enable rapid evaluation of data rig

44、ht where it is collected. Questions to ask: Which intelligent edge use cases show the most promise in terms of effectiveness, adoption, and market size? How would these align with and affect existing enterprise services? How can we develop an integrated solution instead of providing hardware compone

45、nts? How can we connect that solution to customers data centers and cloud environments? Which partnerships might help us enter promising industries and markets? Edge devices can increase the “attack surface” of the enterprise. How can we secure these devices and our data centers at the edge? COVID-1

46、9 outlook for the US technology industry | Tech hits a glitch | The road to a strategic recovery | Thriving in the coming era | Emerging stronger 11 Actions to take: As the immediate crisis fadesbut before the recovery begins in earnesttech companies with ready cash should consider strategic acquisi

47、tions to enter new markets and make tech and talent deals to bolster their capabilities. Seize the M prioritization rules in place due to COVID-19,” ZDNet, March 29, 2020. 3. Punit Renjen et al., Recovering from COVID-19: Economic cases for resilient leaders, Deloitte Insights, March 16, 2020. 4. Re

48、al gross US GDP. See Robert Rich, “The Great Recession,” US Federal Reserve, November 22, 2013. 5. Jeff Cox, “Weekly jobless claims hit 5.245 million, raising monthly loss to 22 million due to coronavirus,” CNBC, April 16, 2020. 6. Harriet Torry and Sarah Nassauer, “Coronavirus closures froze swaths

49、 of U.S. economy in March,” Wall Street Journal, April 15, 2020. 7. IDC, “IDC expects worldwide IT spending to decline by 2.7% in 2020 as COVID-19 drives down forecasts,” April 2, 2019. 8. Kevin Westcott et al., Connectivity and mobile trends: Build it and they will embrace it,” Deloitte Insights, November 2019. 9. IDC, “IDC expects worldwide IT spending to decline by 2.7% in 2020 as COVID-19 drives down forecasts.” 10. Tom Loftus and Agam Shah, “Employers face shortages of tech gear as coronavirus forces shipment delays,” W