Priorities for Adopting an Exponential IT Mindset in the Wholesale Industry
Adopting Exponential IT is critical for business growth and sustainability.
- Top performing companies are action-oriented and unafraid of change. With an expected 6.8% increase in IT spending for 2024 over 2023, it is imperative that companies are moving off outdated systems to not being left behind.
- The industry is facing pressure on profit margins with increased competition, enduring inflation, and continued high interest rates into 2024, and higher pricing through the pandemic has increased competitive pressure as higher supply costs come off.
- Customers are looking for products and services that serve their needs, which puts more pressure on wholesalers to listen, better understand their customers, and adjust their offerings.
Our Advice
Critical Insight
Wholesalers are facing challenges in maintaining their competitiveness due to heightened competition, the use of legacy equipment, and traditionally large amounts of technical debt. The enablement of innovation is crucial for improving the business’ competitive positioning, where IT leaders need to be recognized as valued business partners to empower the organization to embrace exponential technologies.
Impact and Result
- Recognize the urgency of adopting Exponential IT within the wholesale industry to combat and/or exploit industry disruptions.
- Comprehend the three priorities of Exponential IT transformation in the wholesale industry that are being adopted today to remain competitive within the market.
- Acknowledge the foundational capabilities and maturity required to begin an effective Exponential IT transformation, resulting in value creation.
Priorities for Adopting an Exponential IT Mindset in the Wholesale Industry
Adopting Exponential IT is critical for business growth and sustainability
Analyst Perspective
Enable value creation through Exponential IT
As technology continues to see game-changing innovation, organizations are faced with the real possibility of being left behind their competition. It is imperative that organizations are prepared for the next wave of rapid, exponential evolution of technology. Organizations that are positioned to pivot, adapt, and adopt new technologies have the greatest potential to unlock value for their organizations.
Adopting an Exponential IT mindset is about being prepared for this growth through evaluating existing operations and organizational structures and taking steps to modernize them. Info-Tech has identified foundational capabilities and essential steps to take in the process of adopting an Exponential IT mindset to help organizations prepare.
Donnafay MacDonald
Research Director, Retail and Wholesale Industry
Info-Tech Research Group
Executive Summary
| Your Challenge | Common Obstacles | Info-Tech's Approach |
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Increasing competition from within the wholesale industry and the emergence of new technologies are pushing businesses to prioritize transformations to compete more effectively. IT leaders struggle to identify which skills are needed and where to get specialized knowledge to keep up with the exponential shifts taking place across the industry. The ability to advance human-machine processes and capabilities will be restrained by the lack of knowledge and skill resources. |
Customers are demanding personalized services and transparency, which is difficult for wholesale organizations due to complex and costly legacy infrastructures. Real-time data-driven capabilities are becoming increasingly critical to provide dynamic adaptability during market shifts and competitive pressures. There is a need to develop sustainable and environmentally friendly business processes and policies for the new world. |
Recognize the urgency of adopting Exponential IT within the wholesale industry to combat and/or exploit industry disruptions. Comprehend the three priorities of Exponential IT transformations in the wholesale industry that are being adopted today to remain competitive within the market. Acknowledge the foundational capabilities and maturity required to begin an effective Exponential IT transformation, resulting in value creation. |
Info-Tech Insight
Wholesalers are facing challenges in maintaining their competitiveness due to heightened competition, the use of legacy equipment, and traditionally large amounts or technical debt. The enablement of innovation is crucial for improving the business' competitive positioning, where IT leaders need to be recognized as valued business partners to empower the organization to embrace exponential technologies.
What Is Exponential IT?
Exponential IT is a framework defined by Info-Tech Research Group.
The technology curve has recently bent exponentially.
Generative AI has been the catalyst for this sudden shift, but there are more and more new technologies emerging (e.g. quantum computing, 5G) putting significant pressure on all organizations.
Speed is now imperative. All IT leaders and organizations are at risk of falling behind if they do not adopt new technologies fast enough.
Our framework instructs all IT leaders on how to transform their organization and elevate their value-creation capabilities to close the gap between the exponential progression of technological change and the linear progression of IT's ability to successfully manage that change.
This research provides IT leaders with industry-specific priorities for Exponential IT and how to begin an effective Exponential IT transformation, resulting in value creation.
Your Exponential IT Journey
To keep pace with the exponential technology curve, adopt an Exponential IT mindset and practices. Assess your organization's readiness and embark on a transformation journey. This report will provide greater insights to help you build your Exponential IT roadmap.
Adopt an Exponential IT Mindset
Info-Tech resources: Exponential IT Research Center, Research Center Overview, and Keynote.
Explore the Art of the Possible
Info-Tech resources: Exponential IT research blueprints for nine IT domains.
Gauge Your Organizational Readiness Repeat annually
Info-Tech resource: Exponential IT Readiness Diagnostic (coming soon).
Build an Exponential IT Roadmap Repeat annually
Info-Tech resource: Develop an Exponential IT Roadmap blueprint.
Embark on Your Exponential IT Journey
Info-Tech resources: Ongoing and tactical domain-level research and insights.
To access all Exponential IT research, visit the Exponential IT Research Center
Go to this link
The pace of technological change will continue to increase exponentially in wholesale
IT must solve the problem of rapidly and exponentially increasing expectations.
Organizations are adopting exponential technologies at an accelerated rate due to the rapidly changing landscape. Traditional linear IT is no longer viable to sustain IT's place as the leading technology provider for its organization.
Failure to launch will leave you far behind. The chasm between the organization's desire to harness technology and IT's ability to deliver it will continue to widen.
The challenges with traditional linear IT:
- Slow to adapt to more modern service delivery models.
- Processes and decision-making that can't accelerate to meet demand.
- Transactional arms-length relationships with organization units and vendors.
- Insufficient funding and focus on technology innovation.
- Locked into a siloed and hierarchical operating model.
The Case for Exponential IT
IT needs to fundamentally transform the way it is operating in the following ways:
- Build an Adaptive Delivery Model: Enable flexible and efficient delivery of products and services.
- Optimize & Autonomize Operations: Maximize efficiency while mitigating risks through intelligent automation and data-driven decision-making.
- Broker Strategic Relationships: Strengthen and build both external and internal relationships to better align IT capabilities to organizational goals.
- Embrace Digital Innovation: Evaluate and adopt solutions that drive consumer value, enterprise growth, and innovation.
- Cultivate Workforce Flexibility: Dismantle traditional jobs and hierarchies, normalize new collaborative ways of working, and adopt a federated and hybrid IT operating model.
The wholesale industry has significant challenges in adopting Exponential IT
Adopting Technology
- Top performing companies are action-oriented and unafraid of change. With an expected 6.8% increase in IT spending for 2024 over 2023, it is imperative that companies are moving off outdated systems to not be left behind.
- Wholesalers must continue to invest in technology and innovation. While companies are seeking to gain a deep understanding of Exponential IT, to stay competitive they must continue to invest.
Customer Expectations
- The industry is facing pressure on profit margins through increased competition, enduring inflation and continued high interest rates into 2024.
- Companies are responding with stronger management of sales channels, curating experiences, leveraging their supply chain and most importantly optimizing pricing by utilizing machine learning and artificial intelligence to analyze and provide insights from their data sources.
Increased Pressure on Profit Margins
- Customers are looking for products and services that serve their needs, which puts more pressure on wholesalers to listen, better understand their customers, and adjust their offerings.
- Companies are better able to meet demand post COVID-19 through better inventory controls and more efficient supply chains, but customers are expecting fast and convenient delivery.
Source: Boston Consulting Group, 2022
93% of survey respondents agreed that data strategy is critical for getting value from gen AI.
Source: HBR, 2024
72% of executives agree data problems will be the most likely element to jeopardize AI/ML goals.
Source: MIT Technology Review Insights Survey, 2022
Imperatives for Exponential IT adoption in wholesale and how to navigate disruption
Market Disruptions and Obstacles
1 Demand-Driven Supply Chain Networks
- The demand-driven supply chain networks offer immense flexibility and real-time decision-making capabilities that have not been seen before.
- Companies must be cognizant of their existing capabilities to successfully implement and capitalize on demand-driven supply chain networks across the existing supply chain to incrementally implement solutions that best interface with internal and external stakeholders' ability to scale-up.
2 Digital Transformation
- Companies must transform their existing technology architecture and operating model while being faced with changing technology to fully connect and automate.
- Harness existing data to adopt and implement digital modernization to unleash its power through faster and better decision-making.
3 Dynamic Pricing Strategies
- Improve pricing strategies by implementing dynamic pricing that uses expanded data points to inform on product performance across all channels and market conditions.
- Companies that adopt dynamic pricing strategies can better differentiate from competitors and maximize company revenues.
4 Physical and Digital Experiential Commerce
- Starting in mid-2021, "experience first" has increased in importance above "health first" and "society first" as the reason to purchase a given brand's products.
- Traditional loyalty programs are no longer providing strong growth in returns. Companies that are engaging with their customers across multiple touchpoints are seeing one-and-a-half to two times more value across all loyalty program tiers.
Info-Tech Insight
We are experiencing exponential change as the market is shifting to focus on autonomous automation, intelligent processing, sustainability, and human-centric business processes. Adopting new technology that aligns across the organization and leveraging AI and ML will set companies up to stay competitive and profitable.
Business opportunities are developed from industry disruptions
| Challenges | Market Responses | Business Opportunities | |
| Adopting Technology | 01 Demand-Driven Supply Chain Networks | Enhanced Supply Chain | Improve supply chain agility through end-to-end visibility using IoT's, AI, AVRs, shelf-edge technology and other advanced automation tools and generate advantageous big data. |
| Increased Pressure on Profit Margins | 02 Digital Transformation | Adopt Cloud | Adopt cloud computing for applications, allowing for digital transformations using AI. |
| 03 Dynamic Pricing Strategies | Optimized Pricing | Capitalize on an enhanced supply chain and improved data to drive out price optimization for a leading competitive edge. | |
| Customer Expectations | 04 Physical and Digital Experiential Commerce | Experiential Customer Journey | Using big data to listen and respond to customers allows you to create curated experiences that cross real life and digital platforms. |
If IT leaders cannot lead this upcoming transformation, then the organization will move forward without them
Only 2% of CXOs report that their IT department can transform the organization. Most IT departments (77%) still struggle to adequately support the organization.
33% of CXOs believe that their IT department must reach the highest level of Info-Tech's IT maturity to best serve the organization in the future. 42% of CIOs agree.1
1 Info-Tech CXO-CIO diagnostic benchmark data, 2023, n=229 CXO's
Source: Info-Tech CXO-CIO diagnostic benchmark data, 2023, n=229
Info-Tech Insight
As organizations strive to succeed in the next phase of technology-driven transformation, CIOs have an opportunity to demonstrate their organizational leadership. To do so, they will have to start delivering organizational capabilities instead of services while owning organizational targets.
Determine IT's innovation maturity to assess Exponential IT readiness
Complete the CIO Business Vision Diagnostic to understand business needs and satisfaction with IT
Organizations must score above 70 to be properly supported by the business and prepared for an Exponential IT shift.
| Total Score | Innovation Maturity | PREPARED | Next Steps |
| 90%+ | INNOVATOR Leads exponential innovation & transforms the business |
Continue the Exponential IT journey | |
| 80-90% | BUSINESS PARTNER Partners with the business to drive change |
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| 70-80% | TRUSTED OPERATOR Rapidly executes on enterprise innovation |
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| 60-70% | FIREFIGHTER Takes orders from the business |
UNPREPARED | Do not continue the Exponential IT journey
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| <60% | UNSTABLE Unable to support enterprise innovation |
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Evaluate IT's capability effectiveness and importance in executing Exponential IT
Complete the Management & Governance Diagnostic to assess core IT processes for improvement
To properly execute Exponential IT, the organization must understand IT's strengths and weaknesses for effectively managing and improving the department for innovation.
Collect the data the organization needs to start the process improvement journey and enable Exponential IT. The organization will get a customized report highlighting its most pressing IT process needs based on the following color coding.
Any processes that require improvement or evaluation should be prioritized for advancement before starting the Exponential IT journey. These core processes are required to effectively execute standard IT processes before innovating to Exponential IT processes.
Leverage Info-Tech's Exponential IT diagnostic to gauge readiness
Complete the Exponential IT diagnostic to determine organizational and IT readiness for exponential technologies
Info-Tech's Exponential IT Readiness Diagnostic is designed to assess the readiness of your organization to embrace and extract value from exponential technologies. It measures executive stakeholder perceptions of organizational readiness for transformation and IT leader perceptions of IT readiness for transformation.
This readiness assessment is a crucial initial step in the Exponential IT journey to help you understand the needs, opportunities, and priorities of stakeholders across the organization.
Organizational readiness
Organizational readiness refers to perceived readiness to adopt exponential technologies and willingness to change into a more adaptable, forward-looking organization.
Without strong organizational readiness for transformation, IT will need to take extra steps to drive technology adoption, break down silos, and gain support for its own transformation efforts.
IT readiness
IT readiness includes current maturity across all IT domains, willingness and support for transformation, and foundational elements required for Exponential IT.
Without a high IT readiness for Exponential IT, the transformation roadmap may need to include additional foundational change efforts in its first year.
About Info-Tech
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We produce unbiased and highly relevant research to help CIOs and IT leaders make strategic, timely, and well-informed decisions. We partner closely with IT teams to provide everything they need, from actionable tools to analyst guidance, ensuring they deliver measurable results for their organizations.
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