Unleashing the Power of a Digital Core: Igniting Innovation and Reinvention

In today's rapidly changing business landscape, leaders understand the importance of reinvention. In fact, 83% of business leaders are accelerating their efforts to adapt and thrive in the face of change. At the heart of this reinvention lies the concept of a digital core.

But what exactly is a digital core? In our latest research report, "Reinventing with a digital core ", we delve into the significance of building a connected technology capability that serves as the foundation for continual change and competitive advantage. This article aims to demystify the concept of a digital core and explore its role in driving revenue growth and profitability.

At Accenture, we define a digital core as a critical technology capability that empowers organizations to embrace change, reinvent their operations, and leverage groundbreaking technologies. Just like the core of a car, which consists of various components working together to ensure optimal performance, a digital core brings together key building blocks with strong digital threads. It enables companies to think differently, work with emerging technologies like generative AI, and stay ahead of the competition.

A robust digital core comprises seven essential components:

1. Digital platforms: Combining applications into platforms that generate new sources of value.
2. Data: Accessible and usable information about the business and its customers.
3. Cloud: Flexible infrastructure encompassing public cloud, private cloud, and edge computing.
4. Composable integration: Seamless connectivity between all parts of the digital core.
5. AI: Artificial intelligence used to enhance productivity and create innovative content.
6. Security: Embedding cybersecurity practices to ensure resilience.
7. Continuum control plane: A command-and-control center providing visibility into the entire tech stack.

However, building an industry-leading digital core is just the beginning. Our research reveals that companies that are truly reinvention-ready follow three fundamental principles, known as the three B's:

1. Build: Create a digital core tailored to the specific industry and company.
2. Boost: Increase innovation spending by at least 6% annually.
3. Balance: Address tech debt while investing in future technologies.

By adhering to these principles, businesses experience a 60% higher revenue growth rate and 40% higher profitability. The journey towards a reinvention-ready digital core requires strategic shifts, including embracing new ways of working, supporting current operations, and prioritizing future innovations such as AI and cloud technologies.

As technology innovators, we have the power to shape the future of our organizations. By embracing the concept of a digital core, we can ignite innovation, drive revenue growth, and reinvent our operations. Now, I invite you to reflect on your own digital core. What components make up your organization's digital core? How can you leverage its power to stay ahead in the ever-changing digital landscape? The journey towards a reinvention-ready digital core begins with you.

Report: Reinventing with a digital core

Helmut Schindlwick is an experienced enterprise architect, enthusiastic consultant, and author who believes in ongoing change. Helmut is devoted to professional excellence and innovation and believes in lifelong learning. This article is for general information purposes only. It is not intended as legal, financial or investment advice and should not be construed or relied on as such. The views and opinions expressed in this article are those of the authors and do not necessarily reflect any organisation's official policy or position.