Canadian companies are going to be spending more than $16 billion this year on digital transformation technologies and services, which is about 20 per cent higher than the year before, according to new research from International Data Corporation (IDC) Canada.

The digital and technology research firm, said in an Aug. 7 press release that spending will particularly come from the manufacturing industries and the business services sector. It noted that based on its own worldwide semiannual digital transformation spending guide, close to 100 digital transformation technologies and services were examined and results provided “new insights” into spending priorities.

“Canadian organizations are clearly moving quickly to adopt [digital transformation] solutions and technologies in order to respond to marketplace challenges from competitors, customers, and employees,” Jim Westcott, research manager at IDC, said in the release.

The projected increase was announced just a few days before parent ITWC hosts the Digital Transformation Awards. Nominated companies include Interac, which is looking to expand its services internationally; the Royal Bank of Canada, which transformed its intranet portal into a customer-facing self-service centre; and the City of Vancouver, which is winning kudos for being the most innovative city in Canada. The conference and awards ceremony will take place tomorrow at The Globe and Mail Centre in downtown Toronto.

IDC added in the release that that “engines of growth” for digital transformation spending include: innovation accelerators, the products and services associated is IoT, cognitive/AI systems, Next Gen security, 3D printing, AV/VR, and robotics. The release added that innovation accelerators is expected to grow from $6.5-billion in 2016 to $24-billion by 2021.

“Manufacturing companies are now harnessing technology to achieve cost, speed, and quality efficiencies in their process at scale. Over the next few years, the companies that cannot adapt to this new paradigm will find it hard to compete in the marketplace,” Yash Ahuja, senior analyst of measurement and forecasting at IDC, said in the release.

Strategic priorities for digital transformation growth is also expected to grow especially in smart manufacturing, digital supply chain optimization, and omni-experience engagement. IDC projected that smart manufacturing spending will increase to $1.5-billion this year.

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