New York, April 27, 2023 (GLOBE NEWSWIRE) -- The global digital workplace market was worth USD 33 billion in 2022, and it is projected to attain USD 234 billion by 2032. During the period between 2023 and 2032, the market is expected to record a compound annual growth rate (CAGR) of 22.3%. The digital workplace is the modern version of traditional workplaces, offering customized role-based services to employees. Employees have easy access to data and services from anywhere at any time to meet their needs. A digital workplace takes advantage of the latest services and technology to accommodate how people work, increasing employee engagement and satisfaction levels.
It provides a personalized environment that enables workers to work more efficiently from home or other remote locations. Instead of being limited by technology, people become motivated by it, enabling them to reach their highest potential. Digital workplace services enable businesses to reduce operating expenses, as they no longer need to pay rent for office spaces or electricity bills. Furthermore, the combination of mobile devices and cloud-based applications has transformed our work environments into cooperative open spaces with non-routine schedules as the new norms.
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Key Takeaway:
- By the component analysis, the Services segment dominates the market with a 65% market share.
- By Enterprise size analysis, the large enterprise segment dominates the market with a 63% market share.
- By the End-User analysis, IT and Telecom dominate the market with a 24% market share.
- In 2022, North America dominated the market with the highest revenue share of 35%.
- APAC is expected to grow at a greater pace owing to affordable prices, increasing medical tourism, as well as hospitals and clinics, among other factors.
Factors Affecting the Growth of the Digital Workplace Industry
- Advancements in Technology: The development of advanced technologies like cloud computing, artificial intelligence, and the Internet of Things (IoT) is expected to propel growth within the digital workplace industry. These advancements allow companies to design more sophisticated digital workspaces that can support various activities.
- Increased Demand for Remote Work: The COVID-19 pandemic has caused an unprecedented surge in remote work demand, which is expected to persist even after the crisis ends. This trend will drive the adoption of digital workplace solutions designed to facilitate this kind of work and collaboration.
- Changing workforce demographics: As younger generations enter the workplace, they become increasingly comfortable with technology and expect access to digital tools and resources in the workplace. This trend is expected to spur the adoption of digital workplace solutions tailored toward these workers' needs and preferences.
- Globalization: Businesses operating across multiple locations and time zones will find that digital workplaces provide a way to break down geographic barriers, improving communication and collaboration. This trend is expected to encourage the adoption of solutions designed specifically for global workforces.
- Cost Savings: Digital workplaces offer companies the potential to save money on office space, travel costs, and other expenses associated with traditional work arrangements. This trend is expected to accelerate the adoption of digital workplace solutions that reduce expenses and enhance efficiency.
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Market Growth
The growth of the digital workplace market can be attributed to several factors, including increasing adoption of remote work, demand for more flexible work arrangements, and technological advances. Furthermore, COVID-19 has further spurred this expansion as many companies have had no choice but to quickly implement digital workplace solutions to facilitate remote working and collaboration.
Regional growth is forecast to be highest in Asia Pacific, due to the increasing adoption of cloud-based digital workplace solutions and an influx of start-ups and small and medium-sized enterprises (SMEs) there. North America will hold the majority share of this market due to several major players present there as well as high adoption rates among enterprises. Overall, the digital workplace market is expected to keep expanding over the coming years as companies strive to implement more flexible and efficient work arrangements and utilize digital technologies for increased productivity and collaboration.
Regional Analysis
Regionally, North America dominates the market with a 35% share. The digital workplace industry has seen incredible growth due to the increasing adoption of cutting-edge technologies like AI, BYOD, and enterprise mobility management solutions. Many regional workplace transformation service providers are rapidly incorporating cloud technologies and Artificial Intelligence into their service offerings. Furthermore, due to the region's bustling manufacturing, retail, and automotive sector, there is an increasing preference for software and robotics solutions. This in turn drives growth in the regional market.
Asia Pacific is forecast to experience a CAGR of 23.6% during the forecast period due to the rapid adoption of digitization across various industry sectors and increasing reliance on cloud platforms among enterprises. Furthermore, market players in this region are employing various strategies such as product development, collaborations, and strategic partnerships in an effort to maintain their dominance within the industry.
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Scope of the Report
| Report Attribute | Details |
| Market Value (2022) | USD 33 billion |
| Market Size (2032) | USD 234 billion |
| CAGR (from 2023 to 2032) | 22.3% |
| North America Revenue Share | 35.0% |
| Historic Period | 2016 to 2022 |
| Base Year | 2022 |
| Forecast Year | 2023 to 2032 |
Market Drivers
As cloud adoption increases, organizations are transitioning from traditional workplaces to digital ones. The cloud offers greater adaptability, scalability, and accessibility which makes it simpler for businesses to implement digital workplaces. The COVID-19 pandemic has seen a marked shift towards remote work, which is expected to persist even after the crisis ends. As such, there has been an uptick in demand for digital workplace solutions that facilitate this type of arrangement and collaboration. Mobile devices are becoming more prevalent in the workplace, with employees increasingly using them to access work-related information and applications. This has necessitated a need for digital workplace solutions that are optimized for mobile use.
Companies are realizing the significance of employee engagement and productivity for driving business success. Digital workplace solutions can facilitate better collaboration, communication, and knowledge sharing among employees - leading to higher levels of engagement and productivity. Emergencies such as artificial intelligence, machine learning, and the Internet of Things (IoT) are enabling more sophisticated digital workplace solutions. These innovations make it simpler to automate repetitive tasks, provide personalized experiences and enhance decision-making processes.
Market Restraints
Adopting a digital workplace solution can be costly, particularly for small and medium-sized businesses (SMBs). This may present as an impediment to adoption for some organizations. While digital workplaces offer numerous advantages, they require a certain level of digital literacy and proficiency to use effectively. Without adequate skillsets or training, some employees may lack the capacity to utilize these solutions effectively, leading to lower adoption rates. As digital workplaces involve storing and sharing sensitive information, data security should be a top priority. Organizations must guarantee their digital workplace solutions have robust security features to guard against cyber threats.
Integrating digital workplace solutions with existing systems and processes can be a formidable obstacle, particularly for organizations that rely on legacy systems. This could negatively affect the usability and efficacy of these solutions. Transitioning from a traditional workplace to a digital one can be intimidating for some employees, leading to resistance. Organizations need to effectively communicate the advantages of digital workspaces to employees and offer adequate training to help them adjust.
Market Opportunities
Digital workplace solutions offer tools for real-time collaboration, communication, and knowledge sharing among employees. Fostering a collaborative work environment can enhance decision-making, speed up problem-solving processes and boost innovation within organizations. As more employees opt for remote working, organizations have an opportunity to take advantage of digital workplace solutions to facilitate and support this trend. By providing employees with the necessary tools for successful remote work, businesses can attract and retain top talent while improving overall productivity levels. Digital workplace solutions can be customized to each employee's requirements, creating a more tailored experience. Organizations that understand employee preferences and work styles will see improvements in engagement levels, productivity levels, and job satisfaction scores.
Recent advances in artificial intelligence and machine learning are enabling routine tasks to be automated, freeing employees to focus on more strategic work. Digital workplace solutions that incorporate automation can help organizations boost efficiency and cut expenses. Digital workplace solutions generate vast amounts of data about employee behavior, productivity, and engagement. By analyzing this information, organizations can gain invaluable insights into their workforce and identify areas for improvement.
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Report Segmentation of the Digital Workplace Market
Component Insight
Based on the component analysis, the Services segment dominates the market with a 65% share. Small to Medium-Sized Enterprises (SMEs) have increasingly turned towards cloud technology to gain modern, cloud-oriented insights that are supported by artificial intelligence, IoT, Cloud computing, and other industrial automation mechanizations. Large organizations also benefit from executive and professionally managed services; ultimately these services increase demand for the digital workplace.
Enterprises size Insight
Analyzing enterprise size, it is clear that large enterprises command the majority of the market with a 63% share. Large enterprises are adopting cloud technology and other cutting-edge tools that are easy to consume, powered by AI and automation technologies and software. Tata Consultancy Services Limited (TCS) Cognix is one such example - it's a digital workspace solution tailored specifically for large organizations with full automation capabilities. The solution offers real-time dashboards with intelligent reporting, equipping users with future technologies such as Augmented Reality (AR), Virtual Reality (VR), and cognitive automation. The implementation of these solutions will further accelerate the adoption of digital workplace solutions within large enterprises.
End User Insight
According to End-User analysis, IT and Telecom dominate the market with a 24% share. The primary factors driving this segment growth include increasing adoption of IoT, AI, SaaS solutions, work-from-home cultures, and bring-your-own-device (BYOD) practices in IT & telecom companies; these have resulted in more digital workstation applications. Infosys, an IT company offering business consulting and outsourcing services, recently implemented four digital workplace platforms for their internal workforce: Launchpad (for the employee onboarding), InfyMe (for employee services and experience platform), LEX (for digital learning) and Meridian (for collaboration and virtual events). These innovations allowed Infosys to quickly adopt remote working models and hybrid work models during the pandemic further driving the adoption of digital workplace solutions within IT & telecom during the forecast period.
Recent Development of the Digital Workplace Market
- On February 20, 2021, Accenture announced the acquisition of Imaginea, a provider of cloud-based platforms. This acquisition will enable Accenture to enhance its offering of cloud-based management for digital solutions and services.
- In 2020, IBM created a revolutionary line setup that utilizes artificial intelligence (AI) to aid HR professionals in perfecting their professional techniques.
- In February 2020, Infosys announced its partnership with GE Appliances. Through this alliance, Infosys will assist GE in further developing its IT framework and function IT in managed services.
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Market Segmentation
Based on Component
- Solutions
- Services
Based on Enterprise Size
- Small and Medium Enterprises
- Large Enterprises
Based on End-User
- Healthcare
- Retail
- IT & Telecom
- BFSI
- Government
- Media & Entertainment
- Other End-Users
By Geography
- North America
-
- The US
- Canada
- Mexico
- Western Europe
-
- Germany
- France
- The UK
- Spain
- Italy
- Portugal
- Ireland
- Austria
- Switzerland
- Benelux
- Nordic
- Rest of Western Europe
- Eastern Europe
-
- Russia
- Poland
- The Czech Republic
- Greece
- Rest of Eastern Europe
- APAC
- China
- Japan
- South Korea
- India
- Australia & New Zealand
- Indonesia
- Malaysia
- Philippines
- Singapore
- Thailand
- Vietnam
- Rest of APAC
- Latin America
-
- Brazil
- Colombia
- Chile
- Argentina
- Costa Rica
- Rest of Latin America
- Middle East & Africa
-
- Algeria
- Egypt
- Israel
- Kuwait
- Nigeria
- Saudi Arabia
- South Africa
- Turkey
- United Arab Emirates
- Rest of MEA
Competitive Landscape
The leading players operating in this market include Accenture, Capgemini, IBM, Tata Consultancy Services Limited; Infosys; and Trianz. To support growth and improve internal business operations, these key players are investing resources into research & development activities. Companies also engage in mergers & acquisitions activities as well as partnerships to upgrade products further and gain a competitive advantage. They are actively working on new product development as well as product enhancement to acquire new customers and capture more market shares.
- IBM Corporation
- Accenture plc
- Atos SE
- Trianz
- Capgemini
- HCL Technologies Limited
- Infosys Limited
- Tata Consultancy Services Limited
- Tech Mahindra Limited
- Mphasis
- Other Key Players
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