Ericsson predicts dematerialization is the path to profitability

As the first report in its Future of Enterprises series, Ericsson IndustryLab asked white-collar workers and ICT decision makers online about the future of their enterprises.

The report is based on 5,000 responses from 11 markets, representing about 175 million employees globally. The report concludes that dematerialization will be key to greater profitability and sustainability in the future. In practice, this can mean moving data and applications to the cloud or switching from physical producing to digital products and services.

Today, almost 7 in 10 of the surveyed enterprises have reached halfway or beyond in their dematerialization journey. Instead of office-based, 6 in 10 businesses expect to move to extended reality (XR), more specifically, augmented reality (AR) and virtual reality (VR) devices, cloud and mobile technology.

With this shift, cellular connectivity will be a key enabler for the transition to remote working and increased profitability. Besides the savings on office maintenance, enterprises can easily set up new branches, contract personnel overseas, or run a worldwide cloud-based e-commerce business with cloud solutions.

Less commuting and decrease in CO2 emissions is also a likely result of the shift towards remote working, as seen during the COVID-19 pandemic. But most enterprises strive to do more than this to increase their sustainability. One approach to reduce the environmental impact, including CO2 emissions, is to decrease material usage through dematerialization.

ICT solutions have the potential to lessen the need for material by substituting physical products with services and digital products. To achieve a net-zero carbon operation, more than half of the surveyed enterprises already use renewable energy for most of their energy needs. Additionally, 8 in 10 decision makers expect to make significant energy saving through the move toward cloud solutions.

Anders Erlandsson, Head of IndustryLab, Ericsson Consumer & IndustryLab, says: “Digitalization represents an enormous opportunity to increase enterprise productivity and sustainability. Indeed, digital technology is a key enabler for tackling big challenges such as CO2 emissions and material usage.”

The surveyed ICT decision makers also agree that ICT solutions such as 5G, XR and cloud implementations will be key in their continued journey towards greater sustainability and higher profitability. “