Digital Transformation is the Now Frontier, but is the U.S. Ready to Embark?
The Covid-19 pandemic accelerated the need for businesses worldwide to implement new digital technologies in order to meet the demands of the rapidly changing world.
Digital transformation not only helped businesses become more resilient during these uncertain times, but also puts them in a better position to face volatile market dynamics in the future, including the impacts of climate change.
In 2015, the United Nations signed and published the 2030 Agenda for Sustainable Development—a blueprint for peace and prosperity for people and the planet made up of 17 integrated global sustainable development goals (SDGs).
Climate Action is listed as goal number 13 (SDG 13), however it has become increasingly clear that climate action plays a role in many, if not all of the SDGs. As such, achieving the 2030 Agenda will be impossible without taking urgent action to combat climate change and its impact.
Businesses and governments have a significant role to play in taking crucial climate action, but progress from both political and business leaders needs to be swift. The ultimate aim is to keep global temperatures from rising more than 1.5 degrees Celsius above pre-industrial levels. Anything more will lead to catastrophic consequences for the planet and failure to achieve many of the other SDGs.
The Glasgow Pact, signed and aligned to during COP26 helps to further SDG 13, and affirms the importance of engineering and utilizing the best available technology and innovation for effective climate action.
“Our estimates, made with the World Economic Forum, show that by 2050, digital technologies can reduce greenhouse gas emissions by up to 20% — particularly across the energy, mobility and materials sectors. - Peter Lacy, global sustainability services lead and chief responsibility officer at Accenture.
To avoid the most dangerous and irreversible effects of climate change, the world would need to limit global warming to 1.5 degrees Celsius. In order to achieve this, carbon emissions would need to reach net zero by 2050, meaning that across the entire globe people, corporations and governments are adding no more emissions to the atmosphere than they are removing. Failure to meet these goals can have irreversible economic and environmental ramifications.
For many years now, companies around the globe have been gradually transforming themselves with carefully planned initiatives and digital transformation road maps. But when COVID-19 hit the digital road maps of nearly every company were compressed into days and weeks. Seemingly overnight, digital transformation shifted from an initiative for the forward-thinking few to a vital strategy that all businesses need in order to build resilience, innovation and a competitive advantage in the face of uncertainty.
The talent crunch—an imminent skilled labor shortage—could ultimately shift the global balance of economic power by 2030 if left unaddressed.
The U.S. should be leading the charge, but the country made less headway in the race towards digital transformation than other affluent countries. The lack of a clear transformation strategy, necessary skills and know-how, and engineering support needed to implement digital transformation were reported to be significant barriers to progress in the United States.
Without drastic changes to close the talent gap, the United States could lose out on $1.748 trillion by 2030 due to labor shortages, forfeit its place as a global technology leader, and fail to take proper action to address the impacts of climate change.
Through a series of articles, Ready Player Ventures will explore several key factors contributing to the talent and innovation gap occurring in the U.S. and the critical role that minority-led VC firms play in shaping the future of technology, achieving the 2030 SDGs, and helping the U.S. lead the way into the now frontier of digital transformation.