Cisco report claims rise of new technologies will see nearly 40 percent of companies needing to readjust their focus within the next five years
The rise of new and advanced digital business processes is set to catch out many businesses who have failed to prepare adequately for their implementation, a new report has predicted.
As many as 40 percent of firms could be caught out by ‘digital disruption’ as larger firms ‘go digital’ in order to ensure they stay at the top of their game.
That’s according to Cisco, which has teamed up with the International Institute of Management Development (IMD) to set up a new initiative called Global Centre for Digital Business Transformation that will help businesses prepare for these changes.
For its launch, the Centre carried out a survey of 941 business leaders across 13 countries to examine the possible effects of digital disruption.
Overall, the study found that approximately 40 percent of companies in each of the 12 industries studied for the report could be displaced within the next five years, as hungry, digital-ready start-ups and smaller competitors take their place.
Perhaps unsurprisingly, the companies involved in the ‘Technology Products & Services’ were most at risk, but the report also highlighted how other data-driven industries including Media & Entertainment, Telecommunications, Financial Services and Retail, also scored highly, due to their reliance on technology-enabled networks to exchange digital value, including data and transactions.
The disruption is being driven by well-funded start-ups, digitally proactive competitors and, increasingly, the merging of industries as digitisation frees businesses to expand their value in new markets.
Yet, the survey indicates that nearly a third of incumbent companies are taking a “wait and see” approach, in the hopes of emulating successful competitors, and that 45 percent did not believe digital disruption merited board-level attention.
In fact, most of the executives surveyed saw digitisation as a positive for business and society, with 75 percent stating that they believed digital disruption to be, ‘a form of progress’, 72 percent saying it improves value to customers, and 66 percent feeling it empowers individuals.
“Every country, every city and every business will be required to become digital in order to thrive and survive in the new digital economy,” said Martin McPhee, senior vice president, Cisco Consulting Services.
“The Global Centre for Digital Business Transformation, which brings together digital disruption and education, will serve as a platform for executives to be educated on the why, what and how required for their digitisation journey and the ultimate sustainability of their organisations.”
Do you know the secrets of Cisco? Take our quiz!