he world moves towards digital countries, cities and companies. It’s stunning to see how our worl...
he world moves towards digital countries, cities and companies. It’s stunning to see how our world is changing at an exponential speed of change. What can be digitized, will be digitized.
Only 8 years ago, the iPhone didn’t exist - in 2015, we download 180 billion mobile apps. Who would have thought that the taxi business, one of the most old-established services, would ever get under pressure so that we see political regulation trying to stop the rise of Uber? The club of the “Digital Unicorns” (start ups worth $1bn thanks to a great and customer-centric idea) is solving issues of billions, and more disruptors are on the rise. Digital Transformation evolves in all industries.
A global leader like Bosch is aiming to connect every product to the internet. The value is significantly increasing once it becomes intelligent and enriched by services. A simple light bulb costs $5 – the value increases ten fold once it gets connected. The most successful disruptors employ “combinatorial disruption,” in which multiple sources of value—cost, experience, and platform—are fused to create disruptive new business models and exponential gains.
As in every game, the Digital Transformation has winners – and participants not seizing the opportunity. What’s the true risk of getting disrupted looking across industries?
On Tuesday, 23rd June, Cisco and IMD inaugurated the Global Center for Digital Business Transformation in Lausanne, Switzerland. Annually, 8.000 executives from all over the world attend management courses at IMD. What a brilliant opportunity to assess and train them on the challenges and opportunities of Digital Disruption! Cisco is investing $10 million over a period of 5 years in people, technology and research.
In the framework of the inuaguration, the Center released its first global research paper on how digital business will redefine industries titled Digital Vortex, How Digital Disruption is Redefining Industries. 941 executives from 13 countries across 12 verticals have been surveyed.
The findings are creating a huge sense of urgency:
4 out of 10 companies will be displaced in the next 5 years by digital disruption.
Digital disruption is not seen as worthy of board-level attention in about 45% of companies (on average across industries)
44% of companies either do not acknowledge the risk of digital disruption, or have not addressed it sufficiently
Only ¼ describe their approach to digital disruption as proactive—willing to disrupt themselves in order to compete.
The 4 most endangered industries are Technology, Media & Entertainment, Retail and Finance & Insurance
Industries at the exterior of the Vortex should remain vigilant – a potential disruptor can come from both inside or outside the industry (start ups). At the end of the day, the one with the big and bright idea solving a true customer-centric problem and no fear of failing will win the game.