Ricoh and the Economist Intelligence Unit (EIU) launched an in-depth report to provide business leaders with a unique insight into the ways technology will change organizations between now and 2020. The EIU report, which was sponsored by Ricoh, reveals that the development of existing technologies will continue to significantly influence business models and practices over the next decade. Businesses will have nowhere to hide from the disrupting yet energising effects of technology change. Those with flexible processes, agile structures, and the right tools for their people and customers, will be able to adjust quickly and will find technology-led change invigorating and laden with opportunity.
The need for change, as a result of technology, is largely attributed to an increase of low-cost computing power, storage and bandwidth available via the cloud. It is also recognised that organisations will continue to accumulate increasing volumes of data, from a growing variety of sources at accelerating speeds, the trend known as “big data”. In addition the increase of video-based communication, social media and other tools will all become more widespread in business. Interestingly, these technologies are already in existence and while new technologies are likely to emerge, it will be the new ways that current technologies are applied that will continue to drive radical change to business models.
Carsten Bruhn, Executive Vice President, Ricoh Europe PLC says “New technologies by themselves won’t necessarily help companies keep up with the changes required to survive and grow. It’s the business processes behind the technology that must be reviewed and optimised to add real business value. At the heart of this change is ensuring the processes connect people with information, enable greater collaboration and encourage knowledge sharing. Business leaders need to choose partners that will help them to implement the changes effectively over time. It is no longer viable to implement new technologies for short term efficiencies.”
The view that innovation in processes and methods is arguably more vital to business model change than innovation in technology is further highlighted in the report. In the technology industry the introduction of Apple’s online App Store in 2008 did not result from introduction of a wholly new technology instead it was the result of a rethink of the existing ways that software was marketed and distributed, ending in the development of a more efficient platform and set of processes. In addition eBay and Facebook have captured leading positions in the market by creating new business models from existing technology.
Further key findings reveal that:
- Few industries will remain unchanged by technology disruption. Six out of ten surveyed business leaders agree that the vertical market in which their organisation operates will bear little resemblance in 2020 to how it looks today.
- For those who can master it, "big data" will become a business of its own. The European Commission estimates that government data alone could add some €40bn (US$55bn) a year to the European economy by stimulating the growth of new information services.
- As transactions are automated and collaboration becomes more virtual, the purpose of physical stores and offices will change. Just as banking transactions are now largely automated, with bank branches becoming more consultative spaces, so too will many other customer-facing physical premises.
- By 2020, customers are expected to supplant traditional R&D as the primary source of new product and service ideas. Respondents also believe that customers will by then be nearly as important a source of ideas for business process improvement as their own employees.
- There will be a shift towards decentralized decision making - 63 per cent of business leaders predict a shift towards a more decentralised business model and that responsibility for business decision making will move from centralised management boards towards individual employees.
- The organisation of 2020 will be more transparent than ever before. Firms will find it hard to hide poor service, high pricing or unpopular practices in the decade ahead, as technology makes them more visible to end-consumers than ever before.
The report titled, ‘The future of technology disruption in business’ draws on two main research inputs for its findings. First, a global survey of 567 executives was conducted in September and October 2011. All respondents were at senior management level, with nearly one-half (46%) from the board or C-suite. Respondents were from a wide range of industries including financial services, government and the public sector (including healthcare), education, professional services, technology, and manufacturing. Of the firms polled, 43% had annual revenue of US$500m or more. A series of in-depth interviews were also conducted with leading technology and business thinkers, as well as senior executives in different sectors.
The full report and executive summary can be downloaded from www.ricoh-europe.com/thoughtleadership.