3. Future Business Trends: How to Successfully Ride a Wave of Opportunity
Volatility characterises today’s economy. Trends are fleeting yet fierce. They rise and crash like waves — businesses who ride the right trend at the right moment become economic giants, and those who do not are left to tumble in the sand.
Recognising key business trends that will shape the future of our reality is paramount to any company, essentially determining its survival. Whereas some trends are short-lived, some are there to stay. The last decade has marked the emergence of a handful of frontier technological developments that experts agree will completely transform our underlying economic, political, and societal systems. IoT, Big Data, AI, Blockchain all hold the promise of a more prosperous, better-informed, and less labour-intensive future bringing with them a vast untapped potential for businesses to explore.
Despite these trends being seemingly fault-proof, there seems to be a discrepancy between the intention to implement frontier technologies expressed by businesses, and their actual adoption. We now find ourselves in a situation where business prospects move a lot quicker than businesses themselves. Many make the costly mistake of choosing a wait-and-see approach, perceiving these trends as reserved for tomorrow. Many find navigating the wealth of potentialities too overwhelming and address these trends superficially. Some refuse to leave their comfort zones and stick to the strategy that has worked in the past, dismissing the idea of transforming successful strategies in favour of the unknown. Yet, what companies do not realise is that when it comes to riding the right wave, tomorrow may already be yesterday. In some cases, this can simply mean a missed opportunity to increase profit; in the worst case, one hands a possibility to transform the industry to your competitors that are not afraid to take the leap.
Let’s take IoT as an example, which is set to be the largest by market revenue among frontier technologies, according to United Nations Technology and Innovation Report 2021. In 2018, IoT sales totalled $130 billion, and in the next five years could grow to $1.5 trillion. In addition, the range of devices that IoT covers is incredibly vast — already, back in 2017, there were more IoT devices in use than people on earth — 8.4 billion.
Of course, real profit lies not so much in the IoT devices themselves but in the data they produce. IoT data monetisation, be it direct (giving direct access to the data) or indirect (gaining insight from the data to improve and transform business models), is already having a profound effect on business growth for those who choose to implement change.
According to Vodafone’s IoT Barometer 2019, 95% of IoT adopters are achieving tangible benefits from their use of IoT, among which 42% have increased existing revenue streams, and 33% unlocked entirely new revenue streams. Most importantly, 74% of adopters say that, within five years, companies that have not embraced IoT will fall behind their competition. These statistics attest to the fact that there is a very serious financial gain attributable to IoT ventures, but the moment to grasp the opportunity is fleeting rapidly.
Yet, referring to 2018, Gartner estimated that 80% of IoT implementations missed opportunities for real innovation by focusing on narrow use cases and analytics.
The paradoxical problem of organisations acknowledging that business transformation is bound to happen in their future yet refusing to admit the same for the present, is more problematic than it may seem initially. Choosing safety over uncertainty means slow reaction times, which, in turn, can mean that the train has left the station without you.
There are many examples of well-known companies that were unwilling to innovate and evolve with the market and, as a result, trading in their leading role to a marginal one. Those that come to mind are Blockbuster that refused a partnership with Netflix because holding on to a strategy that worked in the past seemed more important, and Kodak that, despite inventing the first digital camera, failed to see beyond their current success and did not recognise a revolution coming. The list also includes IBM, Myspace, Xerox, Yahoo. The crucial take, thus, is that past success, a leading role in the market, and seemingly infinite funds were not enough to recover from a missed opportunity.
Of course, this is not to say that identifying the trends that can work for your business is easy — it takes courage, a lot of research and a clear goal in mind. What is important is to recognise that small incremental changes will not make a big difference. What companies need is a fast-paced, opportunity-grabbing start-up mentality, as well as evolving through partnerships and collaborations that inject new ideas.
In fact, collaboration is crucial to the successful adoption of new trends. Coming back to the IoT example, back in 2017 Cisco has reported that ¾ of new IoT ventures have failed. Subsequent Cisco study found that the most successful organisations engage the IoT partner ecosystem at every stage, implying that strong partnerships throughout the process can smooth out the learning curve.
Moreover, when adopting a transformative trend, companies often start building their ideas from the present, slowly going into the future, trying to integrate their new course without an understanding of how it will eventually align with their business strategies. Instead, they should first clearly define their final goal and work their way backwards. Vision is everything and having clearly expressed objectives means that businesses can afford to go big immediately.
Finally, ignoring trends that are already becoming consolidated is, essentially, setting yourself up for failure. Take an example of a clear movement towards tighter regulation regarding individual rights to their data. The EU has recently announced that their data management strategy for 2021 and beyond is “based on capacity to store, extract and process data, while satisfying the requirements of trust, security and fundamental rights”. This is an evident sign of a trend that is becoming an accepted norm. And yet, companies consistently and repeatedly fail to adjust their business strategy that enables enhanced security and protection of data subjects.
Hence, when it comes to recognising, riding, and fully profiting from a potentially transformative trend, companies need the audacity and capacity to envision the future. Ground-breaking trends should lead the business strategy rather than being marginally included in the existing one, as dynamism and multiplicity should always be preferred over a strategy that worked in the past. Business giants should avoid falling asleep on their laurels and, instead, seek fresh ideas from fruitful partnerships. The world we live in today is moving at an unprecedented pace, and only companies that keep up can stay relevant in the future.