As digital disruption is accelerating across all industries, top market leaders will be outgunned by challengers quick to adapt to a digitization wave, according to a Cisco executive.
Presenting a recent report about technological disruption and future business models at Cisco’s office in Songdo, west of Seoul, Thursday, Ross Fowler, president of the U.S. firm’s Digital Transformation and IoE (“Internet of Everything”) Acceleration in Asia-Pacific and Japan, said that ”one out of top 10 companies across the industries will be displaced in the next five years (due to digital disruption).”
Even though most leading companies surveyed in the report said they were taking digital disruption seriously, only 1 in 4 companies had a digital strategy in place to respond to the forthcoming changes, the Cisco executive said.
The report, titled “The Digital Vortex,” was published by the Global Center for Digital Business Transformation, a research institute established by the California-based information technology giant and IMD Business School to expedite industrial digitization in the markets.
Cisco anticipated the potential value created by digitization, or what the firm calls the Internet of Everything, in a range of industries including information technology, media and telecommunications will reach around $19 trillion in the next decade. The manufacturing sector, in particular, will be able to generate $6.3 trillion by deploying digital technologies.
“As a result of general organizations not moving quickly enough, almost 76 percent of potential values are not being realized, it is still sitting on the table,” said Ross Fowler adding that “as the world is not moving fast enough, Korea (a manufacturing powerhouse) can grab this opportunity to lead the world in digital manufacturing.”
Many global information and communications technology companies are paying keen attention to digitization of their business processes from production to distribution.
Joining hands with Cisco, General Electric is developing smart manufacturing solutions, aimed to enhance production capabilities and efficient management of corporate assets.
There are 277 smart factories utilizing the Internet of Things, big data and cloud technologies in operation in Korea, while 686 plants are being refurbished with the up-to-date digital technologies according to the Ministry of Trade, Industry and Energy.
The Korean government aims to increase the number of smart factories to 1,200 by the end of this year.