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Key trends to Create
Value in High-Tech
Technology breakthroughs
have developed at an incredible pace in the last ten years, and show no signs
of slowing down. These advances are driving product proliferation, and creating
new markets — and new competitors. Currently the main shift is from PC to
network; but the current wireless trend will expand many new horizons. By
2002 and foward, communications, and not PCs will see the largest segment
growth within this industry. This will cause businesses to reassess their
product and customer targets. The basis of competition will be between value
webs, much like it is between enterprises today.
The key trends that will
be driving the technology industry in the near future will be:
Rapid
Product Evolution:
Technological advances are driving product proliferation and the convergence
of wireless, Internet and computing functionality, allowing new products to
emerge. Currently the main shift is from PC to network. Wireless technology
will also be a major factor, and will dramatically alter the landscape.
Customer
Focus/Customisation:
As products evolve faster and convergence draws non-traditional competitors,
customer focus becomes a vital driver of loyalty. Bundling and configuring
products and services to customers' individual needs will become increasingly
important.
Operating
Model Complexity:
Firms will begin to follow product evolution trends as they find themselves
playing in different industry segments concurrently, requiring different
business models. The resulting complexity presents major operational strategy
and management issues.
Disaggregation: Partly in response to the
complexity of the operating model and partly in response to the benefits of
decapitalisation, businesses that were vertically integrated are
disaggregating to focus on core competencies and fewer stages of the value
chain.
B2B
Connectivity: A
more complete value web will require greater connectivity across enterprises.
E-business connectivity will both enable and drive further disaggregation.
Internal
Integration and Connectivity: External connectivity will shine a harsh light on internal
disconnects. Complete integration and connectivity of data and process within
an organisation is critical to support external connectivity.
Growth
and Globalisation:
Growth remains an ongoing imperative and globalisation a key strategy to
achieve it. Customers increasingly demand global visibility and management.
Partner and talent access issues drive globalisation on the buy side.
It is our belief that
this set of required capabilities will present a great challenge for
businesses in the future. In the past, firms needed to excel in only one of
three dimensions: operating excellence, customer intimacy or product
innovation. The transformation in the industry requires enterprises to
advance on all three fronts simultaneously — a challenge that only the best
prepared will meet. Please contact us if you have any further questions or
comments.
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