A shock wave in the form of a new industrial revolution is taking place. It’s reshaping the foundations of many industries. And it’s bringing down the walls between others as the boundaries between suppliers, producers and consumers and, in some cases, between whole industries shift.
Technological change is creating historic shifts in industry footprints. Over the next ten years, we think this process will accelerate. Traditional industry classifications will need to be rewritten. Where industry boundaries begin, where they end and who are the main players will all be up for grabs in a number of sectors. We look at what’s happening in different industries. Will we see a new industrial order? Are completely new sectors emerging? And, crucially, is your company ready?
All industries will need to be ready to stretch their horizons. Advanced technology adoption will be at the heart of future competitiveness. It doesn’t necessarily mean the walls will come down between all industries. But we do expect all industries to be transformed by the technology shockwave, lowering cost bases and improving operational efficiency as well as demanding greater integration with customers and suppliers. In many sectors, it is likely to transform competitive metrics and open up industries to new start-up entrants or incumbents from other sectors.
In the logistics industry, some of the sector’s own customers are starting up logistics operations of their own, and new entrants to the industry are finding ways to carve out the more lucrative elements of the value chain by exploiting digital technology or new ‘sharing’ business models.
The retail sector was in the forefront of the first wave of the walls coming down with traditional retailers being eclipsed by more nimble and agile online models. But the realignment of the boundaries of the sector still has a long way to run.
Digitally-enabled technology systems are expected to significantly reduce the cost-per-barrel of future hydrocarbon resource exploitation. And the gains of integrating technology and services are bringing down walls in the oilfield services sector.
Even an industry as specialised and far up the supply chain as mining is not immune to the walls coming down. A number of developments, such as bioengineering of microorganisms and the potential of blockchain technology, are pointing to a technology-transformed future.
1. Have you got an outcomes focus or are you still stuck in a physical product mindset?
2. What are you doing to avoid commoditisation of your business?
3. Are you building a platform presence?
4. Are you leading with or being left behind by advanced technology?
5. Have you got your timing right?
This ‘Future of Industries’ report discusses these and a number of other questions. Download it to find out more and join in the discussion with PwC.