No matter what industry your business is in, you’ve probably been affected by digital disruption—or you will in the very near future. Half a century ago, a company listed on the S&P 500 index could expect to prosper for an average of about 60 years, but digitization and other forces have reduced that average lifespan to just 18 years today.
Going digital is on the minds of nearly every executive today, but executing digital strategies seems to be a slower process. However, here’s a look at four industries that have already been transformed by digitization, and the further changes the future may hold for them.
Media & Entertainment
One industry that has experienced particularly significant changes at the hand of digital disruption is the media and entertainment industry. The way that customers purchase and use services like cable television, movies, and music has seen a dramatic shift to digital through the development of streaming services like Netflix, Spotify, Hulu, and many others. Accordingly, some of the biggest players in the tech industry are branching outside of their original areas of focus in order to provide customers with instant, unlimited access to shows, films, and songs.
The new industry-leading providers of streaming services are still looking for ways to offer their customers better products, primarily by curating higher quality collections of content. The future of the industry, however, is anticipated by some to trend toward more interactive experiences. The Internet of Things may create new media channels through the connection of multiple devices, giving consumers more options for real-time interaction with their favorite media.
Companies in the finance industry have a long history of staying relevant by adopting innovative technologies soon after they’re made available. Automation and industry-specific software are consistently used by finance companies in order to create more efficient processes and delegate simple tasks, freeing up time for employees. Even in the banking sector, many companies have already created fully digital platforms for clients to use, opting out of traditional brick-and-mortar banking altogether.
Digitization will likely continue to streamline accounting and financial processes even further, giving companies new options for providing clients with services at accelerated rates. The financial firms involved will continue to adapt to new technologies, as they historically have. However, one element that could bring a huge change to the industry’s future is the development of digital currencies, like Bitcoin. Unregulated and offering a high degree of anonymity, digital currencies may disrupt the way that money changes hands, forcing financial institutions to create new standards for monetary transactions and accounting.
The effects of digitization in banking can already be seen, with the advent of a digital dollar called the Bitt that acts in place of paper currency in the Caribbean island nation of Barbados.
Digitization is about more than the implementation of new technology. It’s about making everyday processes more efficient in order to increase customer satisfaction. It should come as little surprise, then, that the automotive industry has already seen some major changes thanks to digital disruption, and is headed toward bigger changes in the near future.
In recent years, many companies have made a name for themselves as sustainability leaders through the development of electric cars. Many of these manufacturers are also beginning to offer their products at increasingly affordable prices. Rising concern about climate change and a consumer desire to identify with brands that make sustainable products have encouraged the automotive industry to shift in a more eco-friendly direction.
While cars have conventionally stood as emblems of personal freedom, many now wonder how long that association will last as digitization take root. Industry-leading companies will continue to brainstorm new ways for drivers to connect digital devices to their cars and develop advanced safety systems like pedestrian detection and electronic stability control for new models.
In addition, many observers point out that the automotive industry is inching toward an even more futuristic paradigm: the creation and mass availability of self-driving cars.
Leaders in the manufacturing industry are paying more attention to the importance of digitization than almost any other industry. However, as a whole, they still are not allocating significant resources to pursuing the advances available to them.
Digital technologies have enabled manufacturers to work more collaboratively with global partners, making product design more efficient and enhancing the planning process. Advanced analytical tools have generated more accurate forecasting trends, and increased connectivity between machinery has led to better quality management.
The future of manufacturing will be significantly impacted by the growth of the Internet of Things. As our devices become more connected, collected data will allow manufacturers to gain better insight into consumer behavior, and hopefully create more successful products and generate bigger returns.
Another big factor in the manufacturing sector is the success of 3D printing. Parts that previously required mold casts or forge work to assemble can now be created with the click of a button. Additionally, manufacturers can now explore the possibility that expensive specialty tools and parts needed for certain products could be created by their own company for pennies on the dollar.
Digitization and 3D printing may allow smaller-scale manufacturers to sustain themselves without the help of larger suppliers and their highly specialized, costly machinery. This may create better options for partnerships as small, niche manufacturers enjoy better opportunities for market penetration.