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The Accelerating Business Environment

The speed of business is accelerating. Technology-enabled Accelerators — a set of scientific, product innovation, economic and societal forces — are disrupting markets, causing profound changes to customers, competitors and the broader business environment. These disruptions are transforming business models, resulting in significant changes to, among other things, revenue streams, cost structures and the underlying ways companies do business. Transformed business models, creating higher value ever more efficiently, are in turn driving continued growth in Accelerators.

Every indication is that this cycle will continue to accelerate.

 

Technology-enabled forces are accelerating change.Multiple technology-enabled forces are accelerating innovation and socioeconomic change on a global basis. We have identified seven distinct yet interrelated groups of Accelerators:

Exponentially-Advancing Digital Technologies. You might think of this Accelerator in the context of Moore’s Law, named after the co-founder of Intel, who predicted in 1965 that the number of transistors on an integrated circuit would double every two years. History has shown that Moore’s Law applies not only to processing power, but also to other digital technologies, like memory, storage, network bandwidth and software functionality.
Connecting Everything. Refers to how individuals, businesses and entire communities are all being connected to each other via the Internet, on both a fixed and a mobile basis.
Bioinformatics. Biology is converging rapidly with digital technologies, in the process becoming programmable, much like computers and software.
Revolutionizing Manufacturing. 3D printing, robotics and other technologies are creating the Do-It-Yourself Maker Revolution, a key development that promises, among other things, to bring offshored manufacturing back to developed economies.
Progressing Material Sciences. Breakthroughs, such as nano materials, are changing what is possible in areas ranging from aeronautics to energy to medicine.
Racing for Sustainability. The growing challenges of climate change, pollution and resource depletion are being offset by greentech innovations in renewable energy, efficient buildings, cleaner transportation and sustainable industry practices.

 

Accelerators are disrupting markets.Technology-enabled Accelerators are disrupting markets and industries on a global basis. These disruptions include:

Empowered Customers. Greater information and choices are making customers — both businesses and consumers — more discriminating than ever before.
Unexpected Competition. New competitors and products are emerging from unexpected places. It’s not just traditional competitors you should worry about now, but ones emerging from developing markets or being funded through crowdsourcing sites like Kickstarter.
Distributed Innovation. Breakthroughs are no longer limited to big companies and governments, but rather take place in organizations of all sizes, located everywhere around the world.
Fast and Flexible Supply Chains. Enabled by the Manufacturing Revolution, companies are using a mix of both global and local manufacturing to serve markets effectively.
Imbalanced Talent Pools. Companies increasingly have too few employees with the right skills and too many with the wrong ones.
Lagging Government Policies. In many cases, governments are failing to keep up with the rapid pace of technological change.
Shifting Financial Sources. New sources and structures for financing business and innovation have emerged.

 

Business models are transforming. Responding to these disrupted markets and industries, business models are transforming rapidly as companies race to:

Target new geographic, demographic and needs-based customer segments
Deepen customer relationships through social media and analytics
Create higher-value but lower-cost distribution channels
Develop new offerings with superior value propositions
Focus only on differentiated activities that drive the greatest value
Develop and protect in valuable resources like human talent and knowledge assets
Manage relationships with partners who play increasingly critical roles
Take into account changes to the most important costs associated with operating a business
Understand how the methods used to generate revenues differ across various customers segments