Entrepreneurs need little convincing that technology is important, rapidly evolving, and likely to have a profound impact on their businesses. But keeping track of developments, and knowing where to focus one’s attention, is anything but straightforward. Analysts at PricewaterhouseCoopers (pdf) say the impact of constant technological breakthroughs represent a “megatrend” – a change so big that “every business should develop an emerging technology strategy”. They have highlighted eight key areas that all businesses should pay attention to.
The artificial intelligence market is growing rapidly and forecast to be worth $36bn by 2025. Prof Michael Feindt, a former Cern scientist and now chief scientific officer at predictive applications company Blue Yonder, says machines can learn from past experience better than humans can and are very effective at making unbiased predictions. Feindt says this is a powerful tool in highly competitive, low margin markets such as retail. But machine learning takes time and requires a lot of data. “The most important piece of advice I would give to small businesses is to keep all business-related data – don’t throw anything away,” says Feindt. “Data is valuable.”
Augmented reality (AR)
Augmented reality and its better known cousin virtual reality (VR) are coming to the fore and revenues from these industries are forecast to reach $120bn by 2020. But PwC innovation consultant Jeremy Dalton, says there are clear differences – VR is an “immersive experience” whereas AR provides the ability to place a virtual image into a real environment. A car engine manufacturer, for example, would be able to create a holographic image of a proposed design. “You’d be able to walk around it, look closely at all the different parts and understand the idea before it has been created,” Dalton says. “This has huge implications for businesses involved in manufacturing, architectural design and prototyping.”
Blockchain is best known as the ledger that records all bitcoin transactions. But entrepreneurs have spotted there are many uses of blockchain or distributed ledger technology (DLT) and investment is pouring in. Prof Andrei Kirilenko of Imperial College Business School says DLT has the potential to disrupt countless industries and is the “next big thing” for financial services. “Blockchain, or DLT, is a bunch of computer code that literally anyone with a computer or a smartphone can use to create, exchange and record value,” says Kirilenko. “A very useful side effect of this technology is a complete, immutable and, at the same time, freely observable record of transactions.”
Because the blockchain is effectively unhackable, it can work as a highly trusted source of information. This enables users to validate themselves and others, speeding up transactions and trade. “From an economist’s perspective, lots of value can be unlocked through this technology by allowing individuals to supply or demand valuable resources without permission from the governments or financial institutions,” Kirilenko adds.
Dr Kevin Curran, senior member of the Institute of Electrical and Electronics Engineers, says the rapid advancement of drone technology, combined with a desire to reduce fuel costs, means drones will become commonplace over the next five years – PwC estimates the market will be worth $127bn by 2020. Curran predicts supermarket deliveries, aerial photography, advertising at public events and security/surveillance will all make use of drones soon. But he warns businesses to take note of concerns regarding safety, privacy and of Civil Aviation Authority regulations. “Drones have rapidly developed in a short space of time,” says Curran. “In the future, we could well see businesses look to the skies.”
Internet of Things (IoT)
Researchers at Gartner estimate there will be 6.4bn “things” connected to the internet by the end of 2016. Heidi O’Leary, principal consultant at Market Gravity, says she expects to see big growth in “smart home” technology such as smart thermostats, connecting lights and security systems, as well as wearables such as smart watches, fitness and payment devices. O’Leary says many of these products are in their infancy, but expects “substantial scale over the next five years”, although she says there are still big challenges in convincing consumers there is value in these items. “Most industries are still working out how to create customer value from IoT, and therein lies the opportunity for small businesses and startups,” she says. “Entrepreneurs can act quicker and don’t have to adapt big legacy systems and data architectures to the world of connected devices. However, big businesses have the data and the scale and therefore we see a great opportunity for collaboration.”
Experts say the global robotics and automated devices market is now entering a smarter phase and will be worth a predicted $226bn by 2021. Graham Mackrell, managing director of Harmonic Drive UK, which has created parts for Nasa missions to Mars, says collaborative robots (cobots), which can “mimic and learn” tasks from humans, are set to revolutionise workplaces. There are many applications, he adds, from material handling and automotive manufacturing to dispensing in pharmaceutical and food processing that cobots could help with. “A human worker can stand next to a robot, hold its hand and guide it through a delicate task. This movement is perfectly recorded in real-time and the software can begin to automatically programme the necessary commands, allowing the robot to repeat this task again and again,” he says.
Virtual reality (VR)
Dr Wendy Powell, lecturer in VR at the University of Portsmouth, says the affordability of VR now makes it within reach of even the smallest of businesses. “It offers a huge range of opportunities for business, from product visualisation to virtual tours, training employees in safety-critical processes, even improving health and wellbeing of staff and customers,” she says. “Larger businesses have been using VR for quite a long time for product design and visualisation, as well as simulation and training. The difference now is that cost is no longer a barrier. Even the smallest business could consider investing in some 3D product marketing, such as a 360-degree video virtual tour.”
Prof Hari Mann of Ashridge Executive Education predicts the 3D printing market will revolutionise manufacturing as a whole, enabling the creation of affordable, bespoke products produced locally. The sector is estimated to be worth more than $30bn by 2022. “I think we will see much faster delivery of items, including bespoke items, as they will be printed locally,” Mann says. “Businesses need to start thinking about how they can adapt and interact with these technologies when they become more affordable. They need to start to plan for how they will use 3D printing in the future.”
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