KPMG: These three technology trends will dominate business transformation in the next three years | Leibao

There is no doubt that AI, IoT and robots are becoming the three major areas that will affect the future global economy. Recently, KPMG conducted a global survey of 841 corporate executives (90 of whom are from China) and released the "2017 Disruptive Technology Change Trends" report. The survey results of the report confirm this view. point.

Leifeng.com has compiled and analyzed the original report. To get the original report, follow Leifeng.com’s official account and reply with the keyword “ KPMG ”.

Looking at the entire report, there are three key points:

Three technologies that will drive business transformation in the next three years: IoT, robotics and AI

Several factors hindering technological innovation and commercialization

Global CEOs' insights into technology innovation and practice

The technology industry will continue to promote unprecedented global cross-industry and cross-field cooperation. In general, there are four trends in global economic development:

• IoT (Internet of Things) will see exponential growth in the collection of data. Devices connected by IoT will become smarter.

• With the development of technology, the flexibility, intelligence and sensors of robots will also be enhanced. Machines are expanding the range of things that humans can do.

• The next wave of AI development will be a major development in cognitive intelligence, further simulating how the human brain learns, understands, makes decisions and takes actions.
  

• Increased computing power will greatly improve data processing capabilities in the coming years.
  

These technologies are changing business models across industries and unlocking huge market opportunities. If industry leaders fail to quickly address breakthrough technology issues, their competitive advantage will become very short-lived.

In response to the question "What is the most important technology that will drive business transformation in the next three years?", KPMG surveyed 841 executives worldwide. A total of 20% of respondents chose the Internet of Things, 11% chose robots, and 10% chose AI.

Tim Zanni, Chairman of KPMG's Global and US TMT business, said in the report that the integration of emerging technologies including the Internet of Things, robots and AI is creating new market value and replacing existing products and services. These technologies are driving profound changes in industries, business models, life, society and the environment.

1. Internet of Things

In KPMG's technology innovation survey, the Internet of Things received high scores in Asia, with India, South Korea, China and Japan accounting for 30%, 25%, 19% and 18% respectively.

In addition, Germany, the United Kingdom and Israel also scored highly for the Internet of Things, at 23%, 19% and 18% respectively.

Previously, IDC released its latest forecast that global IoT spending will increase by 16.7% year-on-year to more than $800 billion in 2017. By 2020, global IoT spending is expected to reach nearly $1.4 trillion. At the same time, companies will continue to increase their investment in hardware, software, services and connections that support the IoT.

When asked, "Which industries have the greatest monetization potential from adopting IoT technology in the next three years?", these technology industry executives are more optimistic about the monetization potential of the Internet of Things in the technology field.

The final survey results showed that 11% of corporate executives chose the technology field, while the proportions for customer service/retail, medical/life sciences, and driverless/transportation were all 9%.

2. Robotics

As the second most important technology that will drive enterprise transformation in the next three years, robots are gradually expanding the limitations of what humans can do.

As shown in the figure, in this survey conducted by KPMG, the United States and Japan both expressed very positive expectations for the corporate market prospects of robots. In this question, 15% of executives in both countries expressed a positive attitude, while Germany and Israel each accounted for 13%, and China accounted for 12%. These countries have been taking aggressive actions in innovation and factory automation.

So far, industrial robots have accounted for more than half of the total robot market. 2016 is a major turning point for industrial robots. According to Tractica estimates, the revenue share of industrial robots in the global robot market will drop to 41%, while 59% of the revenue will come from non-industrial robots used by consumers, enterprises and the military. According to Research and Markets, the global robot market will reach $226 billion by 2021.

3. AI

在过去十年中，数据和计算能力的显著增长激发了人工智能领域的创新。在毕马威调研的841位高管中，共有10%的人认为AI将成为未来三年推动企业转型的第三大重要技术。其中，新加坡占比15%，南非占比14%，澳大利也和以色列各占比13%，而日本为12%，居其次的还有印度和英国各占11%，美中韩各占10%。

AI is embedded in platforms, chips, software, and a variety of smart products and devices, and this phenomenon is becoming a leading innovator in business models.

According to IDC, the global revenue of cognitive and AI systems will reach 12.5 billion US dollars in 2017, an increase of 59.3% compared with 2016. At the same time, global spending on cognitive and AI solutions will continue to increase in the next few years, and the compound annual growth rate (CAGR) will reach 54.4% by 2020. In addition, the global revenue of cognitive and AI systems will reach 46 billion US dollars by 2021.

So, which industries have the greatest monetization potential due to the adoption of AI technology in the next three years? As shown in the figure above, in KPMG's survey on this issue, the financial services and technology industries ranked first, accounting for 11% each, followed by medical/life sciences, accounting for 10%, and the telecommunications industry accounted for 9%, ranking fourth.

1. Three major factors hindering technological innovation

The constant change of disruptive technologies requires a series of obstacles to achieve monetization success. So, what is hindering technological innovation?

According to the results of the KPMG survey, platform integration, return on investment and access to capital are the three major factors that limit or hinder innovation, accounting for 24%, 22% and 21% respectively. Although the rate of access to capital is roughly the same as last year, platform integration and return on investment (14% last year) have both increased.

Among them, in terms of return on investment, from a global perspective, Israel (31%), Singapore (30%), Australia (28%), South Korea and Canada (27% each), as well as Japan and India (24% each) all rank at the top.

2. Seven obstacles to commercial applications

Generally speaking, addressing barriers to commercial adoption is critical to achieving market leadership.

As can be seen from the above figure, technological complexity and obtaining investment have become the biggest obstacles to the commercialization of technological innovation, with 36% of respondents choosing this option respectively. Other obstacles include risk management, cybersecurity, regulatory compliance, privacy management and government policies, accounting for 35%, 32%, 29%, 29% and 28% respectively.

Among them, the complexity of integrating traditional and emerging technologies is increasing, which is the first time that KPMG has surpassed cybersecurity in the five years since it conducted this survey on the technology innovation industry. Compared with 24% last year, the ratio of this factor has increased significantly this year, reaching 36%.

Under this clear trend, regulatory compliance, privacy management and government policies are all seen as the most prominent obstacles, with the nomination rate of these three factors almost doubling compared to last year. KPMG predicts that this trend will continue.

3. Industry blocking

Many companies are becoming software companies, and the boundaries between products, services, and industries are blurring. As more consumers and businesses adopt emerging technologies, the technology industry will continue to be the engine of global innovation. So, which industries will face rapid transformation driven by emerging technologies?

As shown above, driven by the Internet of Things, robotics and AI technologies, industries such as finance, technology, and healthcare will have the greatest commercialization potential in the next three years.

However, in general, the four major industries that are most affected by emerging technologies are technology, driverless/transportation, medical/life sciences, and consumer/retail. Among the 841 respondents, 15% voted for technology, while the latter three accounted for 14%, 13%, and 11% respectively. From this point of view, technology is the first to be affected and has become the industry that has undergone the fastest and most thorough transformation driven by emerging technologies.

In this year's global CEO survey, KPMG surveyed 92 CEOs in the high-tech industry in the world's 10 largest economies and obtained the latest insights. The results show that under the continuous competitive pressure, CEOs are more focused on managing the company's core business advantages and changing the way the company creates value.

In the eyes of these CEOs, the most important strategic initiatives for their companies are as follows:

• Speed ​​to market

• Fostering innovation

• Promoting disruptive technologies

• Enhanced data-driven

• Digital Business
  

Due to the emergence of emerging technologies, CEOs intend to increase staff in areas such as middle and senior management, R&D, and human resources. Among them, 50% of CEOs said that their companies do not have the ability to respond quickly to innovation and transformation, and 52% are more concerned about the process of integrating cognitive and AI technologies. At the same time, 65% of respondents believe that technological innovation is an opportunity rather than a threat to their companies, and 74% of representatives said that their companies are trying to become "disruptors" in their fields.

In addition, CEOs are also expanding the scale of innovation and laying out the company's core business with a technology-oriented approach. 48% of respondents said they are worried that their company's business model will be "disrupted" by new entrants that they do not currently consider competitors, and 70% of CEOs are more willing to accept new cooperation than ever before.

Between now and 2020, CEOs also predict that they will hire more talent in multiple areas to support emerging cognitive technologies. More than 75% of executives are optimistic about IT growth, with 64% of middle management talent demand, 62% for customers and services, and 60% for sales and production. Another 43% hope to increase senior management, and more than 50% of respondents said they will increase talent investment in research, human resources, and marketing.

Conclusion

As the report states, the technology industry is driving unprecedented global cross-industry and cross-field collaboration, which requires not only a shift in strategic thinking, but also a proper handling of the interactions between technologies.

The complexity of technology, funding and risk management are challenging the commercialization of new technologies. Regulatory compliance, cybersecurity, privacy and government policy are also more challenging than in the past for leaders in the technology industry. Not surprisingly, this trend will continue.

As emerging technologies develop, economic, ethical, social, risk and regulatory issues will bring more uncertainty to the industry. In this case, change becomes the best option for CEOs, or perhaps the only option.

Note: The original report comes from KPMG's report "The Changing Landscape of Disruptive Technologies" (2017). The original report can be obtained by following the Leifeng.com official account and replying with the keyword " KPMG ".