Published on the 24/06/2014 | Written by Beverley Head
Deloitte Digital has revisited its landmark Digital Disruption report from 18 months ago and found that in those sectors most impacted by digital change there is a growing gap between the winners and losers…
Two thirds of the Australian economy will see significant disruption over the coming five years as digital technologies allow start-ups and new ways of doing business to render traditional business models, if not obsolete, then terminally threatened.
That was the thesis of Deloitte’s Digital Disruption; short fuse, big bang report released 18 months ago. Revisiting that hypothesis recently the organisation has confirmed its predictions and also noted that in those sectors most impacted, the performance gap between the digital front runners and laggards continues to grow.
John O’Mahony, director of Deloitte Access Economics, said that in some sectors there had been a 10 percent increase in revenue dispersion (the gap between the revenue growth experienced by the front runners and the decline among the laggards) between the winners and losers. The more digitally disrupted the sector the greater the gap.
“Established players are experiencing revenue decline…new attackers are getting growth,” he said.
Releasing a new report; Harnessing the Bang; stories from the digital frontline, Deloitte has worked with a series of companies in digitally disrupted sectors such as telecommunications, retail and banking, to examine the sorts of new approaches that are being employed by companies to win the digital race.
While many sectors in the first wave of digital disruption (ICT and media, retail, financial services) were already responding, Deloitte said that those organisations which were on a “longer fuse” were about to face disruption. According to Frank Farrall, Deloitte Digital lead partner, this included healthcare, education and government services.
Over the next two to three years Deloitte is forecasting that these sectors will face significant digital disruption and according to Farrall; “This is where we see the biggest changes to society.”
He said that there were already early signals of the disruption ahead, for example citing the release by Apple of its HealthKit intended to support the development of health apps for its devices. Farrall said that for many sectors Apple was the “canary in the coalmine” and that when it began to invest in a sector it was a sure sign of major disruption ahead.
