In today’s digital age, traditional manufacturing companies must harness disruption before it engulfs them. If you aren’t prepared – your company infrastructure is a natural disaster waiting to happen through digital disruption.

That’s because natural disasters aren’t just restricted to events of nature. Nature of events can run their course in businesses and markets as well. You see, just like a natural force of a tsunami can destroy townships, similar waves of disruption can upend large businesses. Think startups who have nothing to do with the businesses they ultimately end up disrupting!

So what is this new wave of potential disruption?

It’s data and its digitisation.

Google didn’t need a press to overtake the newspaper and magazine publishing industry. Netflix didn’t change one physical aspect of the DVD. And, despite it’s arguably better physical engineering – Nokia got knocked out by smartphones.

Data has found ways to determine who reigns supreme – even among the most sophisticated physical objects. It’s the new oil or primary raw material for the industrial revolution of digitisation. It needs to be mined, refined and distributed. And, those who win aren’t the ones who create new data – but those who figure out what to do with it.

Digital technology has enabled small startups to upset industry after industry. Spotify took just 12 years to reach 2017 revenues of $5.5 billion to replace CDs with streamed music. In less than 10 years, Airbnb grew to $2.6 billion, to unsettle the hospitality industry. And Uber, also less than 10 years old, brought in $7.4 billion as it replaced taxis. These David and Goliath stories show how it’s becoming possible for small startups to set sights on industries whose barriers to entry once ran into the billions.


What does it all mean for us here in NZ?

Firms are realising the impact digital transformation will have on their businesses. Particularly in terms of the associated need to constantly change required skill sets.

A survey of 20,000 employers across 42 countries (including over 650 in New Zealand) found employers are anticipating continued growth in automation to drive an increase in headcount over the next two years. This will require more people and more skills.

On the impact of automation, 20% of New Zealand employers expect to grow their workforce. While 64% plan to maintain their current headcount over the next two years. This implies that digitisation will be a net gain for employment across New Zealand with a new blend of employee skills for the digital age.

However, companies are finding it hard to get the talent they need. This is dangerous for our industry, given the rise in consumerism and value placed on ‘human’ customer service we’re experiencing. How can we maintain the pace of start ups?


It all comes down to people and infrastructure

More than half of New Zealand companies surveyed value skills in communication, problem solving and collaboration. At the same time, manufacturing and administrative functions are expected to decrease as a result of automation. Increasingly it is becoming clear that employee make up is hugely important.That’s why we recently undertook automation assessments for some of our members who expressed interest in it.

Firm infrastructure also needs attention. If you’re a traditional established firm, you need to consider how you can integrate startup mentality – either by building internal capability or working with small startups. Our Innovation READY program addresses this by introducing lean startup principles to help companies embed a startup innovation culture within their organisations.


Natural disasters don’t just happen in nature

Firms are also subject to the natural forces of disruption. That’s why we need to be well prepared to embrace future change.

Digitisation can be a net gain for employment provided we start early and invest in the right skill sets.

If traditional firms can get past bureaucracies and regulations to work with small companies or even embed a lean startup mindset, there’s always the possibility to move forward. And in doing so, you could become the next big disruption story.

We know that data and digitisation can be a lot to take in. We’re here to assist through education, support and facilitation of your journey towards a sustainable future. So why not come in and talk to us about your business challenges. In particular, if you have a product or service you wish to launch and are seeking advice on how best to go about it.

We also recommend you look into our innovation program and how it can help you.