Most Companies Feel Threatened by Rise Digital Startups, Need to Embrace Disruption Through Innovation

October 5, 2016

Most existing businesses feel that digital startups pose a threat, either now or in the future, according to new research from Dell Technologies.

45% of global businesses surveyed fear they may become obsolete in the next three to five years due to competition from digital-born start-ups.

52% of business leaders have experienced significant disruption in their industries over the past three years as a result of digital technologies and the Internet of Everything, and 48% of global businesses admit they don’t know what their industry will look like in three years’ time, the research across 16 countries revealed.

“So far the fourth industrial revolution has proved as ruthless as its predecessors. If companies can’t keep up, they will fall behind … or worse. The ‘delay until another day’ approach simply won’t work,” explains Jeremy Burton, chief marketing officer for Dell Technologies.

Progress has been patchy to say the least. Some companies have barely started their digital transformation, Dell says; many have taken a piecemeal approach. While only parts of many businesses are thinking and acting digitally, the vast majority (73%) admits digital transformation could be more widespread throughout their organization.

“Failing to deliver in such a highly contested marketplace could trigger the beginning of a digital crisis,” noted Burton.

Given the “acute threat of disruption,” Dell says businesses are starting to escalate a remedy. To advance their digital transformation, 73% agree they need to prioritize a centralized technology strategy for their business; 66% are planning to invest in IT infrastructure and digital skills leadership; and 72% are expanding their software development capabilities.

“In the near future, almost every business will have software development expertise at its core. Many of these companies will be brand new, others – having not written a line of code in 20 years – will have been on a momentous journey,” says Burton.