Fourth Industrial Revolution

These 6 trends are shaping the businesses of the future

The cashless and contactless artificial intelligence driven store at the Sheikh Khalifa Energy complex in Abu Dhabi.

Business will transform in 2022. Image: REUTERS/Satish Kumar

Johnny Wood
Writer, Forum Agenda
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The Digital Transformation of Business

  • The pandemic and the technological revolution are fundamentally changing today’s business world.
  • Organizations that rethink, reshape and reinvent themselves will be best placed for the future.
  • Trends include learning from real-time data and integrating the physical and virtual worlds.

“This past year, business models have been reinvented. Supply chains have been restructured. Promises of new scientific breakthroughs have been suddenly realized. Productivity, we now know, can thrive virtually.”

So says a new report, Business Futures 2021: Signals of Change, from professional services company Accenture. It highlights how the transformations taking place in the business world are forcing companies to rethink the what, where and why of their operating models.

Here are the six key trends highlighted in the report.

1. Learning from the future

Look forward rather than back. Relying on historical analytics models and past performance data may not be fully relevant in today’s ever-changing business landscape.

New analytics approaches powered by artificial intelligence (AI) can identify data patterns in real time, helping to anticipate trends and inform decision-making.

Removing constraints created by existing mindsets and organizational structures is also needed to help firms stay one step ahead.

2. Pushed to the edge

Become an “edge” organization, where teams are part of a network but have autonomy to decide how best to optimize local performance while still meeting corporate goals. In effect, this means moving computing power, data storage and decision-making to the edge of operations.

Technological advances and the pandemic-induced switch to remote working have boosted connectivity and information flows, allowing organizations to collaborate efficiently over distance.

Operating at the edge promotes agility, speed to react to changing local preferences and frees up HQ to focus on strategic decisions.

3. Sustainable purpose

Build sustainability into everything. Companies that take social responsibility seriously create value for all stakeholders – staff, shareholders, customers, communities and the planet. But business leaders need to go beyond having good intentions and show that they are actually delivering on them.

Operating sustainably is also good for business. Companies with high ESG performance have operating margins on average 3.7 times higher than those with lower ratings, as well as annual returns 2.6 times higher, according to Accenture’s research.

Widespread integration.
Companies are now integrating sustainability into most business practices. Image: McKinsey

A McKinsey survey shows that sustainability is moving beyond mission and value statements, with more than half of respondents integrating sustainability into functions such as strategic planning, marketing, internal communications and operations.

4. Supply unbounded

Break the physical limits of your supply chain. Throughout the pandemic, organizations have had to stay agile to meet changing consumer expectations on order fulfilment. And many of these changes are here to stay, Accenture’s report predicts.

Forward-thinking companies are restructuring their supply chains and moving production closer to the point of demand. This could include adopting micro-fulfilment centres to reduce delivery times and serve more customers from a smaller space, or using route-optimization algorithms to reduce delivery distances, avoid traffic jams and increase on-time drop rates.

A worker uses a virtual reality headset to simulate flight at the workshop of Israeli Startup AIR.
“Real virtualities” will create opportunities for organizations and individuals. Image: REUTERS/Nir Elias

5. Real virtualities

Integrate the virtual and physical worlds. Virtual reality will eventually expand to include all our senses, and these “real virtualities” will become part of everyday life.

Real virtualities will create opportunities for companies and individuals, allowing them to buy and sell virtual goods and services – something that is already happening on multiplayer gaming and other platforms. These could include using digital currencies, onboarding employees, creating virtual prototypes or digital twins of industrial processes.

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6. The new scientific method

Become a scientific company. Scientific-led disruption can help create better, cheaper and more sustainable products and services, opening up new markets.

AI and robots have enabled a stream of COVID-19 vaccines to be produced in record time. Similarly, some foods can now be generated in a lab rather than grown or reared in fields.

The Accenture report predicts that just as every company has already had to become a digital company, they will soon have to become a scientific company to benefit from innovation.

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