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Technology breakthroughs

In our latest Global CEO Survey, business leaders told us technology is one of the biggest
disrupting forces in their organisations. One aspect is that the time it takes to go from
breakthrough technology to mass-market application is collapsing. In the US, it took the
telephone 76 years to reach half the population. The smartphone did it in under 10 years.
The price of new technologies is falling equally rapidly: since 2001, the cost of DNA
sequencing per genome has plunged from US$96m to less than US$6,000. At the same time,
digitisation via the internet has created extraordinary value, as exemplified by Google. And
social media is steadily strengthening its position as a dominant force in the day-to-day lives of
people across the globe, enabling many of the worlds top brands to capitalise on it to deepen
their relationships with customers.
Indeed, the impacts of digital disruption are now so pervasive that no business in any sector
from the smallest family business to the largest multinational is immune from them. And the
pace of technological advances hasnt slackened at all during the past year. Far from it.
According to MIT Technology Review, in 2014 alone weve seen breakthroughs in technologies
ranging from agricultural drones that enable higher crop yields, to neuromorphic chips
configured like human brains; from microscale 3D printing of an ever wider range of products,
to agile robots that can walk or even run across uneven terrain; and from ultra-accurate, big
data-enabled weather forecasts that will boost the contribution from renewable energy, to
genome editing that will help tackle previously baffling brain disorders.
All of these advances either help to solve complex problems or open up new ways of using
technology or both. And in each field the progress to date is just the start.
So, whats next? Over the next decade, we think the transformative potential of digital for
consumers will play out in three waves:

The First Digital Wave: well see more and more companies adopt e-commerce or add
a web channel to their existing portfolio. In this wave, even fairly traditional organisations will
make this move.

The Second Digital Wave: digital will move beyond a channel to an economy of
outcomes. That means well see businesses teaming up with the consumer to find an outcome. A
good example would be that a number of companies today are involved in helping us live healthier
lifestyles.

The Third Digital Wave: this will be driven by consumers taking back their digital
identity and extracting value from it. Youll see consumers owning their digital brand and expecting
organisations to know what they want and to really deal with them as individuals.
Across these successive waves, companies will find value by uniting four aspects of digital:
Social, Mobile, Analytics and Cloud. For businesses, having a digital strategy will no longer be
enough. Instead, theyll need a business strategy fit for the digital age.

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