As long as technology continues its creep into every facet of our daily lives, customer expectations for organizations’ products, services, and experiences will continue to evolve. That’s why innovation is so critical.
But the innovation landscape is changing fast—and not in linear fashion.
Why? Because the digital age has amplified the speed and the scale of disruption, thanks to ongoing technological advancement—and things aren’t likely to slow down.
Read on to learn how organizations—in the tech industry as well as traditional industries such as manufacturing and banking—are responding to these changes.
In today's digital world, technology plays a crucial role in driving disruption and innovation—not to mention in the U.S. economy. However, the tech industry is experiencing significant challenges these days—and they’re manifesting in the form of layoffs, declines in mergers and acquisitions (M&A) activity, and volatile stock performances.
Despite overall industry disruption, some tech leaders have responded by focusing on retrenchment and finding places to innovate where they can. Key strategies include a heightened focus on artificial intelligence (AI), digital acquisitions, and consolidating market positions. For example, companies like Alphabet, Microsoft, Meta, Baidu, Alibaba, and Adobe are racing to elevate their in-house AI projects. And the increase in software acquirers buying other software companies, and the growing adoption of AI-related terms during earnings calls, show some industry players are doubling down on innovation.
To effectively compete with both traditional tech companies and digital startups—even in the current environment—industry organizations have been pursuing three core strategies:
1. Digital acquisitions and partnerships. For example, industrial manufacturer Caterpillar made its first acquisition of an energy management SaaS platform in May 2022.
2. Hiring digital-centric talent. Top employers of tech talent now include traditional tech companies as well as organizations in banking and financial services, consulting, healthcare, retail, and defense. In fact, 59% of employees with tech occupations don’t work in the tech industry.
3. Digitizing revenue sources. For example, Walmart partnered with Salesforce in 2023 to roll its retail-focused tech tools into Salesforce’s suite of products. The company’s goal: become a tech-services provider for other retailers.
Every industry, and every organization, is always just one innovation away from complete market disruption. If you're not leaning into innovation by digitizing your business, you're just waiting to be disrupted—and left behind.
Organizations need to recognize that market displacement can occur unexpectedly—and from previously undervalued players. (Just look at how OpenAI’s launch of ChatGPT drove Big Tech companies like Google and Microsoft to kick their generative AI projects into high gear.) Bottom line? Even the most successful companies can lose their position if they fail to adapt.
That's why it’s crucial for businesses to embrace digitization to remain competitive and support an environment of continuous innovation. Those that don’t? They risk being disrupted—and left behind by an increasingly digital world.