Only 25 percent of companies are taking proactive steps to address digital disruption, said a Cisco study.
The report — Digital Vortex: How Digital Disruption is Redefining Industries — investigated the state of digital disruption and the outlook for industries via a survey of 941 business leaders in 12 industries and 13 countries including Australia, Brazil, Canada, China, France, Germany, India, Italy, Japan, Mexico, Russia, United Kingdom, and the United States.
Digital disruption will displace approximately 40 percent of incumbent companies in each of the 12 industries studied for the report within the next five years. 45 percent of companies do not believe digital disruption merits board-level attention.
Most executives see digitization as a positive for business and society. 75 percent believe that digital disruption is a form of progress, 72 percent said it improves value to customers and 66 percent feel it empowers individuals. 43 percent either do not acknowledge the risk of digital disruption, or have not addressed it sufficiently, said Cisco.
Technology Products & Services has the highest potential for digital disruption over the next five years. Data-driven industries top the disruption potential list, including Media & Entertainment, Telecommunications, Financial Services and Retail.
Executives from incumbent companies in all 12 industries revealed they expect substantial change due to digital disruption, including shifts in market share within five years. A third of incumbent companies is taking a wait and see approach, in the hopes of emulating successful competitors, said Cisco.