Right now, somewhere in New Zealand, there is a young lady sitting in her bedroom, writing code to create a platform that will source then distribute your product better than you can. In another bedroom, far away, there’s a young lad busily writing an app which will provide your service with more efficiency and at a cheaper price than you are. In 5 years time these young people will be your biggest competitor. Do you think I’m exaggerating? Take a look at the 22 year old in Christchurch, Jorgen Ellis, who has built a company to become one of the fastest growing franchises in the world. While working at Bunnings, as a teenager, he saw an opportunity. He developed his idea and recently raised $6 million in capital while expanding to Australia, the UK and the Netherlands. During 2017 and 2018 the company has sold more than 100 franchises. This company is called Flatpack Global.
To keep up with these young entrepreneurs, companies need to be transitioning to tech-based businesses. When we think of becoming fully tech, our thoughts jump to Robotics, and Artificial Intelligence however, the transition begins at a more basic level. It starts in the storeroom and accounts department with the implementation of cloud-based solutions. It means collecting data on all the processes in the business then analysing this data to improve efficiencies. The whole business needs to become digital. Everyone from the cleaner to the board members need to buy into the transition. They don’t need to understand how it all works but they do need to be enthusiastic about the transition to better processes. If a company is not on this journey already then it will surely die.
Companies of the future will be lean. Many of their processes will be contracted to out-workers. Businesses will be able to find highly specialised people anywhere in the world, to complete projects for them. These out-workers are another growing phenomenon. They are well-educated, experienced people working from home, servicing half a dozen different clients. In the next five years there will be a massive growth of people, both young and old, working from their homes. What this means to businesses is that their work will become more project based than continuous servicing, when money is lost through down time. It means companies will not need the overheads of employees but will be able to calculate a fixed price for each job or service. Although, the work force will change, more jobs will be created through out-sourcing.
Once the digital foundation is laid, technologies like Internet of Things and Robotics can be introduced. Not only does a business owner need the latest technology to run the business but they need to be making their own products or services more high-tech. Take manufacturing as an example, manufacturers of the future will not be exporting container loads of product, instead, they will be exporting the software that makes the product. They will be manufacturing only for their local market and their physical production line will be managed by software controlling all its processes. All that is needed to duplicate the production is the software. This software can be sold to manufacturers throughout the world, who will set up the machinery needed to duplicate the process. Ongoing income can be gained through support of the software.
R & D has never been more crucial than now. Digital solutions are growing exponentially therefore all products and services need to be improving to meet modern expectations. Over the next 5 years the top performing companies will look different and act differently. They will stand out as being high-tech even though they may have non-tech products. Whether they are in manufacturing, financial services, hospitality or any professional service they will be software based because businesses of the future will be fully immersed in the digital world.