Technology is advancing at an unprecedented rate, and Canadian companies are not poised to deal with this, according to a Deloitte report released April 28.
This lack of preparedness is so acute that Canada’s economy is at risk from what the report refers to as “technology-driven disruption.”
“We looked at five advanced technologies: advanced robotics, artificial intelligence, networks and sensors, advanced manufacturing/3D printers and collaborative connected platforms,” Terry Stuart, chief innovation officer at Deloitte Canada, told Business in Vancouver.
The study found that only 13% of Canadian companies – large and small – are prepared for the disruption that those technologies could cause as a result of not being ready to adapt. The results were the same across all industries.
“The disruption could be reduced revenue for them because their competitors are leveraging the technologies to be more effective, or it could wipe out their businesses altogether because others are taking advantage of the technologies and delivering new business models,” Stuart said.
Stuart provided the example of Blockbuster Video as a company that ultimately folded due to its lack of adaptation.
“Blockbuster rented CDs and movie discs, while Netflix started streaming their product,” he said.
“In less than four years, Blockbuster had to file for bankruptcy and now Netflix is changing the game in terms of entertainment distribution.”
The study also found a significant “preparedness perception gap,” where 43% of organizations think they are positioned to deal with changing technology.
Deloitte didn’t compare Canada’s technology preparedness to that in other countries, but Stuart said anecdotally, companies in the United States appear to be better poised than those here to react to advancements.
“By and large, Canada has lagged other countries,” he said, pointing to Silicon Valley as a model of an environment that is adaptable to rapid change.
“Having said that, there are some companies [in Canada] that are very prepared, so it’s not that we are behind across the board.”
The Deloitte study found that there are ways a company can deal with evolving technologies. One is to increase awareness of all possible forces that could disrupt the businesses. A company can also look at their internal culture to determine if it promotes and encourages internal innovation incentives. As well, it put into place structures that can react quickly to advancing technology.
“Our productivity and innovation agenda for the country is abysmal and we need to be much more aggressive at changing in what we invest in R&D and how we take advantage of these advanced technologies.”
Stuart called this “an important wake-up call” for Canadian companies