The Press and Journal (Inverness, Highlands, and Islands)
Riding the waves of digital technology
Scottish businesses urged to embrace change or risk being ‘swept away’
Technology is forcing dramatic change across the business landscape – and UK firms are in danger of getting “swept away” because they fail to acknowledge the risk of “digital disruption”, a new report has warned.
All Scottish businesses should look at the dramatic changes in retail and media to understand how digital technology could transform their industries, according to a study published by the Federation of Small Businesses (FSB).
The organisation is urging Scottish firms to use technology to unlock markets, develop products, improve efficiency and build customer relationships.
The paper argues that all business sectors are likely to change dramatically as the use of a range of interlinked emerging technologies becomes more widespread.
Digital Disruption and Small Business in Scotland has been produced by Jim Hamill, business fellow at Strathclyde University’s Business School. It examines international evidence and local data, and argues that many Scottish firms could be swept away by the forthcoming wave of change. An international study highlighted in the research suggests that four in 10 of the largest firms, across a broad spectrum of industries, will be displaced in the next five years as a consequence of digital disruption.
Industries facing the greatest change include hospitality and travel as well as financial services. Oil and gas is thought least likely to face disruptive change due to technology, the study added.
Already firms like Uber, which is the world’s largest taxi company but which owns no taxis and Air BnB, the world’s largest accommodation provider that owns no property, are showing how the landscape has changed.
These business models enabled by new technology thus have significant implications for policymakers in Scotland, the FSB has argued. For example, regulatory and taxation systems may have to change to ensure that newentrants play by similar rules to traditional operators.
Andy Willox, the FSB’s Scottish policy convener, said: “Government can give Scottish business a handby, for instance, ensuring new players aren’t given an unfair advantage. Regulation needs to be sufficiently smart to adapt to newbusiness models while not stifling innovation. We can look again at enterprise support and education to make sure our businesses can make the dramatic changes required.
“But ultimately the onus is on business owners themselves to use these new technologies to develop a better, more resilient business.”
The research comes ahead of the Scottish Government’s National Economic Forum, taking place on Wednesday November 25, which will be looking at the digital economy and cyber resilience. Dr Hamill said: “Technology needs to be at the heart of your operations.
“A range of converging technologies mean that no industry or business is immune from new competition. But conversely, the digital revolution means that nimble and determined
“Four in 10 of the largest firms will be displaced in the next five years”
Scottish firms can unlock opportunities and tap new markets.”
FSB’s 2016 Scottish Parliament manifesto calls on the next Scottish Government to consider the impact of digital disruption and to make digital infrastructure – including broadband and mobile – a national priority.