How to decode the trends shaping the future of electronics:

Introducing The Global Electronics Agenda

The Electronics industry is driven by perpetual change. In fact, it feeds off of it. And the amount of change contained in the first 50 years of our industry’s existence seems almost quaint compared with the pace of change today. It sure comes at us rapidly. Consider that:

  • 47.3 million U.S. adults in just two years — or 20 percent of U.S. adult population — are interacting with smart speakers, up from zero a few short years ago.(1)
  • Microsoft Kinect demonstrated machine vision as a tool in gaming and quickly found it suited for robotics, lending itself to industrial applications. So gaming becomes a practical way to understand business (as opposed to the other way around).(2)
  • Eight quantum computing startups joined the IBM Q Network, in 2018 — for tech that is supposed to be years from commercialization. (3)
  • Consumers are increasingly aware of the data collected about them and how it is used. In the US, 93 percent of U.S. consumers believe they should be able to delete their online data when they want. Research shows 69 percent of consumers believe that companies aren’t doing everything they can to protect data.(4)
  • The first “IoT device,” a cobbled together Coke® machine that allowed computer programmers and others at Carnegie Mellon to see the status of their favorite beverage, gave birth to a massive technology revolution. IoT is on track to connect 50 billion “smart” things by 2020 and 1 trillion sensors soon after, according to the National Science Foundation.

Electronics never stands still as an industry. That’s probably why we are all so passionate about what we do.

The changes, however, go beyond tech. After years of technological factors being the number one impact for executives in IBM’s C-Suite study, in 2017 Market Factors came out on top. It might be hard to admit but it’s true: technology is not a durable advantage anymore. The speed with which the market is changing can make any feature obsolete, potentially before the costs are recouped. What we’re experiencing not isn’t a tech revolution. It’s a business model revolution.

IBM C-Suite Study for Electronics

Digital giants — those platform based companies with outsized revenue and profits are actively in play, and some are targeting the Electronics industry. While electronics executives prefer to maintain that our industry is doing the disrupting as opposed being disrupted, clearly, there is pressure for each executive to examine what he or she is doing, in light of changes in the market.

IBM C-Suite Study for Electronics, Q1.4b What types of enterprises are leading the disruption within your industry? — Digital giants (e.g., Google, Apple, Facebook, Amazon, Alibaba, Tencent)

The ability to shift into a highly connected, collaborative and co-created marketplace is fundamental to understanding the new market dynamics. Consider a universe for a moment where an electronics company has an app (because I am sure each of you has at least one app). I’m sure it’s a great app. It interacts with customers 1:1 — they love it.

But now, consider a platform, with multiple apps, that are part of a shared market where a company offers an understanding of the industry, rich in data and potential insight. A market platform has services that benefit from complementary partner services. Growth is driven by proximity and opportunity (fishing in the right barrel). Users understand the platform’s purpose and welcome additional recommendations because they make sense.

Yet, tech is still a primary enabler to electronics strategy. Cloud, edge, virtualization and IoT will only take on more unique and interesting roles for electronics companies. AI, which has existed since the 50’s and has gone through at least two “AI winters” where spending has dried up, has finally hit its stride. Robotics are a reality — whether they’re physical instantiations or their chatbot or process automation counterparts.

It’s hard to know when to act — especially in a challenging market. Understanding how to prioritize the next 2–3 years is what sets your enterprise up for longer term success.

The goal is not to say “IoT will grow x%” or “Virtual Reality will finally deliver on its promise.” Those sorts of forecasts you can get in plenty of places. We want to discuss deeper concerns for instance, how AI might commoditize products (from Martin Kienzle) or how virtualization changes the game from Peter Xu, perspectives you aren’t likely to see elsewhere.

What is the Future of Electronics? What are you going to do about it?

Global Managing Director, Bruce Anderson and our global experts will to provide some critical thinking on the Future of Electronics. We brought 22 electronics experts from around the globe to discuss the future of our industry and what would we expect in the next 2–3 years. This site is where many of them will share their perspective with you.

Over the course of the next month, we will feature articles on:

  • 5 disruptive forces (from AI to virtualization to the pace of change)
  • their impacts on consumers, markets and enterprises.
  • We’ll address the challenges facing electronics leadership (both the “must do” and differentiating)
  • provide a perspective/forecast on the technologiesthat both enable and sometimes add complexity to their decisions
  • Then, we’ll go deep on opportunities we see for the future.
A few of the notes from one of the early conversations, CES 2018

Baselining the Future

Roy Amara said

“we tend to overestimate the impact of a new technology in the short run, but we underestimate it in the long run.”

Expert Mashup

This document, the Global Electronics Agenda, represents a partnership between two expert communities in IBM: The Industry Academy (IA) and the Institute for Business Value (IBV)

  • The IBM Industry Academyis a vibrant community through which IBM’s most eminent and innovative industry visionaries can shape global industry agendas, capitalize on multi-industry collaboration to be essential partners to our clients, and cultivate future industry leaders.
  • IBM Institute for Business Valuedelivers thought leadership, business insights and leading-edge thinking to help organizations execute innovative solutions.

This work has not been published anywhere else, so this is our way of sharing it with you.

Please be sure to follow us to receive updates along the way. We want to challenge your thinking but we also hope to engage in dialogues. Let us know what you’re thinking. Share your perspectives. We’d love to hear from you.