Digital is exposing weaknesses in traditional businesses: Gartner

Technology research group Gartner says that digital business are exposing, and even exploiting weaknesses in industry incumbents.

Speaking at the annual Gartner Symposium/ITxpo in Cape Town on Tuesday, Peter Sondergaard, executive VP: research at Gartner highlighted the success of Amazon and its disruption of the retailer sector.

“Customers flocked to online store and the big department stores lost. This year Amazon became the largest retailer in the US. E-commerce and digital is affecting every retail sector,” he said.

Sondergaard said that the grocery sector is next, following Amazon’s foray into the grocery business with the acquisition of Whole Foods.

He said that digital is winning over consumer demand thanks to efficient supply chains and distribution models, along with an intelligent marketing strategy.

These digital business are exposing the weaknesses in current systems, Sondergaard said. He said that some incumbents like Ford and Toyota have responded, citing their digital metrics capabilities.

Gartner said that businesses need to create their own set of digital key performance indicators (KPIs). “Some leaders measure themselves on the number of partners in their ecosystems. You might measure yourself on the numbers of ecosystems you participate in, and the outcomes of each.”

Sondergaard said that the most vital KPI relates to speed. He said that business leaders are growing impatient with the slow pace of change within their organisation. “Business leaders believe their companies must pick up the pace to remain competitive,” he said.


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Digital is exposing weaknesses in traditional businesses: Gartner