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The Changing Landscape of Disruptive Technologies The changing landscape of disruptive technologies Global technology innovation hubs kpmg.com/techinnovation The changing landscape of disruptive technologies 2017 I Contents: 1 Foreword 2 Global growth of a tenacious tech innovation ecosystem 8 Innovation management insights 13 Tech innovation country perspectives 14 Australia 22 Korea 15 Canada 23 Russia 16 China 24 Singapore 17 Germany 25 South Africa 18 India 26 Taiwan 19 Ireland 27 United Kingdom 20 Israel 28 United 21 Japan States 30 Conclusion 32 Survey demographics and methodology 34 About KPMG © 2017 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. Foreword KPMG member firms recognize As in prior years, we include insights from our annual The spread of tech innovation development is survey of more than 800 global technology leaders being fueled by growing ecosystems as technology the importance of innovation including start-up entrepreneurs and FORTUNE 500 innovation has permeated all industries. Technology to the technology industry and executives. The 2017 publication is issued in two continues to enable an unprecedented rise in parts, featuring the following topics: creativity, across the world, to solve business the global economy as a whole. problems and develop new markets in ways never KPMG’s publication series, The Part 1 | Global technology innovation hubs thought possible. At the same time, the success of showcases the rise of new ecosystems of Silicon Valley’s entrepreneurial culture continues to changing landscape of disruptive incubators, accelerators, and venture capital incentivize countries, all over the world, to become technologies, now in its fifth alongside government incentives across the leading technology innovation hubs. Some countries world. In this section, we unfold the cities and are accomplishing their objective to become a year, provides perspectives about countries that are making significant strides in leading innovation hub, while others continue to face technology innovation trends, innovation development and provide 15 country macroeconomic and infrastructure challenges. top barriers to commercialize perspectives. With stakes so high to compete in Now more than ever, companies across a broad a global technology industry ecosystem, we also array of industries are being impacted by the rapid innovation, and insight into examine the global leadership views on innovation pace of change in digital arenas. Global and cross- technology innovation leading management. industry collaborations and partnerships are key to staying ahead, as is learning how to embrace change Part 2 | Disruptive technology trends and barriers practices. in a nimble way to avoid the status quo for fear of to commercialize emerging technologies. In this failure or uncertainty. issue, to be released in April, we examine the emerging technologies with the most potential to We hope you find this publication insightful, and we disrupt industries and transform business models. welcome your suggestions for the next edition. We also assess the monetization opportunities of these disruptors and adoption challenges by region and industry. Tim Zanni Global and U.S. Technology Sector Leader Chair of Global and U.S. TMT Line of Business, KPMG, LLP © 2017 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The changing landscape of disruptive technologies 2017 1 Global growth of a tenacious tech innovation ecosystem United States and China show most promise for disruptive breakthroughs Many countries realize innovation investment is critical to increase economic growth. The investment, development, and adoption of new technologies continues to spread out from the Silicon Valley epicenter to tech hubs around the world. As tech innovations unfold, China is stacking up prior year. China continues to make rapid gains to the United States as a leading force. Global as the country moves from manufacturing to an tech industry leaders indicated, in KPMG’s tech innovation powerhouse led by its large mobile and innovation survey, the United States and China are digitally advanced consumer and enterprise base. the world’s dominant tech epicenters—with the Visionary entrepreneurial leaders such as Jack Ma of greatest potential to develop disruptive technology Alibaba have become known and respected globally. breakthroughs that will have a global impact. Chinese tech titans, Baidu, Alibaba, Tencent, and The strong showing for these two mega-powers others, are entering overseas markets, and are is relatively consistent with earlier KPMG surveys, earmarking leading start-ups for acquisition and although this year’s poll reflects a slight uptick for investment. China—25 percent compared with 23 percent the © 2017 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. 2 The changing landscape of disruptive technologies 2017 No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The results reflect a small decline for the United development of products and services that can The United Kingdom jumped significantly in the States—26 percent forecast it as having the most break through in developed and emerging markets. global rankings. As many as 10 percent of the survey potential for leading edge advances, down from On this scale, India places third globally for the respondents selected this country for developing 29 percent a year ago. This slip does not reflect a second year in a row. India’s mobile-first generation potential technology breakthroughs compared with declining status for U.S. tech leadership but rather the and its reliance on local business models are helping only 4 percent the prior year. Government initiatives expansion of innovation across several geographies in India to progress. India is home to nine start-ups such as Innovate U.K. are focused on driving and increasingly developed digitalized markets. valued at more than $1 billion. More and more start- accelerating innovation by investing in small high- Accordingly, India and the United Kingdom are seen ups are targeting the domestic Indian market as growth companies in key market sectors and by respondents as progressing with innovative tech businesses shift from serving global markets with providing access to cutting edge technologies. hubs of their own, showing progress in the outsourcing. The results skew by regional responses, showing some nationalistic bias. Which country shows the most promise for disruptive Responses by region and country: technology breakthroughs that will have a global impact? NORTH AMERICA ASIA EMEA Nearly half Respondents EMEA tech named from Asia leaders United States 26% the United selected selected the 46% States as the 35% China most 22% U.K. at 22%, innovation often (35 ahead of China 25% center leader. China only percent). The United States China (18%), and behind the drew an 18 percent response drew a mere 13 percent U.S. (27%). from U.S. and Canadian India 11% respondents. United Kingdom 10% UNITED STATES CHINA Among those polled in the Those in China rated their U.S., national favoritism own market exceptionally Partial list of countries shown. Percentages do not sum to 100%. is even more pronounced high, at 59 percent, while Source: KPMG Technology Innovation Survey, November 2016 49% with 49 percent singling out 59% the United States drew the United States. only 9 percent. Source: KPMG Technology Innovation Survey, November 2016 © 2017 KPMG International Cooperative (“KPMG International”), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG International. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The changing landscape of disruptive technologies 2017 3 Innovation hubs Shanghai seen as biggest up and coming leader Technology innovation In addition to Silicon Valley/San Francisco, which three cities around the world will be seen is spreading globally, as a leading technology innovation hub over the next four years? fed by government initiatives, venture Shanghai, China New York, U.S. Tokyo, Japan Beijing, China London, UK capital, corporate strategic investment, universities and incubators. Many cities want to be recognized as a leading global technology innovation 1 2 3 3 5 hub. The survey revealed numerous
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