Emerging tech risks high on the radar for tech companies
Today’s leaders have to contend with a whole host of risks spawned by the economy, geopolitics, global health crises, climate change, cybercrimes, regulatory evolution and increasing digital demands on today’s talent pool.
For tech company leaders, a new set of risks is rising with the emergence of new technologies and the disruptions they bring to business models. Executives constantly have to decide which emerging technologies to invest in, and how much, to make their businesses more successful in the near term while mitigating risk. These decisions are made with today’s best available information, with the hope that a new and unforeseen innovation won’t disrupt them tomorrow.
Little wonder then that emerging technology risk consistently ranks as one of the top threats to growth for technology companies, as revealed in KPMG Technology Industry CEO Outlook surveys.
Entering the metaverse has changed the rule book. As the emerging technology expands the boundaries of the internet, new and evolving cyber considerations are becoming more apparent, including digital impersonation, interoperability, account takeover risk and data protection. These are further complicated by the varying definitions and opinions on when the technology will reach maturity and mass adoption.
Metaverse use cases are developing, but for technology companies the top near-term ones (from now to 3 years out) center on employee training and collaboration, the convergence of IoT with metaverse experiences and digital twins.
In a recent study of 767 technology, media, and telecommunications executives conducted by Forrester Consulting on behalf of KPMG International, many respondents appeared reluctant to invest heavily in the metaverse in the near term.
Source: A commissioned study conducted by Forrester Consulting on behalf of KPMG, December 2022
TMT leaders are, however, more bullish about the metaverse’s longer-term potential.
6 in 10
believe the meatverse will have a huge impact on consumers and buisnesses. Three out of 10 believe it is the future of human interactions.
In the five- to 10-year outlook,
A path forward for tech companies
There is inherent risk with investing heavily in new technologies. There is also risk in doing nothing. How can technology companies leverage the metaverse while mitigating risk? Here are some considerations:
Consider being an early adopter
While hype and excitement are not a basis for investment, don’t rule out being an early adopter. With many companies holding back on investment until customer demand increases, a near-term investment plan can bring first-mover advantage and avoid the need to play catch up.
Be a realist
Establish a solid business case and identify expected impacts. Be clear about what you hope to achieve by moving into the metaverse. Set realistic key performance indicators.
Weigh action vs inaction
Quantify the upside for your specific organisation and compare it with the risk of not moving fast enough — because wait-and-see is conversely a high-risk strategy.