How can traditional companies in S. Korea survive rapid digital transformation?
Updated: 2021-12-02 17:09:26 KST
Building a business is tough, but what's becoming even more challenging is keeping it going.
A recent report by South Korea's Institute for International Trade suggests, the average lifespan of listed companies is getting shorter, possibly dropping down to 12 years by 2027.
That's a drop of 80 percent from 1958.
Perhaps the latest, and the biggest threat to traditional companies is the digital transformation accelerated by the pandemic.
Due to lockdowns and distancing measures,digital technology has penetrated deeper than ever into people's daily lives,. from their work to school, even altering how people spend their leisure time.
Amid this change, only fast movers will survive, while businesses who fail to adapt will die out.
So how should firms prepare?
The report suggests, cooperating with startups and venture firms is key.
Through cooperation, startups and venture firms can provide so-called digital DNA to traditional companies, boosting their ability to face the digital transformation.
Being small and nimble in nature, these firms can quickly adapt to the rapidly changing business environment.
Also, they are better in general at dealing with digital technology based on innovative ideas.
The report says, this means its crucial for economies to develop startups with high potential.
It added that, cooperation between large firms and startups will become a win-win strategy for both of them , where startups can grow their businesses further while traditional firms could capture their innovative attitude.
Kim Sung-min, Arirang News.