tech-non-tech
Technology Outsourcing

Tech/Not Tech: Why Every Company Is Becoming Tech-Centric

Gartner has said every company is a technology company. Quartz has said there’s no such thing as a technology company any more. Whichever you prefer, it’s becoming increasingly obvious that the lines are becoming more blurred.

Tech Crunch ran a piece on the subject, looking at the growing importance of software and the desire for non-tech companies to own the startups making this software. The list it includes is huge; Staples buying Runa, Monsanto buying Climate Corporation, Target and any number of eCommerce startups, and so on. According to EY’s research, non-Tech companies accounted for around 12% of the buying value in the second quarter of 2013, mostly in the Software as a Service (SaaS) space. This trend continued later in the year, and it’s a fair guess to say it will continue into 2014.

But it’s not just M&As that are being encroached on by the non-technorati; they’re getting involved with tech incubators as well. Coke and Target are both opening a number of incubators in India that are looking to fund and nurture the country’s growing tech scene, and there are more of them spreading throughout Europe.

It’s All About Software, And Hardware

It makes sense though. It’s hard to imagine a company being successful without at least one app and a (good) website that’s fast, intuitive, and has all the right features – whether it’s a shopping cart, music streaming or the digital changing rooms fashion websites are using. Forrester have talked about how software is now the brand, and it’s all about the services (read: software) you provide for your customers, no matter what industry you think you’re in.

But it’s not just about services and apps to keep customers happy. It’s often about data; the better you know your customers, the better you can sell to them. And finally, it’s also about acquiring the talent; in the same way that Yahoo! have been buying every mobile startup they cast eyes on, non-tech companies need tech expertise, and buying your own in-house tech startup is a good way of getting it.

In a more UK-centric example of the tech spread, there’s the supermarket tablet wars. Tesco, Aldi, Argos, and Asda have all released their own brands of low-price tablet in the last year [as did clothes retailer Next a few years ago], all of which have sold very well. The right apps pre-uploaded, and no doubt a healthy amount of data is being sent back the relevant HQ so they can better sell you things.

But it’s not just your local supermarket. Look at the dozens of sport companies jumping on the wearable tech bandwagon. Adidas, Nike, Under Armour and untold others are embracing this sector because, as Forbes points out, why would people want sports tech from phone companies when they can get it from the companies they get all the rest of their equipment from, and probably understand them & their needs better? Even Fashion firms are getting in on the wearable tech craze, and that’s without even getting on to how the auto industry has turned cars into huge computers with wheels.

The Bottom Line

But what does this mean? For one, companies used to having one or two IT guys hidden in the basement may need to rethink things. Have you got enough tech expertise? Are you hiring more tech people to help you move in the right direction? And, shockingly, are you going to throw enough money their way so they can get things done?

So, do you still think you’re not a technology company?

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Dan Swinhoe

Dan is a journalist at CSO Online. Previously he was Senior Staff Writer at IDG Connect.

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