According to a Wall Street Journal piece, 5G will transform supply chains, in part by cutting waste, better predicting consumer demand, and being able to adjust to market and operational shifts in real time. The gamechanger between 4G and 5G lies in the number of devices that can live on a single connection. By some estimates, 5G is 10 times faster than 4G. This enables more data to be analyzed more quickly and in much greater detail than was possible before.
The advent of 5G makes digital technology an even more integral part of business models and strategies across all industry sectors. In short, technology continues to become only more important as the number of connections—data transmitted, sensors, and IoT devices—proliferate on corporate networks.
Technology already drives the vast majority of value for companies, which makes cyber and the effective management of this technology all the more important to an organization’s financial success. This can be seen through the consistent outperformance over the past few years of companies that do this well, as well as the consistent underperformance of companies that do it poorly. Today, companies seeking to expand operating margins would be hard-pressed to do so without digital technology in the equation.
With the premium importance of data and digital technology to companies around the world and the benefits of digital transformation efforts comes rising financial risks associated with breaches, especially those that result in operational disruptions. This has come into view through shocks experienced by companies such as Maersk during NotPetya and more recently by Travelex and the ensuing fall of its parent Finablr.
The rising importance of digital technology not only to supply chains but to all aspects of business operations and the effective management of that technology (cyber governance) also creates urgency for more market transparency into how well or poorly companies are managing the risks. The market lacks visibility into issues such as: “Is the company spending enough on security?”; “Is it spending money effectively relative to the risks that pose the greatest impact on the balance sheet?”; and “How does it compare to peers?”
This lack of transparency does not exist around any other macro business risk, and the adoption of 5G only makes the need for more cyber governance transparency from companies more pressing.