Competition out there is ruthless – even before the current macro climate, the writing was on the wall: companies that stuck to their guns in not changing the ways of working were going bust or losing value. In the meantime, companies open to change and embracing technology were outstripping their peers in terms of valuations and profitability.

Industrialists are smart, and have been the silent drivers of the world economy for the past 100 years.

globe industrialists tech startupsBut the old rules are changing. Building non core expertise in-house or de-facto owning the supply chain has negative returns on investment.

At the same time, the ecosystem of small to medium-sized, lean, agile and ambitious technology service companies has been growing at breakneck speed.

More competition and higher dynamism in the capitalist landscape of companies equals higher profit and higher value creation.

This is why I think that you, the industrialist of the future, should accelerate your engagement with the tech ecosystem out there.

Industrialists are smart, and have been the silent drivers of the world economy for the past 100 years. But the old rules are changing... Click To Tweet

6 reasons why industrial corporates who engage with tech startups will win

1. Division of labour

You might be good (and efficient) at making pinheads, but not the entire pin. A wider application of Adam Smith’s division of labour strikes to the heart of why different people, companies and organisations should be allowed to specialise in their own individual trades.

pinhead industrialists profits

Engaging in self gratification via failed empire building, and attempting to provide services which have nothing to do with core company specialities, just does not make sense.

Instead of building in-house expertise for non core areas, ask yourself: is there a company out there that is already specialised in delivering this service?

Jack Macfarlane Tech Industrialists2. Smartest minds

An increasing number of the sharpest young minds are risk takers, and the fruits of tech companies are compelling for them.

This means that the allure of traditional stable corporates is no longer what it once was. Informational barriers and job mobility means that talent is more mobile, going between companies and the attachment to the corporate less strong. A way to tap these resources is by commercial relationship with the firms who employ them – rather than direct hiring.

mark zuckerberg tech startupHire the best for what the core expertise is for your company. But do not think that, just because you are the biggest steel producer in the world that you will naturally be able to compete with start-ups for software engineers.

3. Breaking traditional thinking

Agile. Change. New ideas.

These can only happen if you have not become used to the status quo. No number of consultancy led “innovation breaks” will snap you out of the incumbent funk.Agile tech startups industrialistsHundreds of early stage companies are out there taking a “white canvas” approach to solving your problems, not burdened with the paths of old that in many instances result in the output you want to change.

4. Competition

Competition IS GOOD. It breeds better value and services. Building in-house or not engaging with sufficient new external technology companies is succumbing to monopolistic behaviour. Communism failed… It is time many corporations came to terms with it.

competition tech startup

Foster competition by engaging with a number of external service providers. Bid out new business regularly. Signal your desires and business needs to give companies a shot at delivering for you.

5. Economies of scale

The chances are, if you have a business need, and it is non core expertise that can satisfy this need, many of your peers will have the same need.

So why build in-house? It is non core, so not really a competitive advantage. The scalability of many of these business solutions means that the marginal cost of every extra user this service is delivered to <1. So by having it in house, and only allowing it to service your 1 company, you are burning value. Just burning cash.

burning cash industrialist

Embrace a platform approach – trust the external ecosystem to deliver on your and your peers’ needs, and reduce overall operational costs in the industry you operate within.

6. Cost

Directly feeds on from 1, 4 and 5. Stop waiting for commodity prices to jump back up and bail out your industrial corporate. Move to a leaner and more operationally efficient way of working.

Having lean overheads, fixed costs and a more acute use of resources within your company will turbo-charge your profitability.

tech startup saves you money procurement

The easiest route to this is to embrace hungry agile technology companies that are all a click away.

Are you ready for a change?

DeepStream is just one of many, many agile and best-in-class technology providers out there solving the pain points we see in industrial commerce. We encourage an open, fair and aggressive playing field where technology companies are not locked out of old boys clubs and entrenched vested interest. If you would like to see how we use our agile technology to solve your supply chain needs, please get in touch with me directly on

Jack Macfarlane

Jack Macfarlane

Jack Macfarlane is the CEO and founder of DeepStream.