Quantum technology: The next big disruption?

By Martin Streichfuss and Michael Alexander

No one knows when quantum computing will be ready for real-world application. But what is already evident is that the technology has the potential to transform the economy and society at large. Companies expect it to have an increasing impact on their business models over the coming decade, as a survey of executives from a wide range of industries across Europe found: Most respondents expect the ultra-fast computing technology to bring significant change because it will serve to accelerate the ongoing digital transformation and also trigger brand new disruptions. Almost two-thirds of the executives therefore intend to give the topic greater prominence in their strategic planning.

Future use cases for quantum computing hold enormous potential, not just on the technological side but also commercially: Quantum technology could be used to solve optimization problems for which even the best classical computers take a very long time. It could enable fast simulations and modeling of complex structures that currently require years of testing in the lab. It has the potential to speed up algorithm training and optimize machine learning, and it could revolutionize cryptography. And once the technology is in real-world use, there will be other applications that we can't even conceive of today.

Business models in automotive, pharmaceuticals and chemicals likely to benefit

Business processes with a high data intensity are likely to benefit most from the possibilities offered by quantum technology. It will be particularly relevant for business models and supply chains in the manufacturing sector, such as in automotive, pharmaceuticals and chemicals, but it will also have its uses in fields like finance and transportation.

Quantum computers could be used, for example, to model the chemical processes inside batteries and thus produce more efficient batteries for electric vehicles. And the properties of molecular structures and active substances could be analyzed with quantum simulation, which would enable the development of new materials or drugs. Algorithms, artificial intelligence and machine learning systems would be propelled into new realms of possibility, creating the essential preconditions for applications such as autonomous driving to take off or systems for the automatic detection of diseases like cancer to become reality. And the finance industry could solve complex optimization problems that are beyond the capacities of even the largest supercomputers.

R&D investments on a massive scale

Although we don't yet know when the breakthrough in quantum computers will come and qubits will replace today's bits, an interesting market is currently developing for the technology, thanks in part to public funding on a massive scale: Whereas budgets are being cut elsewhere, record sums are flowing into quantum research. Countries the length and breadth of the globe are currently investing EUR 22 billion per year, with China alone spending 10 billion, followed by Germany with 3.1 billion and France with 1.6 billion. And the numbers will only continue to rise, given that quantum technology is now considered critical infrastructure and the military is showing increasing interest.

Besides the public funding, there has been an increase in the amount of private capital flowing into the field for some time now, with the number of venture capital deals in the quantum technology space recently rising to an all-time high. More and more private investors evidently anticipate the chance to earn good money with quantum applications in the not too distant future.

Companies should therefore keep a close eye on developments and would do well to start scenario planning to model the impacts that the move to qubits could have on them in the future. Because even though there is a great deal of uncertainty around the when and the how of quantum technology, there's no doubt that only those who address the subject early on and simulate the possible implications for their own business model, corporate processes or supply chains will be able to react fast when the time comes.

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