Flevy Management Insights Q&A
What emerging AR applications are poised to disrupt traditional business models in the next decade?
     David Tang    |    Augmented Reality


This article provides a detailed response to: What emerging AR applications are poised to disrupt traditional business models in the next decade? For a comprehensive understanding of Augmented Reality, we also include relevant case studies for further reading and links to Augmented Reality best practice resources.

TLDR Emerging AR applications are set to revolutionize Retail and E-Commerce, Manufacturing and Supply Chain, and Healthcare by improving customer experiences, operational efficiency, and patient care.

Reading time: 5 minutes

Before we begin, let's review some important management concepts, as they related to this question.

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Augmented Reality (AR) technology is rapidly evolving, creating new opportunities for organizations to innovate and disrupt traditional business models. As we look towards the next decade, several emerging AR applications stand out for their potential to transform industries, enhance customer experiences, and streamline operations. This exploration will delve into specific areas where AR is poised to make significant impacts, supported by insights from leading consulting and market research firms.

Retail and E-Commerce Transformation

The retail and e-commerce sectors are at the forefront of adopting AR technologies, aiming to bridge the gap between online and physical shopping experiences. AR enables customers to visualize products in their own environment before making a purchase, thereby reducing uncertainty and improving satisfaction. For instance, IKEA's AR app, IKEA Place, allows users to see how furniture would look in their homes, supporting decision-making processes. According to a report by Gartner, AR is expected to become a critical technology for e-commerce, with organizations increasingly investing in AR to enhance customer engagement and reduce return rates. This shift not only has the potential to increase sales but also to revolutionize customer service and support.

Moreover, AR is enabling personalized shopping experiences. By leveraging AR for virtual try-ons, customers can see how clothes, glasses, or makeup products look on them, which significantly enhances the online shopping experience. Sephora's Virtual Artist app and Warby Parker's virtual try-on are prime examples of how AR can be used to personalize the shopping journey. These innovations not only drive sales but also foster brand loyalty and customer retention.

Furthermore, AR is transforming in-store experiences. Through AR-enabled apps, customers can receive product information, reviews, and even navigate stores more efficiently. This integration of digital and physical retail experiences is expected to redefine the retail landscape, making shopping more interactive, informative, and engaging. As organizations continue to explore AR's potential, the retail sector is set to witness a significant shift towards an omnichannel approach that seamlessly blends online and offline worlds.

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Manufacturing and Supply Chain Optimization

In the realm of manufacturing and supply chain management, AR is emerging as a powerful tool for enhancing operational efficiency and reducing errors. AR can provide workers with real-time information and guidance during the assembly process, minimizing the risk of mistakes and improving productivity. For example, Boeing has implemented AR to assist technicians in airplane wiring installations, which has resulted in a significant reduction in production time and error rates. This application of AR not only streamlines the manufacturing process but also contributes to Operational Excellence.

AR also plays a crucial role in maintenance and training. By overlaying digital information onto physical equipment, AR can guide technicians through complex repair procedures or provide training simulations. This not only reduces downtime but also enhances the skill set of the workforce. Companies like Siemens have leveraged AR for maintenance and training purposes, showcasing the technology's potential to transform traditional practices.

Furthermore, AR can improve logistics and inventory management. By visualizing warehouse layouts and tracking inventory through AR glasses, organizations can optimize storage spaces and streamline picking processes. DHL, for example, has experimented with AR glasses to guide workers through warehouses, resulting in improved efficiency and accuracy. As supply chains become more complex, AR offers a promising solution to enhance visibility, accuracy, and efficiency across operations.

Healthcare Innovation

The healthcare sector stands to benefit significantly from AR technology through enhanced patient care, medical training, and surgical precision. AR can provide surgeons with real-time, 3D visualizations of patient anatomy during procedures, improving outcomes and reducing risks. Companies like AccuVein are using AR to visualize veins, making blood draws and IV insertions easier and less painful for patients. This application of AR not only improves patient experiences but also exemplifies how technology can support critical healthcare processes.

In terms of medical training, AR offers immersive simulations that allow medical professionals to practice procedures in a risk-free environment. This hands-on approach to learning can enhance understanding and retention, preparing healthcare providers more effectively for real-life scenarios. Organizations like Osso VR are leading the way in medical and surgical training through immersive AR experiences, highlighting the technology's potential to revolutionize medical education.

Moreover, AR can support patient care beyond the hospital setting. Through AR applications, patients can receive guidance on medication management, physical therapy exercises, or even chronic disease management at home. This not only improves access to healthcare services but also empowers patients to take an active role in their health management. As AR technology continues to evolve, its applications in healthcare are expected to expand, offering new ways to improve outcomes, efficiency, and patient experiences.

As organizations across various sectors explore the potential of AR, it's clear that this technology is poised to disrupt traditional business models significantly. From transforming retail and e-commerce to optimizing manufacturing processes and revolutionizing healthcare, AR offers a myriad of opportunities for innovation and growth. By staying ahead of these trends, organizations can leverage AR to create competitive advantages, enhance customer experiences, and drive operational efficiencies in the next decade.

Best Practices in Augmented Reality

Here are best practices relevant to Augmented Reality from the Flevy Marketplace. View all our Augmented Reality materials here.

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Augmented Reality Case Studies

For a practical understanding of Augmented Reality, take a look at these case studies.

Augmented Reality Integration for Aerospace Maintenance

Scenario: The organization is a leading aerospace company facing difficulties in maintaining high operational standards due to complex machinery and a global workforce.

Read Full Case Study

Augmented Reality Deployment in Construction

Scenario: A mid-sized construction firm specializing in large-scale commercial projects is facing challenges integrating Augmented Reality (AR) into their workflow to enhance precision and efficiency.

Read Full Case Study

Augmented Reality Deployment for Industrial Equipment Manufacturer

Scenario: The organization is a leading industrial equipment manufacturer seeking to incorporate Augmented Reality (AR) into their assembly and maintenance processes.

Read Full Case Study

Healthcare Provider Innovates Patient Engagement and Training with Augmented Reality

Scenario: A mid-size healthcare provider implemented an Augmented Reality strategy framework to address its patient engagement and training challenges.

Read Full Case Study


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Related Questions

Here are our additional questions you may be interested in.

What metrics should executives use to measure the ROI of AR initiatives in their organizations?
Executives should measure the ROI of AR initiatives through metrics like Revenue Enhancement, Cost Reduction, Customer Engagement (CSAT, NPS), Operational Efficiency, and Employee Performance, to inform Strategic Decisions and foster Innovation. [Read full explanation]
How can companies ensure data privacy and security when implementing AR technologies?
Companies can ensure data privacy and security in AR technologies through Strategic Planning, Risk Management, implementing a robust data privacy framework, advanced security measures, and enhancing user awareness and control. [Read full explanation]
What are the key challenges in scaling AR solutions across different departments within an organization?
Scaling AR solutions involves overcoming Technological Integration challenges, executing effective Change Management, and ensuring Scalability and Performance Management to drive innovation and efficiency. [Read full explanation]
What role does AR play in enhancing the interconnectivity and automation of smart factories?
Augmented Reality (AR) is revolutionizing Smart Factories by improving Interconnectivity and Automation, offering real-time data, enhancing operational efficiency, and integrating with automated systems for better productivity and quality. [Read full explanation]
How are AI and machine learning being integrated with AR for smarter, more adaptive applications?
Integrating AI and ML with AR is transforming industries by revolutionizing customer engagement, operational efficiency, and driving Innovation, offering significant Strategic and competitive implications for organizations. [Read full explanation]
What are the implications of 5G technology on the deployment and effectiveness of AR applications?
5G technology significantly enhances AR applications by providing faster speeds, lower latency, and increased capacity, enabling real-time, immersive experiences and supporting a vast number of connected devices for Strategic Planning and Innovation. [Read full explanation]

 
David Tang, New York

Strategy & Operations, Digital Transformation, Management Consulting

This Q&A article was reviewed by David Tang. David is the CEO and Founder of Flevy. Prior to Flevy, David worked as a management consultant for 8 years, where he served clients in North America, EMEA, and APAC. He graduated from Cornell with a BS in Electrical Engineering and MEng in Management.

To cite this article, please use:

Source: "What emerging AR applications are poised to disrupt traditional business models in the next decade?," Flevy Management Insights, David Tang, 2024




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