The business of quantum technologies and the future of productivity

Chander Velu, Professor of Innovation and Economics at the University of Cambridge and a Co-Investigator at The Productivity Institute has co-authored an open access book (with Keith Norman, Yuzhen Zhu, Fathiro Putra and Chris Noble) examining quantum technologies as they move from research into commercial reality. In this blog, Chander discusses this new book, The Business of Quantum Technologies: From Theory to Innovation Strategy.

Quantum technologies harness the physics of sub-atomic particles to achieve what would otherwise be impossible. Microprocessors in our computers and MRI scanners already rely on quantum physics. However, newer quantum technologies are creating capabilities in a wide range of applications like computing and communications by manipulating unexploited quantum phenomena.

A new open-access book explains how organisations might adopt quantum computing, communications, sensing, imaging and timing technologies. It examines applications in healthcare, financial security, climate monitoring, and transport among others.

Why is the adoption of quantum technologies important for productivity?

There is ample evidence of slowdown in productivity growth rates following the emergence of radically new technologies. Historically, productivity slowdowns have been evident during the adoption of general-purpose technologies, such as electric motors and digital computers, that are meant to improve efficiency.

Economists have provided various explanations for this productivity paradox, mostly focusing on past technological adoption or current challenges in firms adopting digital technologies to improve performance.

Although insightful, these studies observe the facts largely only after they have occurred or when the technology is already relatively mature, potentially not fully capturing the strategic decision-making process of firms and policymakers during the earlier stages of technological adoption.

One of the major gaps in our understanding is how firms and policymakers should prepare to adopt technologies that are only now emerging from science and engineering research, but may not be deployed until years in the future. Therefore, examining innovation related to quantum technologies as the technology matures is important to help accelerate productivity growth and benefit society.

What benefits to society are likely to come from quantum technologies?

Despite the prevalence of digital and related technologies, many societal problems remain difficult to address. For example, the complexity of understanding atomic interactions and molecular structures makes it challenging to develop new materials to combat climate change or to develop personalised medicine to treat rare diseases.

There is an increasing risk to information security because of the threat of breaking encryption protocols. More precise sensing and imaging methods are required for detecting objects below ground level for civil engineering applications or detecting gas leaks in dangerous environments. Moreover, the vulnerability of the global satellite systems calls for more secure and accurate local timing systems. These societal challenges might require quantum technologies to address them.

Quantum technology is a general-purpose technology that has many applications and could benefit society in various ways:

• Quantum computing enables faster computation to address challenges such as climate resilience, financial stability, new drug and materials discovery.
• Quantum communications provide the basis for more secure communications and protection of sensitive data.
• Quantum sensing allows for better detection of faults in hard-to-reach infrastructure below ground level such as gas pipelines or improved navigation of autonomous vehicles.
• Quantum imaging provides the basis for more precise health care applications such as brain imaging.
• Finally, quantum clocks would enable more accurate timing for optimising and providing resilience to critical national infrastructure such as transport, financial services and energy systems.

Why should established business models adapt to integrate quantum technologies and capture their value?

A business model is a complex organisational system that transforms inputs into outputs in terms of valuable propositions for customers. They often act as the arc that connects technology with the ability to deliver a compelling customer value proposition.

As quantum technologies create new forms of value, new business models need to emerge to translate these technologies into societal benefits whilst also providing profitable business opportunities for firms. New business models could emerge from a combination of incumbent firms or new entrants, which need to be supported by changing institutions and industrial systems.

We need to encourage researchers across business, economics and management to collectively work with scientists and engineers to improve innovation and technology management of quantum technologies, enabling the benefits to be realised in the near future. Hence we believe it is imperative to conduct the research in “living labs”, where managers and researchers are experimenting with quantum technologies and learning to innovate products, services and the associate business models.

Why is it important to think about responsible innovation in the context of quantum technologies?

There has been significant global investment in developing quantum technologies to benefit society. The UK government has invested over £1 billon in the UK National Quantum Technologies Programme (NQTP) and has emphasised quantum technologies as a key driver for economic growth as part of its modern industrial strategy. Global investment reached $33 billion in 2025 and could potentially generate close to $100 billion in revenue by 2035.

However, despite those large investments, adopting quantum technologies could result in a reduction in productivity growth before the economic benefits accrue fully because of the “steep learning curve” that industries might face adapting to the technology and developing new business models.

The benefits of quantum technologies also need to reach all parts of society in a responsible way. Many countries are considering the wider moral and ethical questions around developing quantum technologies. Quantum technologies are likely to have long-lasting impacts on society and it is important to have a considered and ethical approach to researching and developing these technologies that looks at any potential social issues.

To ease the learning curve and ensure that the benefits of quantum technologies are shared fairly across society, we need to better understand the barriers and enablers to building an appropriate business ecosystem in order to scale up the technology and spur economic growth. We need to continue to foreground equitable access to quantum technologies-based resources, infrastructure and talent to advance global collaboration. The time is ripe for scholars, managers and policymakers to work together to enable quantum technologies to address grand societal challenges, while contributing to productivity and economic growth in a responsible and sustainable manner.

Who will benefit from the book?

This book provides the foundational conceptual knowledge in a field that is rapidly evolving. It describes the evolution of quantum technologies that are likely to have significant economic, business and geopolitical implications.

Although we provide a background to the science, we have attempted to write the book with minimal technical terms from quantum mechanics to provide an intuitive explanation to non-specialists.

The book highlights the major areas of research in the business application of quantum technologies. It emphasises areas for future research, provides frameworks to better understand how to adopt and integrate quantum technologies in organisations, and outlines the policy issues with respect to quantum technologies.

We believe the book will provide the intellectual foundations for scholars, managers and policymakers to work together to enable quantum technologies to address grand societal challenges.

The book is available on Springer Nature.