Mainspring Insights: Digital Business
Every industry no matter how conventional including medical, education, and agriculture will be forced to adapt their business to the digital world in order to survive. The twenty first century is experiencing a digital revolution, relying on a world based on automation & computerization. This revolution is allowing opportunity for businesses to make millions off new technological business strategies.
According to Gartner, “By 2020, more than 7 billion people and businesses, and at least 35 billion devices, will be connected to the Internet. With people, businesses and things communicating, transacting and even negotiating with one another, a new world comes into being".
This digital revolution has made products and services that once required labor and money, available to customers instantaneously. Thousands of businesses across the world go bankrupt after being taken over by the competitive and ever-changing digital world. These short-term businesses fail because their CEO’s find it hard to adapt to converting their business digitally. Long-term businesses become successful because their CEO’s completely embrace the restructuring of their company to the digital realm.
The process of a business going digital is a complicated, calculated, and risky gamble. There are many challenges and obstacles a company will face in the transition to becoming digital. Internal managerial accountants will project the pros and cons from a financial standpoint. Basic challenges that a company may face converting to a digital business would be investments, firing employees, B2B transactions, and developing ecosystems. Looking from an outside point of view determining what step you are in the Digital Business Development path is a key start.
Depending on what stage you are in this path will reflect some of the challenges a business will have to overcome. Businesses in the Analog stage will have to develop a system where they can make a profit from customers, and how moving to a more advanced approach will build off current success.
CIO’s should be careful of threatening government regulations that are in place. Businesses in the Web stage will have to take a step-by-step approach because the new culture could be a shock to the employees. Going digital could put an extreme amount of pressure on the employees learning the new systems. They should take a gradual procedure starting with an e-business, incorporating digital marketing, then finally switching over to digital business.
This will help prevent employee security flaws protecting employees personal information. An E-business looking to go digital will have to be aware that a three to five year time lapse may occur before being digital. During this time gap further investments may have to be made to sustain a revenue stream. Additional investments will have to be made to teach the employees how to use the new equipment and how to incorporate it into their business, during and after the digital stage.