Creating Digital Businesses: Disrupting Industries
Creating Digital Businesses: Disrupting Industries
<p>Merely digitizing a business is not enough to survive disruption. It takes the creation of a digital business to redefine the product, delivery, value, and consumer. While conventional companies are digitizing to become more efficient, young entrepreneurs are recreating familiar businesses in digital forms and overwhelming the established players. The digital natives are disrupting the supply chain and value creation and are taking away the market by offering unprecedented convenience, economy, and speed to consumers. The legacy businesses need to imbibe the spirit of the new generation to have a future.</p><p>Technology has disrupted every industry and has opened up vast avenues of possibilities to explore and grow exponentially. Historically there have been several disruptions that the world has seen, every decade there as seen game-changing disruptions. A simple thing like listening to music has changed over the last three decades. While I was school going boy, we had a common tape recorder/radio / two in one player at home. When I was in college I had my own walkman / CD player and by the time I started working I had an I-pod. Today, music is just an app on your phone. At every level of game change — the consumer gets an enriching experience and convenience.</p><p>Any organization that took advantage of technology or digital capabilities to bring about a fundamental change in their respective markets are the digital disruptions. Several examples we know Oyo who are the distributors in the mid / economy hotels or the Redbus which has disrupted the bus ticket booking. Likewise we have Airbnb who has weeded out the need to invest in real estate, Netflix in OTT weeded out Satellite TV, Uber/Ola changed car rentals booking, Portea or 1mg in healthcare, Amazon/Flipkart in e-commerce, PayTM in payments, are the game changers in B2C space. B2B also had witnessed disruptions. Use of technologies like Artificial Intelligence BlockChain, IoT, Augmented Reality has enabled players to completely change logistics and supply chain operations which is the backbone of any industry.</p><p>All these disruptions have certain things in common. Firstly, they have offered convenience to a consumer. Secondly, they imbibe values of new-age customers, for example, new generation has low attention span, they need entertainment or gaming kind of experience each time which is why Tik Tok is popular among them. Anyone can get glued to it easily, and once you are there, you are there forever. Lastly, every simple-looking app has a strong back end to be integrated — the majority of that work is offline and also they are interconnected involving a large number of dependencies. For example, in the case of Redbus — all bus operators need to be on-boarded on a common platform who would share their routes, buses, seats, etc. Both systems are integrated using technology and when any user searches a particular destination — the algorithm takes care of the rest.</p><p>Digitization has enabled these disruptors to get the</p><p>1. Scale: no of customers, acquisition speed, reduced cost of acquisition</p><p>2. Reach: penetrate new markets, open segments, reduce conversion cycle</p><p>3. Give customers the richness and experience, compared to any traditional business</p><p>Organizations that ignore potential industry changing technologies run a risk of falling behind or being completely eliminated from the race. Kodak being a world famous case. Your competitor can be anybody down the next road to your office. They can emerge from anywhere and hence to compete today traditional companies must change their perspectives and start welcoming changes. One should think from customer, employee, stakeholders' perspectives how they can enrich their experiences using available or new technology. One should use data and business intelligence tools to understand and then take decisions, update operating processes and ways of working. Lastly, there should be a cultural change and its alignment to your business goals.</p><p>A study conducted by Harvard Business Review with midsize/large global organizations has found that the companies who have removed manual processes, added automation and improved workflows through the use of apps such technologies have:</p><ol><li>Increased sales performance</li><li>Increased employee productivity</li><li>Reduced costs and improved operational efficiency</li><li>An enhanced customer experience</li><li>Market differentiation</li></ol><p>These disruptions have presented us with new avenues for companies or individuals to grow and excel. Had there not been Ola/Uber millions of people who have got stable jobs would have been jobless; Had not there been an Oyo thousands of economy rooms/hotels would be running vacant</p>
KR Expert - Vidyadhar Prabhudesai
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