As per Gartner, Digital business could be defined as “the creation of new business designs by blurring the digital and physical worlds”. The adoption of Digital Business, which is a precursor to Business Analytics, is not a new phenomenon relatively, as companies have been adopting a simpler and more rudimentary version of the Digital Business that we know today. Today we are going to describe in detail, the various stages of Digital Business adoption. This could be used by the Executives and CXOs of companies to assess their standing in the Digital Conversion of their business and find out how much ground is left to cover.
Most of the companies have been calling themselves Digital, but most have yet to transcend to being purely digital businesses but are instead left to being an e-business or a digital marketing business. 41% of businesses have their primary focus on digital marketing. This state of illusion could lead to competitors seriously hurting them.
Digital Business primarily brings a convergence of people, business and things, which attains ability to disrupts existing business models. The perception of an Innovative business painted by Digital has been defined as the interaction of people, business and things. The disruptive business would the one which can successfully come up with an efficient way for these three entities to interact with each other to create value. The following figure depicts the individual rendition of various companies of how they define being part of Digital.
The CIOs can now see that, for example, even if they are a very successful e-business, their model is susceptible of becoming irrelevant in the near future because of a new entrant leveraging Digital Business Capabilities. For many industries, the competitive landscape is turbulent, with new entrants pouring in constantly, while making the incumbents to review their business model.
The Digital Business Life Cycle can be perceive to contain six stages of digital evolution. The characteristics of the same is described in the figure below:
This figure will help CIOs make the case for digital business investments. The characteristics are divided into five attributes:
Let’s look at the various stages in a bit more detail:
This stage of development was at the height of business before Internet came into being. The primary targets were to improving revenue or reducing costs. Internet only acted as a medium of communication between suppliers, customers and businesses. Technologies like mobile, social or e-commerce where the business disrupters of these times.
In this stage, the business had a good presence on the Internet which was mostly used for basic level promotions of making people familiar with the name and its workings. The attributes of this level of business are:
In this stage, the goals of the analog business achieve scalable performance when combined with the reach of the Internet. For many businesses, e-business led to a great success. For others, they would sustain until a business armed with digital business strategies invades their space. The key to e-business is not only to focus on business relationship, but also business integration. It uses internet to leverage its reach across to the mass, something which business had trouble of achieving. An e-business exploits the reach, availability and ubiquity of the Internet and was able to connect customers and businesses together.
Consumers have declared their mobile devices and social networks as preferred doorways to companies. By the advent of Digital Business, there was a clear increase in the priority businesses gave to customer expectations. Customers exercise a huge influence on brands, markets, products and even pricing. The biggest challenge for the CMOs is to leverage the ever-changing customer expectations to grow the company. Digital marketing transforms the relationship a company has with its customers, building on a preferred technology platform. The adoption of Digital Marketing has led to a more closer connect with the customers, their needs, preferences and aspirations. This also follows the increase in the influencing power of customers due to availability of many players and the power to choose a vendor or to migrate to another.
Digital business promises to bring in an unprecedented convergence of people, business and things which has the potential, and which does to this day, disrupt existing business models — even those born in the era of Internet and e-business.
Some of the attributes of digital business are:
Digital business represents another big change in trend, with the entry of Internet of Things, which creates a completely different interworking.
The final frontier for the Digital Business, subsequent to continuous improvement in the intelligence of things would be a Business where primary entities work, interact, negotiate and decide with zero human intervention. This has the potential to influence deeply, the lives of people, and the quality of life itself. Technologies like Autonomous vehicles are already into prototype stage which, when perfected, would lead to a breakthrough in industries and practices like transportation, mining and defense. In addition to the self-managing aspects of these things, there will be an immense improvement in the quality of output due to real-time interaction and decisive performance by these Autonomous Systems. They would further open doors to advanced Artificial Intelligence systems which could self-heal and evolve independently.
This Life Cycle is designed to help companies have a precise understanding of their current stage of digital business transformation, and then to identify the way forward with the support of top level management and board of directors, given the complexities of integrating with the world of digital business.
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