The Pros And Cons Of Digitalization

Introduction

In the recent past a new technological frontier has been ushered through digitalisation. The fast pace of digitalisation is reshaping relationships between brands, consumers and technology. The forces of digitalisation are upending business models and fast reshaping markets. Never in history has the disruptive powers of digitalization been so discernable as now. In technology, the adage goes “you are as successful as your last innovation”. Before the incumbent firms could realize, new innovations had taken the market by storm. ICT (Internet, Communications, and Technology), IOT (Internet of Things), B2B, (Business to Business), android, have become technological waves and the new bywords. Economies around the world are seeing

Some leading examples are IBM, Microsoft, Apple, Google, Amazon and Facebook. There is enough empirical evidence to suggest that these disruptive firms have defeated their counterparts. For instance, in social media Orkut perished with the advent of Facebook and so has been the experience in other sectors. Technological complexities give disruptions to older firms. In the mobile industry smart phones have disrupted feature phones and to a greater extent laptops. Disruptive firms succeed for two reasons. They initially capture the unknown terrain of new consumers which the traditional firms have ignored, thereby creating a newer breed of consumers. Through technological advancement they create a product which is of lower cost, and making it more accessible to newer consumers. This disruptive innovation hence leads to the transformation of a costlier product into something cheaper and widely accessible (Christensen Clayton 1997). With passage of time they chew into the market share of traditional firms. The disruptor firms become the new benchmark and rule the market, till they themselves are ousted by another technological leap, if they have not caught

The greater proliferation is taken as a surprise by incumbent firms, and it is at this point that they start re-strategizing and reshaping. However, by then it is too little and too late. A large number of companies despite being aware of their disruptive counterparts are negligent and are not proactive in disrupting themselves to meet the challenges from disruptive technologies (Global Centre for Digital Business Transformation). This places the business at a significant risk and these firms are victimized by disruption. It must be noted that disruptive technologies are not typical to the IT industry alone. They have their presence in other sectors. Some typical examples are Pay pal, smart watches, medical test apps, and the entire ecommerce sector challenging the brick and mortar