Don't miss the train to digital development
Joshua Klein speaks at the #TulevaisuudenAvajaiset (Future Opening) event held at Kunsthalle Helsinki.
Companies are quickly converting their business processes to become digitally compatible, and the increasing speed of technological development will only accelerate the digital evolution. Those companies that are incapable of keeping up with this development risk falling behind the competition.
According to the American technologist and author Joshua Klein, many digital solutions that were out of reach of most companies at the start of the millennium are now an integral part of their day-to-day business operations. For instance, today a website is today a rule rather than an exception, no matter the size of the business.
However, Klein thinks the rate of speed at which new technologies are being developed is too much for some companies. They are not able to adjust their business processes to take advantage of the constant development of digital solutions, even if their decision makers genuinely wish to do so.
"Many companies are finding it difficult to adjust their bureaucratic processes quickly enough in order to be flexible and stay at the top of the competition," Klein says.
Affordable technologies to the rescue
Klein thinks those companies that are eager to adopt new digital solutions to increase business performance, develop their business processes and invest heavily in research and development will become future market leaders.
The on-going digital revolution will inevitably affect all sectors of the business world in one way or another. One reason for this is the high speed of digital development which has lowered the prices of many digital technologies available to companies. Building a website, for instance, costs only a fraction of what was the standard asking price in the early 2000s.
Klein points out that "it is nearly impossible to imagine a company trying to survive in today's competitive environment without a website to support their business."
Increasingly affordable technologies will also increase competition in the IT sector: business ideas that used to be unattainable can now be realized by innovative people thanks to technologies that are finally within reach. Companies are also feeling the pressure and increased competition due to the exploding growth of startup entrepreneurs. In 2013, the United States alone saw the launch of 1,500 new startup businesses that were funded by venture capitalists. The number of IPOs has increased by 65 per cent compared to 2012 figures.
New challenges in the age of the empowered customer
While Klein thinks no sector is completely immune to digital development, he says politics and the finance sector have yet to benefit – and change – most from new technologies.
"There are so many new powerful technologies available that commerce will no doubt change, and with it the development will also bring changes to supporting sectors, such as finance. Those changes will significantly shape our current view of these services."
So what challenges does Klein see for companies due to the fast development of technology?
"Mobile applications, for one. They shape consumer behaviour and increase their sense of authority in making purchase decisions. RetailMeNot and CouponsAtCheckout are examples of apps that even today offer consumers the ability to search for the products they want at the best price."
Indeed, the advertising budget is not the only channel to shape consumers' purchase decisions. Consumer behaviour is increasingly influenced by alternative information channels that traditional advertising cannot touch – social media, product review sites and blogs.
Klein recommends a large dose of bravery for business leaders so that their companies can keep their position in the market and increase opportunities.
"Companies should always aim to seize new opportunities and embrace technologies that support their business. Wilfully ignoring digital development increases the risk of a company's business model becoming outdated and obsolete compared to its competitors."