Summary: Digital Business & Transformation

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• 1 Week 1 : Article digital transformation

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• digital transformation is multidisciplinary in nature

  
  because it involves changes in
  strategy organization, information technology, supply chains and marketing.

• External Drivers of Digital Transformation

  • Digital technology
    
  • Digital competition
  • Digital customer behavior

• Phases of Digital Transformation

  • Digitization
    
  • Digitalization
  • Digital transformation

• Strategic Imperatives of Digital Transformation

  • Digital resources
    
  • Organizational structure
  • Growth strategy
  • Metrics and goals

• There are three major external factors driving the need for digital transformation:

  • Digital technology
    
  • Digital competition
    
  • Digital customer behaviour
    

• Digital customer behaviour

  
  

  • Consumers are shifting their purchases to online stores
  • Consumer behavior is changing as a response to the digital revolution
  • When firms cannot adapt to the digital changes, they become less attractive to customers → likely to be replaced by firms that do leverage such digital technologies.

• What are the 4 digital assets and capabilities for digital change?

  1. Digital assets
     
  2. Digital agility
  3. Digital networking capability
  4. Big data analytic capability

• Digital networking capability

  
  The digital networking capability, which refers to the firm’s ability to bring together and link distinct users to address their mutual needs via digital means, becomes more important in digital settings.

• Digital functional areas

  • The employees’ digital skills in marketing and service operations also need to be upgraded to enhance value creation.

  • An important feature of digital transformation is the increased reliance on IT and analytical functions

• There are two key drivers behind the impressive growth of platform’s: high scalability andreinforcing network effects.

  • Platforms can grow rapidly and handle a growing number of users, including customers, suppliers and ancillary service providers, because the cost of serving additional users is low and, in the case of digital platforms, sometimes even negligible

  • Next, the platform model implies that a growth in the number of users on one side (e.g., customers or suppliers) attracts users from the other side, as they receive higher utility from using the platform, due to increasing network effects (!!!) that create virtuous loops