Since the recession and financial crisis that ended in 2009 business leaders and executives are facing a transforming global business environment according to an economics researched paper. The world economy is now characterised by slow growth in the west, increasing power in the east, and value-driven customers with rising risks everywhere. The economic downturn has speeded up the adoption of key technologies like mobility, cloud computing, business intelligence and social media that are transforming businesses and stirring up a new wave of wealth creation especially in the emerging economies.
Technology and economic growth are inextricably related. Whilst the advanced economies are seeking new ways to cut costs and drive innovation, emerging economies are shaping up their demand for technology to fuel growth in the wake of current economic climate that is demanding investment in technology. A virtuous circle emerges as increased economic growth, especially in emerging economies, results from digital technologies driving consumer income and demand, education and training and efficient use of capital and resources.
As market momentum accelerates, business leaders and executives must be aware of new challenges facing their organisations. The paper mentioned six significant changes that organisation will need to address in the next five years as follows:
1. The global digital economy comes of age. Mobility, cloud computing, business intelligence and social media are changing the marketplace through the use of internet technology setting in motion a third wave of capitalism from consumer behaviour to new business models in both advanced and emerging economies.
2. Industries undergo digital transformation. Organisations across a range of industries have seen their businesses models toppled as they deal with the double forces of technology and globalisation as a result of a maturing digital economy. Many sectors including technology, telecommunication, entertainment, media, banking, retail and healthcare will continue to be reformed through the use of information technology in the next five years.
3. The digital divide reverses. As economic power changes to the East, companies in the developing economies are investing heavily in technology. This presents a new competitive challenge – aggressive technology-charged firms from emerging economies to business leaders and executives in advanced economies.
4. The emerging-market customer takes center stage. Rising populations and income levels, together with rapid economic growth are putting emerging economies at the center of corporate growth strategies. Huge opportunities exist for organisations that adapt to the needs of customers in emerging economies – including consumers, business and government sectors.
5. Business shifts into hyperdrive. Fast-growth economies and new technology that had been fuelled by ever-changing global marketplace has accelerated the momentum of most business activities. From product development to customer response, real-time business intelligence and predictive analysis will be required for quicker decision making and to handle unexpected market risks and opportunities.
6. Firms reorganise to embrace the digital economy. Organisations are moving away from a hierarchical decision making to a networked structure that is more market like and organic to operate on the global digital playing field where new rivals are unencumbered by rigid policies and thinking.
These changes will have thoughtful consequences for organisation in the years ahead. The paper highlighted a number of imperatives business leaders. A forward-looking mobile strategy for emerging markets where the phone is the primary means for internet access is advised. A consideration of improving data analysis to anticipate rapid global market changes is not over looked. And also remembering that in a fast-moving world, the threat of security breaches rises necessitating the building of stronger safeguards into operations. Finally, protecting market share in their home countries for organisations in emerging economies as markets grows rapidly – rivals may be looking over your shoulder.