Disruptive Technologies and Their Impact on Business Models

Posted on May 19, 2024 in Other subjects

Lesson 5: Disruptive Technologies

A) Blockchain

Blockchain is a public and distributed registry shared among all participants in a peer-to-peer network. Each block is linked to the previous one, making it impossible to edit one block without editing the following one, thus having no single point of failure.

a) Structural Features:

  • Distributed ledger
  • Consensus
  • Cryptography
  • Flexibility

b) Two Kinds of Blockchain:

  1. Permissionless or public blockchain
  2. Permissioned (public or private) blockchain

c) Blockchain Components:

  • Smart contracts
  • Tokens items (fungible and non-fungible)

d) Digital Identity Evolution:

  1. Centralized identity
  2. Federated identity
  3. Self-sovereign identity (SSI): A digital identity approach that gives people control over their digital identities. Advantages of SSI: data sovereignty, privacy, openness, cost reduction, efficiency in data exchange, network.

B) Artificial Intelligence and Robotics

a) Artificial Intelligence:

A field of science primarily concerned with getting computers to do tasks that would normally require human intelligence.

b) Machine Learning:

A set of algorithms that allows computers to learn from data without being explicitly programmed.

c) Deep Learning:

Detects patterns by using artificial neural networks that contain multiple layers.

d) Robotics/Automation:

A discipline in engineering that studies and develops methods that allow an automated machine to perform specific tasks, reproducing human work.

C) Internet of Things and Industry 4.0

The Internet of Things (IoT) is a network of physical objects containing embedded technologies to communicate and sense or interact with their initial states or the external environment. It has the potential to transform operations and business models and is driven by AAA (anytime, anywhere, any device).

D) Big Data

Big data refers to a large and complex amount of data that requires specific technologies to be managed across the following phases: collection, storage, processing, and visualization.

E) Immersive Technologies

Immersive technologies integrate virtual content with the physical environment in a way that allows the user to engage naturally with the blended reality (augmented reality, virtual reality, mixed reality).

Lesson 6: The Effects of COVID-19 on Megatrends

The advent of COVID-19 has modified and, in some cases, disrupted megatrends, causing sudden acceleration or braking in the sectors involved. Four macro-areas and their respective megatrends have been identified as the most impacted:

  1. Demographics
  2. Digital trends
  3. Globalization
  4. Environment

Many business sectors will have to face various factors:

  1. Evolution of consumption habits
  2. Regulatory/organizational frameworks
  3. Geopolitical phenomena
  4. Epidemiological health management skills

A) How Will COVID-19 Change Business Models?

To capitalize on the opportunity for digitalization, firms need to be agile and rapidly develop dynamic capabilities related to specific strategic and organizational processes:

  1. Reduction of efforts in core business and expansion towards new horizons
  2. Review of the customer experience
  3. Adoption of new go-to-market channels
  4. Re-thinking of the product portfolio
  5. Review of the operating models

B) The Digital Transformation’s Impact on Business Models

Digital disruption will be analyzed according to its impact on five fundamental areas of business:

  1. Offering
  2. Go-to-market
  3. Operating model
  4. Talent
  5. Innovation

C) Offering

Digitalization has broadened and redefined not only the range of products/services but also the “components” supporting their use. It has also significantly influenced the price of products. Companies with an offering focused on digital products/services generally adopt a “free” pattern business model. To respond to consumer needs, companies continuously adapt their offer by improving existing products/services or introducing new products/services embedding new technologies according to four macro-directions:

  1. Product accessibility
  2. Usability
  3. Ultra-custom product
  4. Additional services

From product purchase to pay-per-use: For improved flexibility, it is better to “hire” an asset rather than buying it. Some players have a business model based on facilitating user access to the products/services they need.

D) Hybrid Business Models

The number of market players with a business model based on digital content aggregation is increasing: the over-the-top. The profitability of the business has attracted other players in the supply chain, including those at the bottom.

E) Product Tailoring (Industry 4.0 vs. Tailoring)

Industry 4.0 is the answer to the flexibility demanded by many customers today.

Lesson 7: Target

A) Target Market Analysis

1) The Description and Outlook of the Industry

Start with a description of your company’s industry. Must include:

  • Industry, category, and characteristics
  • Trends, best practices, lessons learned

2) Your Target Market

Specify how you have narrowed your target market down to a more workable size. Must include:

  • Customer segments
  • Customer buying habits and interests
  • Market size
  • Focus on your value

3) Competitive Analysis

Identify your competitors and their target markets. Must include:

  • Direct competitors
  • Competition dynamics
  • Status quo and entry barriers
  • The uniqueness of your product/service

4) Regulatory Restrictions and Barriers

Identify any barriers to entering the market and note any regulatory restrictions that might affect your business.

B) Go-to-Market

a) New Sales Channel

The digital revolution has pushed retailers and sellers to use digital channels to commercialize products. Online selling reaches a greater number of customers and allows companies to know their clients better.

b) Targeted Offering

The feedback and data that companies gather allow them to understand their clients, identify their needs, and improve the offer within a continuous improvement process.

c) How the Channels Evolved with Digital Innovation

Continuous innovations generate new operating models for traditional offline channels and increase the importance of online channels. Companies reach consumers through different channels (omnichannel approach), generating more and more information (big data). Many retailers and e-tailers are taking measures to offer their customers a truly personalized, dynamic, and valuable experience using advanced analytics from new data management brought about by technologies that allow recording, tracking, and tracing routes, choices, and buying behavior.

C) Operating Model

The operating model describes how a company organizes and manages resources to create value for its clients. In some cases, the components of the operating model are organized according to the different steps of the value chain (e.g., production, distribution…).

a) Transformation of the Operating Model

  1. Rent not own/shared services: Leasing, shared services, not owning.
  2. Service-driven model: Products with innovative features linked to the service component force companies to build complex networks that allow the integration of technologies into new services.
  3. Marketplace: Connecting demand and offer (client-focused, technology-driven, operationally flexible).
  4. Knowledge of the client + optimization of the value chain.
  5. Hub & spoke: The hub and spoke model represents a rationalization of the production system with the concentration of complex activities in the hub and the use of branches for flexibility/customization.

D) How Industry 4.0 Is Going to Change Operating Models

Industry 4.0 places the factory at the center of a self-adaptive ecosystem connected internally and with the outside world, leveraging digital technologies and using systems for managing and analyzing a massive amount of data. This includes the analysis of massive data and extrapolation of key information, autonomous integration of different processes, etc.

E) Technological Innovations Impact the Value Chain at All Stages

1) Design and Industrialization

  • Virtual designs
  • Big data
  • Collaboration platforms
  • Digital skills

2) Manufacturing and Operations

  • Robotics and automation
  • Big data
  • 3D printing
  • Cloud manufacturing
  • Predictive maintenance

3) Logistics, Distribution, and Sales

  • Automated and real-time tracking
  • E-commerce
  • Fleet management
  • Smart grid

4) Customer Management

  • Big data
  • Enhanced browsing experience and augmented reality
  • Internet of Things

New Organizational Models

1) Flatter Organizations

  • Almost “horizontal” organization
  • Oriented toward spontaneous coordination
  • Stimulates coordination among different levels of resources
  • Key importance of business leaders

2) Flatcharies

  • Flexible and collaboration-oriented structure
  • Presence of incubators or innovation labs
  • Presence of “flat teams”: temporary organizational units composed of interchangeable resources that operate autonomously

3) Holocracies

: a) completely “horizontal” organization structure b) distributed authority and decision power c) no leadership roles d) slef organization worrk teams d) requires small operating context