Business is the activity of making money by producing or buying and selling products. It has been around throughout whole history of humanity. But since ancient times it, naturally, morphed into something far more complex than simple trade of goods, and none of that would have been possible without some kind of technology.
Nowadays, when people use the term “technology”, it usually means information technology, or IT. Information technology is a subset of so-called information and communications technology (ICT), referring specifically to the use of computers and manipulation of data and information. Information technology is crucial to the modern society, and is the one affecting the world of business in the most prominent way.
At first, the Industrial Revolution changed things in the business world, making a lot of processes more efficient, increasing work productivity and starting a new industrial era. With the new technological revolution, and the use of information technology in business, things changed even more drastically than during the Industrial Revolution. This new revolution is actually the third one, also known as the Digital Revolution. It brings many changes that heavily affect the business world, including prominent use of computers and digital technologies. Some economists also suggest that we are standing at the beginning of the fourth industrial revolution. It encompasses such innovations as artificial intelligence, nanotechnology, quantum computing, fifth-generation wireless technologies (5G), the Internet of Things and so on. Those are technologies which aren’t exactly relevant in the everyday life yet, but will be in the near future. The technology is adapting and evolving at an exponential rate, and all businesses are being swept by this wave of novelties, whether they are ready for it or not. For example, even just 5 years ago, social media wasn’t overridden with consumerism, mobile phones weren’t used for business, cloud-based solutions did not exist, and omni-channel marketing was taking its baby steps. Today all of those are part of everyday life.
Over the years, technology has caused an explosion in commerce and trade. Many traditional business models and concepts were revolutionized because of the new possibilities. Technology gave us the opportunity to see things from a new perspective. But more importantly, it gave us greater efficiency for conducting business.
Information technology can be crucial to the organization in numerous ways. First of all, without technology the major industries of the world would simply collapse in an instant. In the 21st century, most business transactions and operations simply cannot be conducted without use of IT. Other areas in which today’s technology is crucial to business include the use of ICT in management, point of sales systems, accounting systems, and other complex aspects of everyday business activities. It is hard to imagine any business that has not benefited from the digital revolution – even something as hands on as agriculture uses computers. Technology allows us to automate numerous processes, which thereby increases our productivity. It enables us to use fewer resources, thereby enabling us to improve on quality at a low cost and to improve the speed in which the product can be delivered to customers. It also presents possibility to serve even more clients.
Technology also makes it easy to store more information while maintaining the integrity of that information. We are better able to store sensitive and confidential information in a way that makes it less vulnerable to a data breach. The information can be retrieved instantly when needed, and it can be analyzed not only to study past trends but also to forecast the future. This can help with the decision-making process, which is extremely important in the business world.
Communication is also a part of business. The process of transportation makes business a web of complicated processes that interplay with each other. With modern technology, it has become possible to globalize business operations. Today just about anyone can do business practically anywhere.
Mobility is seen as the next great frontier for businesses. Google’s algorithms reflect this, as they make mobile websites a priority. Every aspect of your business can be handled using nothing more than a tablet or smartphone, from content marketing to customer relations, to sales and the back-end stuff like invoicing and shipping. Mobile solutions aren’t just about businesses, though; they are also about consumers. It is reasonable, as modern generation uses their phones for basically everything.
Cloud computing has made it possible for businesses to outsource many of their functions to third parties using the internet. It makes it possible for variable data packages to be handled but also makes it possible for businesses to expand rapidly and embrace mobility without having to worry about such things as crashes, downtime, and lost data. This has enabled small and medium-sized businesses to gain access to resources that would have cost them a fortune only a few years ago. Cloud computing provides the processing power necessary to organize and use large quantities of data (so-called “big data”), which is also beneficial for small businesses.According to a survey conducted in 2018, 62% of small and midsize businesses are already using cloud computing, while 33% are either planning on implementing the technology or evaluating how it could best be used by their organization.
Since more and more data is flowing, it is now much easier to analyze and gain deep insight into the things that customers are looking for. Analytics services are expanding by the day and are allowing businesses to segment their prospects into more and more specific groups, making it much easier to target them and get more value for their advertising money. For example, Google account can let a business know where a user is from, the kind of browser they’re using, how they stumbled upon a website, what they do on that website, how long they are likely to stay and at what point they decide to leave. There are even more advanced analytics services that allow businesses to become even more refined with this segmentation in order to improve their conversions drastically.
Technology has made it way easier for people to stay in touch. Whether you’re looking to communicate with your employees and colleagues via video chat or sending email blasts to leads, mobile technology and the constant innovation that takes place within the space has made it possible for communication to take on a new level of hyper-realism.
There are two main things that have come together to make what is called a “buyer’s market” possible: the fact that both hardware and software are needed in creating the necessary software solutions have become more affordable and the fact that more and more entrepreneurs who are also tech-savvy are appearing to make use of these technologies. There was a time when it would take a large company about a year to build a back-end inventory system. Now a few college graduates can do the same in a matter of weeks. Since the solutions are offered affordably and very easy to use, businesses do not have to invest too much money into them and that has made business easier.
On the other hand, it cannot be denied that information technology also poses some threats to business. It opens countless possibilities to malicious activities, such as hacking. Because of this, it is important for businesses to exercise responsibility when using technology to conduct business. With an increasing number of transactions happening online, it is important for financial and security institutions to work together to make the internet a safer place. As more transactions are done on the internet, the need for more networks and greater security rises greatly, making it possible for banks to keep purchases and sales secure. Through the use of encryption and passwords, digital data can be safely hidden away and can only be accessed by those who have owner’s permission. It still isn’t perfect, though, and it is still one of the biggest downsides to the use of new technologies.
The other big thing is that social networking has made the world a smaller place where users can connect regardless of who they are. Only a few years ago you could have gotten by if your customer service was just okay. Now you have to put in the extra effort if you don’t want unfavorable ratings on review sites and people going on rants on social media about your service. Businesses need to be very careful about their online reputation and have to work on their digital footprint.
This is another negative effect of technology. With increased connectivity, people have less and less time to themselves now. Since we can always access our emails, texts, and social media through our phones and laptops, it is harder and harder to just disconnect and wind down. The lack of privacy and companies collecting the user’s data is also becoming an issue. All of this is part of another, much more global problem, though. It is questionable whether we’ll ever find the solution to that.
In conclusion, the use of digital technologies is integral to not only modern business and economics, but to the society as a whole. With all its downsides and difficulties, it steadily leads us into the future. Nowadays, it is impossible to run a business without use of IT and it is very important to learn and make use of new technologies.
1. Nicky LaMarco. Information Technology & Its Uses in Business Management. https://smallbusiness.chron.com/information-technology-its-uses-business-management-51648.html
2. Klaus Schwab. The Fourth Industrial Revolution: what it means, how to respond. https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/
3. Alec Sears. 5 Benefits of Cloud Technology for Small Businesses in 2018. https://blog.capterra.com/benefits-cloud-technology/
4. Jeremy Rifkin. The Third Industrial Revolution: How Lateral Power is Transforming Energy, the Economy, and the World. /ISBN 978-0230341975, 2011