Tech to Business.....

10 ways technology will disrupt existing business practices

Digital technologies will lead to many opportunities, many of which will be incremental improvements to business processes and customer interactions. However, the digital future will also contain many disruptive business opportunities and threats that will be pursued by aggressive and forward-thinking enterprises. If taken to their full potential, the disrupters can also lead to major changes in the way nations trade, how goods and services are taxed, and how companies manage capital.

Having an overall grasp on how digital can impact all parts of a business is very important to developing a comprehensive digital business strategy for CIOs and CDOs. Although most enterprises won't go this far, here are 10 ways more forward-thinking companies and governments may choose to go.

10 ways digital will disrupt business practices:

1. Manufacturing will gain more options to produce goods throughout the supply chain, instead of just before it - Manufacturing and supply chain have been on a path toward integration for quite some time This convergence will be accelerated even further as 3D printing, additive manufacturing and other digital production technologies potentially turn any channel, node or partner into an entity capable of manufacturing. Although we can already manufacture at any node with sufficient investment, digital technologies bring a flexibility and agility that take this concept to a new level.

2. Product management will gain the option of having long, ultrashort and never-ending market life cycles for the same product - Market demand is the main input that product managers use to time product life cycles. Manufacturing and distribution capacity are then allocated based on this timing. However, because of 3D printing's ability to print on demand, product managers gain an interesting mix of options:

Never-ending market life cyAnchorcle There is no longer a need to sunset products that can be 3D-printed. Traditionally, a product reaches a point in its life cycle where it is no longer economically viable to hold inventory or allocate manufacturing capacity because of low, sporadic demand. However, 3D printing changes these economics by making the item printable by anyone who has purchased the rights and has 3D manufacturing capability. The market life cycle of these items is potentially indefinite.

Ultrashort market life cycle 3D printing also makes it possible to economically manufacture very low-quantity runs. Mass customization and limited-edition runs can be constantly launched.

3. Sourcing goods will go local as the traditional options of "make/buy" and "offshore/onshore" blur - The way enterprises source finished and semifinished goods will also be disrupted in the digital future. Sourcing to meet demand starts with two fundamental decisions: make or buy, and onshore or offshore. These fundamental decisions are always influenced by the risk profile of suppliers and the supply base location/proximity to demand/point of use. The digital future will add new technology options that will blur these decisions even further (such as 3D printing onsite rather than importing), especially for items that are simpler to manufacture (think housewares versus high-tech components).

4. Cash and capital will be conserved in new ways in the digital future - Digital technologies can be leveraged in ways that help conserve cash. For example, if inventory can be manufactured on demand (using 3D printing, for example), then the capital tied up in inventory can be reduced. The consumable, raw materials used by 3D printers would be the only major variable cost requiring a capital outlay. And, even then, if the inventory will be produced by the purchaser (meaning that they print it on their 3D equipment using their own raw materials), then only minimum cash is tied into staged raw materials and work in process inventories.

5. New leasing models will use transparency to remove risk - Today, many closed-end leases are calculated on depreciation schedules that are more or less based on calendar time and presumed usage. They are calculated guesses. The internet of things will bring visibility to how an asset is used - bringing more accuracy to lease arrangements.

6. Lending will gain new ways to assess risk in the unbanked segment, leading to new markets and products - The unbanked and the underbanked customer segment represents a large, new market to many consumer industries and financial services institutions.. But the traditional credit and loan products have been the territory of payday loan companies and gray market sources. New big data and analytics technologies combined with new loan approaches (look a. AliLoan) will open up this market to a broader set of financial institutions.

7. Taxation strategies will need to be adjusted for the digital future - The success of e-commerce brought the need to revise sales taxation policies. It was and still is in some countries such an important regulatory ruling that it creates and destroys competitive advantages. The digital future will also require the same type of tax policy considerations. For example, governments should consider if 3D printing will change the trade balance for certain goods categories (e.g. toys).

8. Workforce planning will include humans, augmented humans and smart machines - Machines have been replacing human labor since the Industrial Age. However, as we enter the digital age, a new set of choices start to emerge with the introduction of smart machines.

9. Customer service will need to provide customers with transparency to everything- As things, places, people and systems become increasingly connected, the ability to monitor operations, statuses, service levels and many other metrics become possible. Customers will know this and demand this from enterprises. For example, most of us take for granted that we can track a courier-delivered package throughout its entire delivery trip. Using digital technologies such as IoT sensors, governments and airports can share how long the wait time is in their service centers and security check-in areas. Mall operators and cities can share where parking spots are available in real time.

10. Loyalty management will expand, since points will be awarded before and after the transaction Why is it that loyalty points are granted only after we buy the groceries or take the flight? This is because enterprises recognize and reward customers' loyalty for the business they just conducted. However, aren't customers and prospects demonstrating loyalty by pressing the "Like" button on Facebook or just entering a store to browse? Loyalty is a characteristic that can be demonstrated by customers and prospects throughout their entire relationship with an enterprise.