A Look at the way Technology is Fundamentally Changing how Business Works
That technology has changed the way businesses operate is hardly a revelation. Nearly every company, regardless of industry, has undergone some type of shift within the past decade because of technological ingenuity. But as obvious as the broader existence of change is, the specific developments initiated by new technologies are not always so easy to comprehend.
A recent review from the Economist investigates claims from a new book, Machine, Platform, Crowd, by Andrew McAfee and Erik Brynjolfsson, which looks at how technology is changing the way businesses operate.
The first takeaway is that technology is no longer exclusively being used as a tool. Instead, “Computers [have improved] and take more control” away from the humans that previously used them. Citations of self-driving cards and cashier-free POS services are used to substantiate this point.
The treatise also focuses on a movement away from products and toward platforms. “The largest cab service owns no vehicles (Uber), the biggest hotelier has no property (Airbnb), the most comprehensive retailer holds no inventory (Alibaba) and the most valuable “media” company creates some content but not much (Facebook).”
Part of the appeal for businesses is that platforms scale more easily than products. Though the examples given by the book involve multi-national organizations, the same scalability can be seen on a smaller level. Scalable ERPs hosted in the cloud can easily be configured and scaled based on the needs of a user. Rather than relying on hardware (a more traditional product), companies are increasingly turning to software to operate with greater flexibility and effectiveness.
The final change cited in the article is a shift from core to crowd, or centralized internal elements to decentralized, self-perpetuating ones, like Wikipedia. This shift, it is argued, has been brought about by the decreasing cost of interaction and mass contribution.
The themes put forth by the authors highlight the magnitude of technology’s impact on businesses. Where once a computer made traditional tasks easier, new technologies are fundamentally altering the tasks and outcomes themselves.