Digital Thinking and Innovation CT109-3-1

Digitization of Businesses

• Social media platforms have connected people worldwide, eliminating time and space barriers to communication
• Examples of social media platforms with massive user bases:
  • Telegram: 400 million users
  • Sina Weibo: 500 million users
  • WeChat: 500 million users
  • Facebook: 1.2 billion users
  • WhatsApp: 1.6 billion users

Impact of Digitization

• The rapid evolution of digital technologies has led to a flood of information at virtually no cost
• Promotes closer links between humans, things, and humans and things
• Individuals, companies, industries, and countries will be affected by the digital revolution

Kodak's Failure to Adapt

• Kodak was the undisputed king of photographic film with a two-thirds global market share
• Kodak created many "firsts" but failed to keep up with digital technologies
• Examples of Kodaks's achievements:
  • It came out on top in the imaging and photographic film market
  • It created the world's first digital camera using a Charge Coupled Device (CCD)

The Ever-Changing Digital Business World

• The leaders in the digital age can easily fall behind
• Examples of companies that have fallen:
  • Top 4 Tech giants Microsoft, Intel, HP, and Yahoo have been dethroned by Apple, Google, Amazon, and Facebook
  • Nokia and Blackberry ended up selling their assets
• Market players are inspired by the Internet

Digital Trends

• Categories of digital trends:
  • Big data, cloud computing, mobile internet (focuses on changes in infrastructure)
  • Software-defined anything (focuses on changes in productivity)
  • Outsourcing and crowdsourcing (focuses on changes in production organization)
  • Prosumer economy (focuses on changes in forces of economic growth)
  • Long tail (focuses on changes in the competitive landscape)
  • Digital finance (focuses on changes in financial entities and technologies)
  • Collaboration (focuses on changes in operations models)

Big Data

• Big data emphasizes using new thinking to interpret data with the help of the Internet
• Examples of companies that use big data:
  • Spotify uses Big Data Analytics to give informed music recommendations and suggestions
  • Amazon Prime uses big data to offer videos, music, and Kindle books

Cloud Computing

• Cloud computing provides resources and services accessed via the Internet
• Characteristics of cloud computing:
  • Virtualized Computing Platform
  • Scalable use of computing resources
  • Pay-per-Use concept

Mobile Internet

• The mobile Internet is reshaping our lifestyle
• Examples of mobile Internet usage:
  • Using Waze to navigate
  • Browsing news, reading novels, tweeting, playing games, or watching movies on mobile devices

Software-Defined Anything

• Software-defined anything is a growing trend towards disrupting traditional ways of thinking
• Examples of companies that exemplify software-defined anything:
  • Amazon (the world's largest bookseller)
  • Netflix (largest video service by number of subscribers)
  • Apple's iTunes (dominant music company)

Outsourcing and Crowdsourcing

• Outsourcing: focus on what you do best and let others do the rest
• Crowdsourcing: encourages consumers and users to take charge and pursue their goals
• Examples of crowdsourcing:
  • DigitalGlobe's Tomnod initiative to locate a missing plane
  • Waze's map editing and updating
  • Applause's software testing and debugging
  • Wikipedia's crowdsourced knowledge base

Prosumer Economy

• The prosumer economy reshapes the supply chain into the demand chain
• Characteristics of the prosumer economy:
  • Consumer demand plays a leading role
  • Individuals not only consume but also produce

Long Tail

• The long tail refers to the large number of products that sell in small quantities
• Companies achieve economies of scale by increasing production and lowering costs
• Example of economies of scale:
  • Reduction in per-unit cost of production when production volume increases

DIGITAL FINANCE

• •In traditional payment models, customers can’t gain access to the settlement systems of all banks given the cost and efficiency restrictions

  •Third-party payment companies integrate the gateway interfaces and build a bridge between numerous merchants and banks

  –PayPal

  –Alipay

  –Google Wallet