Guess which economy will record the fastest growth in the next five years?
You will be forgiven if a country's name comes up first in your mind.
The correct answer is an industry that is expected to grow by $6 billion in just five years. The digital industry was worth a little over $19 billion in 2015 and will reach to more than $25 billion in 2020.
Fast moving disruptions are creating new economies and transforming experiences on a never before scale. With the prevalence of mobile technology and digital infrastructure, a dynamic business environment has been created for businesses regardless of industry, functions or sector. It is in this environment that the digital economy thrives with front line activities that fosters broad engagement with customers across value chain in a journey.
Transitioning from physical to digital
The digital economy is borne as a result of billions of connections between between people, products & services, businesses, personal and public data. And these connections are locked on by the power of web. Aware of the immense scope for (more) growth, businesses are quickly learning to analyse this tsunami of big data and extract value from it.
Innovation as the core disruptor
The words 'innovation', 'disruption' and 'start ups' are sprayed around when any talk is made about digital economy. Buoyed by the tremendous success of startups and the way they are harnessing the power of technology to transform embeded notions of services, convenience and life, giant corporations are deploying incubators in the hope of taking a (big) slice of the digital economy. However, there are four key points dotting this new age state of affairs. They are…
1. Services
It is beyond doubt that Uber is a highly disruptive service that tapped into an area that very few cab firms would have even thought of. More than that,they made full use of the technology people already had and they did so brilliantly. Today, there are a growing number of similar services and not just in the private cab arena. Delivery companies are now also opening up new areas of business andcreating a lot of jobs in the process. Deliveroo is just one such example. By taking a previously neglected area of the service industry and making use of digital connections, Deliveroo disrupted an otherwise sedate market. Self employed couriers work their own areas, with their own transport methods and use digital devices to receive work, payment, directions etc.
Financial services are creating new services like online investing, robo advisory systems that give automatic recommendations for customer needs etc. These services are integrated with digital tools like CRM solutions to make adoption easier and faster.
2. Products
Massive advancements in battery technology, led in no small way by Tesla, and of course the navigation and detection software have meant that vehicles are becoming more autonomous and cost efficient. Self driving freight trucks are able to go on through the night, constantly updating HQ with their location And status. Incredibly efficient, when compared to traditional haulage methods, autonomous vehicle technology has the capacity to completely change the face of the industry.
On the financial side, mobile wallets like MPesa, Paytm and digital currencies like Bitcoins, Ethereum etc. are proofs of destruction of financial barriers and digital finance maturity.
3. Devices
Autonomous homes with the latest devices from the likes of Google, Amazon and Apple (Alexa, Echo etc.)are transforming our personal spaces. Shopping from any room in your home, with just your voice? A few years ago you would be been called insane. Today, Alexa from Amazon makes that possible. Lighting, heating, music, security and even restocking your fridge, can all be done from a smartphone and you don’t even need to be home to do it. Checking and acting on your financial needs just takes your voice. Be it checking your savings balance, mortgage offers etc.
Researchers are now taking AI to the next level with deep machine learning to make them intelligent enough to verbally recommend the best schemes for you. (Amazon has offered a $ 1 million reward for creating a bot that coherently and intelligently 'chats' for 20 minutes.)
4. Algorithms
Experimental technologies like smart cross sell through CRM, sales performance or visual modelers uses algorithms to power digital intelligence for businesses. Primarily deployed to mine data, it is the new tool for the gold rush (big data) of the century. As technology advances, algorithms will grow more powerful and self learning that will ultimately lead to the birth of intelligence that is not artificial anymore.
Significant challenges with regards to the digital economy like technology, privacy concerns, ownership barriers etc. needs to be resolved
