The way businesses around the world are improving and changing; technology played a significant role in that. Technological factors create scopes for new products, markets, and demands. As a result, businesses find contemporary ways to produce, communicate, and distribute their goods and services. Although these changes are, most of the time, predictive, still coping-up with changes becomes quite challenging for companies.
Technological Factors of PESTLE Affecting Businesses
Automation
Since the industrial revolution in 1760, the world is rapidly stepping towards automation. Businesses who never thought of producing something through machines are now can’t think about doing anything without machines. Automation is replacing people’s activities with businesses. The speed, quantity, and quality a machine can provide can’t be expected from a human. Even in many big companies around the world, they’re using machines for customer service and other activities. The importance and comfort of automation have made businesses to change their way of doing work.
Big Data
Today’s world is all about Big Data. Companies around the world can’t even think of doing their research and development activities without Big Data. It has helped businesses gather a massive amount of random qualitative and quantitative data about their customers (both current and potential) and turn them into useful and to the point insights. Big Data is sometimes considered as the most significant innovation of humankind after the internet. It has opened another dimension for businesses. Now they can store and use millions of data and for R&D and build their business strategies. You may realize that companies are now more successful in satisfying people by providing precisely what they want. And this miracle has been possible because of Big Data.
E-Commerce
Although it’s there’re physical shops everywhere, and people go to those stores, E-commerce has made a distinct place alongside. Now there’re more shops online than offline. Even many old businesses are also operating their activities, both online and offline. There’s no doubt that E-commerce has changed how people used to do business in the past. Now anyone can start their own business anytime just by sitting at their home. The cost-effectiveness, flexibility, reaching more people, has made E-commerce as the blessing of technology. Consumers are also getting more interested in doing shopping online than going to a physical store. They prefer to get delivered their products at home due to their busy schedule. And businesses are also transforming themselves based on the current demand and trends.
AI & VR
If someone asks what will be the next generation of technology, people will say AI (Artificial Intelligence) and VR (Virtual Reality) instantly. Many companies around the world are already developing these two technologies for different purposes. Although these are still at an experimental level, researchers are claiming that AI and VR will change the world scenario and the way of doing business within a few years. The existing companies are already investing to a large extent on AI and VR. In the future, it can be hoped that no new companies will enter the market without adapting these two technologies.
Online Promotion
Digitalization and technology have changed the way of doing promotion and marketing. Businesses are now more focused on doing online promotion than traditional ones. From B2C to B2B, every kind of company are currently active on social media and other digital platforms to reach people. Businesses which doesn’t have a strong online presence are struggling with the competition. That’s why, at present, we see more advertisements and engagement online than offline.
Security
Technology has made it easier to collect more data and use that for your own advantage. Simultaneously, it has made it difficult to put a fine line of security while collecting the data. No matter how much protection you ensure, in the world of internet, everything can be hacked. That’s why there’s no guarantee that the way you’re collecting other’s data, someone else won’t do the same with you. Digitization has made us to do many unethical actions that have put everyone’s privacy at stake. For the sake of gaining a competitive advantage, businesses are now engaged in unfair competition and harming each other’s security.
Cost of Innovation
There’s no doubt that technology has opened a new dimension for the business world, and now companies can show more creativity, reach more people with more comfort and ease. But the process of transforming a business into something new or adopting a new strategy out of the blue gets difficult for many companies. Not everyone has the capacity or resources to do that. As a result, the cost of innovation becomes a burden for those businesses, and ultimately they lose the competition with the big fishes of the market.
Bottom Line
Technological changes will keep happening, and businesses have no choice but to adopt those changes. And there’s no way of denying that technology has come with many blessings from time to time, which helped businesses to grow more than ever. Although it’s necessary to play a fair game while using technology or else it may bring troubles as well.
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References
- https://www.oksbdc.org/why-is-technology-important-in-business/
- https://www.bbc.co.uk/bitesize/guides/zd3prj6/revision/5
- https://www.redalkemi.com/blog/post/impact-of-technology-on-business-environment
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