Technology has slowly and steadily seeped into all aspects of our lives, big or small. Business is no exception to this trend. In the age of information technology, computers and the internet have become as necessary to businesses as capital, in some cases even more so. Use of specialized hardware and software has made things quicker and less prone to errors, simple and repetitive tasks have been largely automated or will soon be short, communication has been revolutionized, and the rapidly lowering costs of technology are allowing small companies to compete with and outsmart larger corporations. These benefits have not come free of challenges, however. The rapid pace of improvement in technology, which fuels its disruptive powers also makes the future that much harder for managers and business leaders to predict. Careful thought and planning are required if businesses wish to reap the benefits and mitigate the drawbacks. Ultimately, it is safe to say that technology permeates through every fabric of the modern business.
In this modern day and age, there are few successful companies that do not rely heavily on technology. Technology, in all its various forms, has become a growing necessity in the business world. The ever-growing reliance that business has on technology has mushroomed to such an extent that it has become virtually impossible to separate the two. Staying up to date with the latest tools and trends in technology might not be that important on an individual level, but companies can ill afford to remain ignorant on this topic. Use of sophisticated technology is imperative for businesses to remain competitive in today’s cutthroat markets. This applies not just to large companies, but too small and medium-sized enterprises as well. Most successful companies today not only use technology but seamlessly integrate it into every aspect of their business.
A wide variety of technologies are used in businesses. These tools and technologies can, however, be generalized under the term information technology or IT. Using computers as a base, IT involves dealing with data sets in a wide variety of manners, including storing the data, transmitting or receiving it, analyzing it, manipulating it, and so on. While humans have been handling data for thousands of years, the advent of computing has brought with it a complete transformation in the way things are done. The ease of access, speed and capability of computers, and the tools and software it has spawned has revolutionized human affairs on a global scale. Its impact on business is mind-boggling, leading to tens of trillions of dollars in economic growth and prosperity. IT pervades every aspect of the business, all the way from design and manufacturing down to marketing and customer service.
Generally looking at businesses, there are several technologies that are utilized almost universally, regardless of the type of business or type of industry in which it is operating. The most basic of all is, of course, as discussed previously, the personal computer (PC). PCs are an incredible, generalized tool that is great at a wide variety of tasks. This property allows them to help out people regardless of which area of the business they are involved in. For businesses, computers can help in data storage, data processing, business research, production, marketing, advertising, team management, distribution and automating various business-related tasks, thereby increasing worker productivity while simultaneously lowering costs and speeding up the work. Simple things which used to be done on pen and paper like collection, management, calculation, arrangement and visualization of data are now done on computers using tools like Microsoft Word, Excel and PowerPoint, which are ubiquitous worldwide. Marketing, which is the lifeblood of businesses everywhere, is now completing reliant on computers. For example, producing marketing materials such as images and videos is now solely done on computers using software like Adobe Photoshop and After Effects.
While a computer by itself can be a powerful tool, its usefulness increases exponentially when it able to communicate with other computers using a shared network, in other words, the internet. The internet allows for lightning-fast communication between businesses and their customers. Social media allows companies to move beyond narrow focus groups and see how their products are being received out in the real world. Digital marketing is becoming increasingly important, and its relatively low cost allows small businesses to cost-effectively compete with larger companies. New businesses and business models are being invented, solely because of the internet. Companies are extracting granular data about market trends and the buying habits of their customers, allowing for more effective product development and more efficient marketing.
Interestingly enough, while the per-unit cost of computing has fallen rapidly as technology has improved, the increasing ubiquity, sophistication and complexity of computing tasks have made computing more expensive for companies. The solution to this problem has come in the form of cloud computing, which delivers advanced hardware resources and functionality for dramatically lower upfront costs. The lower cost of entry is particularly helpful for small firms hoping to employ advanced business-analytics, but do not have the capital to build such services in-house. The advent of cloud computing has also allowed startups with great ideas but small teams to disrupt large corporations, something that would not have been possible earlier. It also allows businesses to scale their services up or down intelligently, based on client demand.
A key technology used in nearly every type of business is CRM (Customer Relationship Management) software. CRM software allows for the tracking and automatic organization of customer data, customer interactions, vendors, inventory, sales and services, among other things. If, for example, a customer contacts customer service to find out details of a product they ordered, the CRM software will provide the representative with all the relevant information regarding the product such as its specifications, when it was ordered, when it was shipped and so on. By automating repetitive tasks such as these, companies can increase worker productivity and drastically reduce the number of employees they need. Another technology that has seen rapid adoption is Business Intelligence (BI) software. BI software refers to a collection of tools that enable upper management and knowledge workers such as analysts, managers and executives to make faster, more effective decisions. These software leverage the detailed data assets businesses have at their fingertips and analyze it using sophisticated techniques. The analyzed information is then presented to upper management, who can then utilize it to make smart business decisions.
Accounting software allows for secure and error-free tracking of a company’s finances, thus playing a mission-critical role in all businesses. With accuracy and swiftness that cannot be matched by human accountants, accounting software allows for automatic execution of transactions, as well as tracking the flow of capital, revenue, profits, expenses and losses. For businesses that sell goods, inventory control systems are routinely used. Such systems allow for precise tracking of all items in the inventory. This ensures that the company never runs out of stock, nor orders excessively. When new inventory arrives or when existing items are sold, these systems are updated to reflect the new total.
Last but not least, many businesses use VoIP (Voice over Internet Protocol) to route their phone calls over the internet. Cheap, high-quality communication between employees and departments is essential in ensuring optimal work performance and overall business success, but telephone bills can be quickly racked up. VoIP services, on the other hand, allow for the traffic to be routed a great deal cheaper over the internet. Also, these services usually come in the form of monthly subscription packages allowing businesses to choose a custom package that is suitable for them and then scale it up and down when the need arises.
These are just a few of the major technologies that have seen widespread usage in businesses across the world, transforming the global business landscape. However, these opportunities also come challenges that the people in charge must face. One major obstacle that managers face is selecting the right technology for the company. The abundance of choice makes the matter difficult, and failure to implement the technology well can result in a major loss in investment. But hesitation in the face of this fear is also not a viable option, as such delays can prevent the business from staying competitive. Managers must ensure that the system they choose not only meets their current needs but also delivers enough capacity for expansion in the future. To do this, management must have a clear idea of the business’s core objectives, present impediments, and what the company should look like in the future. The volatility of technology makes the economic climate ever-shifting, also making it hard for managers to determine and predict future market and customer trends. For businesses to do well, then, managers must not only be experts in management and business but should also be highly tech-savvy.
Other challenges include integrating newer technologies in older systems. With the pace at which technology advances, it soon comes time to upgrade certain applications. However, newer systems may not necessarily be designed to flawlessly integrate with legacy systems, especially when the systems are in different domains, for example, accounting systems and CRM systems. Bad integration can result in a huge loss in employee and operational efficiency, as data becomes hard to track and find quickly. Cybersecurity is another major issue. Company data must be secured, as cybercriminals grow increasingly sophisticated. Business data falling into the wrong hands can be very costly, and security breaches can ruin people’s trust in the company. While there is more data available now than ever before, it still needs to be utilized in the right way to draw meaningful insight from it. Using overly simple metrics for determining the company’s performance can lead to blunders in future decision making. In order to properly gauge performance, managers need to select a group of well-rounded key performance indicators (KPI) to ensure the validity of insight drawn from it. The internet and social media have allowed customers to publicly and vocally announce their displeasure with a business’s products or services. This leaves management with less room for errors and compels companies to constantly monitor and maintain their reputation online.
Overall, we can see that technology has meaningfully impacted all facets of the business. Observing business operations, it is clear that technology has severely decreased operating costs for businesses. Various consumer and enterprise software and solutions have sped up operations. Different aspects have been automated, leading to smaller, more agile teams where each person can carry out a wider variety of tasks and has a greater responsibility. Menial, repetitive tasks are handled by computers, freeing up people to work on more interesting and creative problems. This democratization of power through technology has allowed small businesses to compete with large multinationals. Technology also makes it possible for businesses to access a wider customer base. Rather than focus locally, companies have the option to reach national and international markets. This increase in market competition helps provide consumers with better products and services.
Marketing is no longer limited to prints and billboards, with digital advertising spends increasing rapidly year-on-year. New forms of marketing, such as social media and influencer marketing, are on the rise. Using customer data allows companies to target specific individuals based on their location or their shopping history. A wide, even global, the audience can be reached for comparatively lower costs than those associated with traditional media. Manufacturing and production processes have been greatly streamlined, allowing for the production of high-quality goods for low prices. Manufacturing, as with other fields, is becoming automated, with sophisticated robots performing tasks quickly and with high precision. Sales have been changed as well, with specialized software allowing salespeople to deliver faster quotes and have quicker turnaround times for proposals. Mobile technology has allowed for continued connectivity with the head office on the road, making representatives more responsive and productive. Contracts can now also be signed from anywhere, regardless of whether the interested party is halfway across the world. Human resources (HR) tasks such as onboarding, offboarding, payroll etc. are also either automated or made much quicker and easier through specialized HR software. All in all, there is simply no facet of business that technology has not changed.
To conclude, technology has influenced business in an uncountable number of ways. A few particularly major ways in which technology has changed business is in speed, connectivity, data analysis and automation. Computers have completely changed the speed at which the world operates. The computing power modern computers can bring to bear on a problem is unprecedented. Vast amounts of data can be collected and analyzed to reveal trends in the market and consumer behaviour. Real-time communication from halfway across the world has connected businesses with customers, and members of an organization with each in a way that has never been done before. This connectivity, along with automation, has allowed for worker productivity to skyrocket. A single worker can now do in hours what used to take multiple workers days to complete. Old positions have been either eliminated completely or merged, while at the same time, new careers that had never existed before are being created. Challenges still exist, including ones that are created because of the technology itself, but overall, the influence of technology on business has been for the better.