Disruption is the not-so-secret magic wand for breaking the lock to unexplored potential. Structuring and dismantling the scape of consumption and production, the word disruption is not only doing the rounds more in the world of business lately, but is finding recognition in our day to day choices and commitments as transformation is no longer a thought to contemplate for an evolving future, but rather a need to sustain. Digital transformation engages various building blocks and layers within a network of people and processes to achieve efficiency and cost effective results with appropriate digital applications for same. The exponential growth of technology and its effect on business can be elucidated as follows- firstly, as observed by Moore's law, the capacity of transistors in a microchip doubles every second year, leading to doubled processing power, speed and efficiency of microchips exponentially every second year. Microchips are commonly used in smartphones, laptops, automotive, and other industries. This mandates businesses to adopt simultaneously. Secondly, Butter's law states that every nine months, the passage of data in fiber optics cables doubles exponentially. Therefore, 2G, 3G, 4G and now 5G. Lastly, Kryder's law says that data stored per centimetre in a hard drive doubles every 18 months exponentially. +Population, nuclear fission, bacterial growth, have all been seen to display exponential behavior, giving them an edge over linear thought and action. Accustomed linear patterns provide a fertile ground for miscalculated decisions based out of comfort zones and the inability to adapt to the rapid pace of technological and other advancements. A company choosing to stick with linear solutions, while support mechanics are offering exponential transitions, will find itself falling through the gap created between potential and actual value delivery.
Digital advancements continue to set a base for all existing and upcoming companies. Technological evolution is committing businesses to architectural breakthroughs, benefiting the company's structure, processes, and business strategy. A vertically assimilated flow that determines how the business is organized in an industry is a value chain; comprising a conglomeration of suppliers, producers, and distributors contributing to the performance of every step in converting raw material to a commercialized product. Multiple steps are fused in the value chain to become a member of the elite with few other vertically assimilated competitors. Vertical assimilation has been adopted as the best way to direct the flow of goods and information by businesses in aligning with various resources and components within a value chain for smooth collaboration between multiple suppliers, distributors, and above all, to ensure cost-effectiveness and quality standards. Thus, a value chain with more minor transactions means lower costs and time efficiency in marketing the product. This deconstruction of the value chain aids players in each layer by resolving issues related to their specific functions, the success factor at the bottom being the scale, and at the top innovation, start-ups can either flourish or die without any impact on lower stacks. Therefore, stacked architecture allows new business models to attack the work of reigning service providers. Industries are consistently focused on progressing efficient solutions and are adopting new technologies such as blockchain for the same.
The term disruption is inseparable from the dynamic patterns of digital transformation with its vast reach over the potential to interrupt numerous markets and industries, it has irked the attention of many economists, Joseph Schumpeter being one of the foremost enthusiasts to study the disruptive personality of every shift worth assessing, he left behind for reference, his understanding of disruption through 'the perennial gale of creative destruction', as mentioned in the chapter, 'The Process of Creative Destruction'. Schumpeter, talks about the potentiality always bubbling beneath the surface to break through into a new process or piece entirely. Motorola, Inc. for instance, started its disruptive journey in the 1930s, when Paul and Joseph Galvin attended an auction that saw them leaving as the proud owners of battery eliminator units and equipment from a recently bankrupt Stewart Battery Company; they named this fresh exploration of their new ownership, 'Galvin Manufacturing Company'. But, as had already been decided by the market at the time, light from this bulb was not disruptive enough for the advancing radio technology beginning to pronounce itself. Galvin Manufacturers then, decided to provide entertainment to commuters by offering audio systems in their vehicles, and that too, while keeping them affordable, striking just the right note with this much-welcomed trend, and granting an exponential welcome to Galvin Manufacturers' new baby, Motorola, Inc. bringing with itself the collective freedom to choose an individual experience on the road. In 1947, Motorola, Inc. welcomed people to visual entertainment with TV sets and then began in 1958 to equip NASA's explores with radio equipment, including Appollo 11's flight to the moon. In 1974 came MC 6800, a microprocessor used for computers and automobiles. Next Generation 32bit MC 68000 microprocessor came along in 1984 to power Apple, Atari, and HP. And then, Motorola, Inc. launched the world's first commercial cellular device - Motorola DynaTAC 8000x, and then came Orbitel TPU in 1991 established in Europe for the first time powered by GSM technology which ushered in 2G to explore markets, customer expectations and disruptive motivations. As 3G stepped in to grant other companies acceleration, Motorola, Inc. refrained from opening its doors as spontaneously as it should've. But, made news again with Razer's sleek flip small body in 2005. And in came the smartphone- by 2007, Apple's iPhone had taken good advantage of Motorola's slow response to innovative phone technology. With other companies like Samsung and LG following Apple's lead, Motorola, Inc. could not resist support from Google, and in 2011, it split into Motorola Mobility and Motorola Solutions. Likewise, Yahoo's valuation around 2000 was $125 Billion and made an offer to purchase Google and Facebook, but failed to make changes in its services to meet expectant demands. As it entered the 20th century, digitalization became a prominent topic for debates in enacting governmental and other policies, resulting in the Digital Single Market in 2015, prescribing a nationwide digital policy by the EU, serving also as a framework for healthy participation and transformation of digital communities, and an integrated community-at-large. The developments are ongoing, there is always a disruption awaiting progress, and the contenders decide where this goes.
Innovation cannot be suppressed, with as much time being spent on research and development, new products have become a norm and the demands being catered to, are also changing just as rapidly as the growing prowess of each industry. Competition is fierce, and this is inevitable. +Disruption and transformation of industries for digital adaptation led to the rise in competitive life cycle analysis. S curve of competitive life cycle illustrates the profit and sales of industry by analyzing the environment associated with it. At the beginning of S curve industries adopt new technologies, steadily increasing their productivity. Then in a growth phase, due to technological inclusion industries catch maximum sales and increase competitors when profit rate is increasing. Further, mature phase leads to declining growth and stable sales in an industry. Now, technology also has various phases that impact industries and the environment, 'annealing' is a merging of dominant technology with industries over time for positive technical impact. 'Shakeout' refers to a scenario when several competitors join the industry as market starts to grow, and merging or backing out when too many competitors join as they see a boom. The most questionable part of competitive life cycle is margin or profit which is dependent on various factors. At first, the margin might be negative or negligible but as the industry starts to grow, margin increases. And as margin increases, lots of competitors again enter, this leads to compressed margin. +Competitive life cycle moves around with a common footprint among industries and is useful in interpreting the essence of digital transformation. Let’s take the automobile sector as an example, in the US, Studebaker brothers were the most successful manufacturers of horse-drawn carriages, and jumped into the automobile industry when bicycles began to gain popularity. Eventually, different drive trains were launched in the industry using steam power engines, kerosene powered engines and gasoline internal combustion engines, all contending for dominance in the industry. This is where innovation shifted towards experimentation. It is not that the best technology or the initial entrant of the new technology is guaranteed long-term success, there are many factors that determine the dominance of one technology over another. The late 1930s, saw electric vehicles in use across different cities throughout the world. The industry saw more efficiency with big giants like Ford, General Motors, and Chrysler. Studebaker made history, but remained there. The industry is currently gearing up for disruption by electric and autonomous vehicles as a result of the Tesla, Volvo, and General Motors' drive towards new generation vehicles.
Disruption implies that conventional wellsprings of competitive advantage are substantially fading. One of the domain's old competitive advantages in danger is 'economies of scale'- another territory once a competitive advantage, now learning curves. Given that the customary wellsprings of benefit are getting delicate, organizations struggle to craft their systems, and in such conditions, innovation or technological change has a high disruptive potential. Incumbent firms fail to be confronted with these disturbances when they neglect the worth of the new advancements and instead stress over cannibalizing their items. This generally winds up with the organization, in the long run, escaping business. A gander at their success points towards the capacity for innovation in terms of both capital and expertise or good R&D, in some cases, available only with and to enormous incumbent players. Also, incumbent firms may use some crucial resources or the ability for their potential benefit. To sum it up, a few organizations can conform with ease to changing business conditions with the right blend of approaches to meet dynamic needs, a unique ability keeping them standing the test of time.
The world is progressing faster than ever. The last few decades have seen digital transformation peaking, adding an ample amount of digital data across the value chain. Let's take factory equipment as an example, nowadays, factories are equipped with sensors to track the performance of machinery and accessibility during the manufacturing process. In this way, digital technologies bring about a prodigious industrial and technological transformation that influences our lives in unanticipated ways. The world's stock of information is continuously growing and making ways for new digital technologies and services. Big data, the Internet of Things (IoT), mobility, cloud service, social media, and blockchain are some evident examples. These digital technologies help in driving industries to another level of digital customer engagement and IT-enabled business services. In recent years, big data is seen penetrating businesses more deeply as a collection of data that grows exponentially with time. Roger Mougalas from O'Reilly Media coined the term "Big Data", in 2005. Soon after, in 2006, Web 2.0 appeared. A space that provides sources to extract information from complex data sets. The different aspects of big data evaluate challenges like capturing data, data storage, data analysis, search, sharing, transfer, visualization, updating, and information privacy. Nowadays, big data cannot be stored or processed by traditional data management tools due to its complexity and larger size. Take, for example Facebook, it can generate 4 petabytes of new data ingested in the database of the social media site every day. A database of 10+ terabytes of data can be generated by a single jet engine in just 30 minutes of flight time. Also, big data reaches petabytes (10^15 bytes) with thousands of flights per day. Big data applications are being used for banking and security, healthcare provisions, insurance, transportation, retail and wholesale trade, media and entertainment, etc. Moreover, volume, variety, and velocity are the three main characteristics of big data. The volume of data is a prominent factor for deciding whether data can be considered 'big data', or not. The velocity is defined through the lightning speed of data at which big data is generated, processed, and analyzed. The heterogeneous sources from which data is collected in the form of text, video, images, audio, etc., are the variety that determines the nature of data, both structured and unstructured. Let's take an example of an analog and digital database to understand better, by the end of the 19th century, an estimated 95 percent of information was stored in analog format, only 5 percent of the stored information was digital. In the next century, a whole of 25 percent of the stored information data was digital at 55 exabytes (55*10^18). By 2003, both digital and analog data equally accounted for 50 percent each. In 2007, 94% of the storage information of the world was digital at around 300 exabytes. An IDC and Seagate white paper foresees 40 zettabytes (40*10^21) in stored digital information by the beginning of 2021. Organizations and Industries are gaining strength and momentum by applying data analytics more efficiently, the ability to access data from search engines and social sites enables organizations to formulate business strategies, and keep customer engagement satisfactory. IBM Cloudera Solutions is an example of the focus being delivered to the value and appropriate utilization of big data. +Big data can be presented in zettabytes (a unit of data information, 10^21 bytes is equal to 1 zettabyte) of unstructured and fast-moving data that can be traced or analyzed to generate business values. Thus, it is a source of long-lasting competitive advantage. Big data has been broadly divided into three - the first is structured data, which can be accessed, stored, and processed in the form of a fixed format. The Second is unstructured data, where the data is stored or processed in an unknown and unstructured form. However, a heterogeneous data source containing a combination of simple text, images, videos, etc, is also a type of unstructured big data. The third is semi-structured big data, both 'Structured and Unstructured' data come under semi-structured data. XML file data is an example of Semi-structured data, it can be found in structured form yet undefined. According to Analytics Insight, the big data industry is presently worth $189 Billion and is predicted to proceed with further growth and reach $247 Billion by 2022. Simply put, 'Digital Revolution' continues defining how industries want to see themselves and vice-versa. The disruptive character of evolution is consistently transforming decision-making and implementation processes, and curating innovation while supporting the layers seeing it through.