Conclusion: Technology s Impact on Global Business

One thing should be clear from reading this text: the fundamental methods through which people adopt and employ technology today follow a similar pattern throughout history and, more importantly, across cultures. The advance of technology merely reflects the ability of humankind to excel at applying physical devices to increase the quality of life and the efficiency of business. What can also be observed is that technology creates a condition in which our social, moral, ethical and business values are tested, and our perception of what is valuable to society is sometimes dictated by culture and personal choice. Throughout history, technology has played an important role in shaping our society, beliefs, values and business activities by continually giving us cause to re-examine them and understand their interrelationships. Pacey reveals the paradox of our relationship with technology:

Modern man, it often seems, is divided man. There are no universally agreed goals, no wholly comprehensive systems of values: ‘the modern mind is divided – in tension’. Again and again there are attempts to resolve the tension by suggesting a rejection of high technology and reversion to a simpler, more rural way of living. But many of the finest achievements of western culture are the products either of high technology or of the virtuosity values that have impelled it. One thinks of the idealistic engineering of medieval cathedrals, the work of Renaissance artist-engineers, the constructions of Brunel and Eiffel, and the marvels of microelectronics or of space exploration. To disown all that would be both Luddite and Philistine. But to assert the importance of meeting basic human needs, and using technology to that end, is an inescapable obligation.^[171]

It is from this paradox of socio-technological behaviour that business must create a compelling value proposition to engage customers and return some reasonable degree of profit. What technologies such as the Internet bring to light is that people no longer can enjoy the insular effects of technological isolationism of the past. Although we believe in technology, our inclination is to resist it in conscious and subconscious ways.

The bureaucracies within business, for example, complicate the process of adding value by emphasizing governing activities rather than the execution of the process. One could argue that no amount of technology will resolve the fundamental problems of bureaucratic behaviour; however, technology can be employed to minimize its effects. In the 1960s, organizations developed a method of anticipating future activities called ‘strategic planning’.^[172] This form of centralized annual planning allowed firms in many cases to establish rigid operating conditions that were designed to reinforce their hierarchical organizational structures. The structures simply reflected the compartmentalization of the business processes into functional areas. Paul Strassmann observes that simply providing poorly designed structures adds little long-term value:

The amount of office work done in a bureaucracy is determined by organizational design. However, the closer one examines the details of office work the less understandable it becomes. Office work reflects the way power is distributed. Automation can be used to increase the autonomy of individuals or to strengthen the control of the hierarchy. Office automation should be attempted only after work has been simplified to respond to customer need. Productivity is improved by simplifying organizations rather than by speeding them up.^[173]

The technologies of the twentieth century have proved effective in transmitting the image of western values to all parts of the globe in a serial broadcast method such as television. The Internet, unlike previous mass media technologies, is a two-way synchronous means of communication which will facilitate a greater awareness of the cultures, morals, ethics, beliefs, religions and all other aspects of society to be freely exchanged multi-directionally. Technology’s potential lies in its ability to enable firms to conduct business globally in a competitive marketplace that continually strives for process optimization, higher quality goods and better returns for investors. This potential is realized not as a technology project aimed at improving customer services but in the creation, development and execution of the firm’s value proposition.

A benchmark for a firm’s success is not an increase in profitability, but the success of its customers. Competition acts as a catalyst for the continuous redefinition of customer’s needs, wants and desires. Technology plays an integral but not exclusive role in meeting the customers’ expectations and achieving customer centricity in our process designs. However, this transition to a business model which places the customer at the centre of a relationship requires a shift from traditional thinking, as reflected by Earle and Keen:

Here are just a few of the many implications of the difference between a business model centered on relationships and one on transactions:

• Relationship-centered business models generate very high incremental operating margins for repeat business and positive cash flows even when the firm is as yet unprofitable; in contrast, transaction-centered business models have lower infrastructure costs. Yet they must build high conversion rates – that is, build up the fraction of hits on the site that turn into purchases.

• Relationship centered business models have high risk and potentially very high payoff; in contrast, transaction-centered business models are heavily reliant on price-cutting, discounts, and payment to portals.

• Relationship-centered business models succeed when they offer a superb operational performance in fulfilment and reliability; transaction-centered business models, even when they perform superbly, remain vulnerable to online players who give away their service or goods to attract relationship business.

• Relationship-centered business models are creating new power brands; transaction-centered business models face loss of product equity to strong Internet relationship brand players.^[174]

A shift to a customer-centric perspective demands that corporations develop a clear understanding of who or what constitutes a customer and what are the associated demographic attributes to which the firm delivers value in its products. To conduct business globally, organizations will need to assess the relativity of the value propositions of their products and services with the cultural preference of indigenous people. This global proliferation of goods, services and technology generates a new set of issues which businesses must monitor. Businesses also need to develop clear and concise policies to address each matter as it gains momentum. In order to be an effective global business, organizations need to be aware of a number of issues that have been identified by the Global Internet Policy Initiative, such as: transparency, telecommunications ‘liberalization’, tariffing/universal service, technical standards/licensing, eReadiness guides, eCommerce/electronic and digital signatures, content controls/ISP liability/freedom of expression, privacy, intellectual property, cybercrime/cybersecurity, taxation of eCommerce, jurisdiction, domain names and international governance.^[175] Moreover, these issues also bring a new set of opportunities for corporations to add value.

The advance of technological innovation is greeted by society with open arms. Society will use technology for purposes that are malevolent or benevolent or both; this is the choice of people who use it. Hopefully, technology users will choose to use technology wisely and benevolently. The Internet is a two-edged sword that is a vehicle for intellectual enlightenment through cultural exploration and at the same time exposes and magnifies the darker side of human behaviour. It is the ultimate representation of humankind’s conundrum of gaining consensus in a world of celebrated differences, and portrays the human spirit at its worst and its best. Business technology’s express goal is the same now as it was in the time of the Medici: to make operations more profitable and facilitate commerce between all parts of the world. The incorporation of new technologies into corporate value propositions is inevitable and must be now achieved by the proactive determination of senior managers who can lead business into a connected global environment. In this environment, business processes will ultimately be part of a synergistic socio-economic relationship linking cultures, not devouring them.

^[171]A. Pacey, The Culture of Technology (Oxford: Blackwell, 1983) p. 120.

^[172]M. Hammer. Beyond Reengineering: How the Process-Centered Organization is Changing Our Work and Our Lives (London: HarperCollins, 1998) p. 210.

^[173]P. Strassmann, Information Payoff: The Transformation of Work in the Electronic Age (London: Collier Macmillan, 1985) p. 242.

^[174]N. Earle and P. Keen, From .com to .profit. Inventing Business Models that Deliver Value and Profit (San Francisco: Jossey-Bass, 2000) p. 11.

^[175]Global Internet Policy Initiative, available at: http://www.gipiproject.org.