Digital Business Fundamentals: Models, Strategies, and Systems
Drivers of Digital Business
Digital business is driven by multiple forces that push organizations to adopt digital technologies:
- Market Forces: Increasing competition and globalization, demand for better customer experience, and the need for faster product delivery.
- Technology Forces: Advancements in AI, Cloud, Blockchain, and Data Analytics; increased internet penetration; and mobile platforms enabling new business models.
- Economic Forces: Need for cost reduction and efficiency, economies of scale
Strategic Management: Porter’s Frameworks and Competition
Michael Porter’s Value Chain Analysis
The Value Chain is a tool used to identify where a company creates value for its customers and where it can find a competitive advantage. It divides a firm’s activities into two categories:
Primary Activities
These are directly involved in the physical creation, sale, and service of the product:
- Inbound Logistics: Receiving and storing raw materials.
- Operations: Transforming inputs into final products.
- Outbound Logistics: Distributing the product to customers.
- Marketing
Blockchain and Lean Systems in Supply Chain Management
Blockchain Technology in Supply Chain
Blockchain is a tool used to build a shared story. As a decentralized system, it is useful for creating a shared record of events. Once recorded, data cannot be changed. It encompasses various models, including decentralized, distributed, centralized, public, and private systems. This innovative technology enhances customer service and increases efficiency by creating shared and secure data records.
Benefits to Supply Chain Management (SCM)
- Advanced Traceability:
Essential Business and Employment Vocabulary Glossary
Financial Statements and Cash Flow
- Cash flows from operating activities: The net amount of cash a company generates or spends from its core business operations.
- Revenue (cash received from customers): The total money collected from clients in exchange for goods sold or services provided.
- Merchandise inventory: The stock of finished goods that a business has on hand and intends to sell to customers.
- Personnel costs: All expenses related to employees, including salaries, wages, social security, and benefits.
Uber Strategic Analysis: Business Model and Competitive Edge
Mission and Vision
Mission: Create opportunity through movement.
Vision: Reimagine how the world moves, improving urban mobility and driving sustainability (zero-emissions by 2040).
Value Proposition
Value Creation: Digital platform providing fast, reliable, and convenient on-demand transportation and delivery.
Customer Value: Immediate access | Reduced waiting time | Easy-to-use app | Transparent pricing and availability.
Driver Value: Flexible income opportunities | Access to a large customer base |
Essential Financial Analysis and Investment Strategies
Industry Analysis and Porter’s Five Forces
Industry analysis is the process of evaluating the structure, trends, competition, and profitability of an industry to determine its attractiveness for investment. It helps in understanding the growth potential, risk, and competitive position of firms.
Objectives
- Identify profitable industries
- Analyze demand-supply conditions
- Understand competition
- Evaluate future growth
Key Factors
- Demand & Supply: Growth and consumption trends.
- Growth Rate: High growth indicates