People have been doing business over the ages with the increased realization of how money can impact a country’s economy and quality of life. We can trace it back 3,000 years to India and China, where companies – with structures resembling sole proprietorships, partnerships, and corporations. At this time, they began entering into contracts and owning property, essentially setting up the basic frameworks of business that we use today. 

As traditional business owners, they strive to run their companies 100% debt free and not to turn to venture capital or “Sharks.” they prepare and purchase everything needed, from getting a building or store to filling up their inventory and hiring staff to buy infrastructures. They stop counting working hours and get serious about working full time to earn more, develop, expand, and grow more companies or stores. They don’t look at hourly rate but their return, business, and vision. It becomes a norm to lose sleep, and a balanced life is not a thing anymore. Yet it does not mean they cannot correctly manage or live their desired lives, but just that their priorities have shifted.

However, the advancement of technology has transformed businesses from setting up brick-and-mortar stores to serving people locally by providing services or products to people sitting in any corner of the world, scrolling through the web, and availing the company’s services and products.

In this digital age, technology has shifted business emphasis to digital sources of revenue and multiple uses of digital channels to strengthen brand image, generate more leads and boost sales. The digital business allows people to create income or performance in ways that were impossible with traditional models. More organizations use technology to continuously upgrade all aspects of their business models, from what it offers and interact with customers to how it operates. As technology evolves, so does the business. It is not just substituting old tools with new, digitalized ones. It involves holistic change regarding technology and how people think about leveraging the technology that can lead to more sustainable outcomes and solutions.

We can see that business transforms digitally in four main areas:

1. Core operations: a transformation from physical to digital, taking a new approach to what value to deliver and how
2. Experience: reshaping the customer/partner and employee experience using a solid and effective experience-feedback mechanism
3. IT infrastructure: adoption of available cloud-based tools to operate software, build and seamlessly integrate new applications, store/retrieve data, and compute
4. Information management and analytics: building a data-driven organization where decision-making relies heavily on insights obtained from gathered data

Digital transformation enables a company to remain competitive, adapt to ever-changing industries, continually improve its operations, and seek ways to improve the end-user experience. Using the right technology can significantly improve how our business functions and customer engagement.

Digital businesses grow with the growth of the digital economy. As people are spending more money online and becoming more familiar with digital products and services, it drives more companies to seek new competitive advantages in the digital space and evolve into more than selling online, creating new value and experience and doing things that others cannot do with the use of unique combinations of digital and physical resources. We must note that digital business is not to be regarded as e-business where the latter typically use technology to gain efficiency or eliminate redundancies but not to create new value, leaving the existing business model unchanged.

Examples of Digital Business

Uber

Uber, which is now much more than just a ridesharing company, utilizes a business model that offers a better value proposition to passengers and drivers while maintaining relatively low capital assets with the use of technology. 

It creates value, solves the lack of transportation services in some countries, and provides more job opportunities. It has also become a revolutionary business model widespread globally and adopted by many due to its business structure flexibility.

Netflix

Switching from e-business to digital business, Netflix, once used to mail people DVDs and manage inventory, provides a more convenient experience similar to movie rental stores, now allows people to enjoy movies and TV shows anytime, anywhere.

Disney

Disney, one of the traditional businesses, embraced digital technology to enhance experiences in its theme parks. The introduction of MagicBand improved five key Park experience elements:

• Destination Arrival
• Hotel Stay
• Restaurant Dining
• Memories Photo Taking and Sharing
• Souvenir Purchase

It can provide an experience that moves fluidly between digital and physical to the guests, where the MagicBand, a wristband that uses RFID and radio to connect with sensors in the park, was given a few weeks before the visit. Guests can then use it to enter the park, buy food or merchandise, reserve attractions, and watch real-time data on wait times.

Digital transformation in business can be more than just an opportunity for process improvement and cost efficiency. It can be a matter of survival and operational continuity when a crisis such as COVID-19 closes down traditional business channels and impedes much of the growth of conventional businesses in 2020. It helps business continuity, and businesses suffer less disruption when facing pandemics or disasters — from hurricanes and floods to earthquakes and fires.

The growth of businesses online can be seen in four different online engagement levels:

Basic Digital Engagement Level

Business involves traditional marketing methods such as newspaper/magazine

advertisements, radio ads, or direct mail. Hardly used or may be unfamiliar with modern marketing tools or social media. Their only digital tool may be their business email address.

Intermediate Digital Engagement Level

Possess an essential website without e-commerce features or participating in any

third-party marketplaces.

High Digital Engagement Level

Websites are slightly more advanced, equipped with online booking and e-commerce facilities — utilization of social media tools and other digital marketing channels to enhance business.

Advanced Digital Engagement Level

Use more sophisticated or advanced digital tools, from developing a mobile application to using data analytics to understand customer preferences or sales-oriented details.