Regardless of sector, the majority of the top value generators in recent years have one thing in common: technology is crucial to their business. The clear message is that technology is more than simply an enterprise. It has emerged as the dominant transformative factor in the global economy.
Technology is fueling most of the growth across the global economy.
"Born tech" firms purposefully developed their businesses around technology from the beginning because they saw it as crucial to their success, even if their final result isn't a typical technology product or service. Consider Tesla in the vehicle industry, Netflix in the media industry, and Amazon in retail. However, even more traditional, frequently non-tech firms, have recognised the enormous benefits of a tech-led strategy. Disney, for example, offers a streaming movie service, and several retail stores now have massive online marketplaces. This tendency extends beyond digital transformation programmes, which frequently focus on digitising analogue processes. This is about knowing how to use technology and the tech industry's platform and ecosystem playbook to get a competitive edge.
The tremendous worldwide success of cloud technology and platform business models has propelled the value creation of the IT sector over the last decade. These two movements spawned the digital titans, the main cloud tools and service providers known as "hyperscalers": Alphabet, Amazon, Apple, Facebook, and Microsoft in the United States, and Alibaba and Tencent in China. Cloud technologies and platform business models are already delivering enormous value for businesses in every industry. The capacity to fully use these accelerators will determine the winning firms of the future decade.
Cloud-native infrastructure software Cloud-native infrastructure software firms have thrived because they can quickly develop and swiftly scale out new applications by building them on top of the public cloud resources of the main cloud service providers. Rather than incurring large upfront capital expenditures, cloud-native infrastructure software firms can pay for cloud computing resources on a per-use basis. This allows companies to focus their spending on product development, sales, marketing, and other areas where their firms may expand.
Snowflake has used this model to become one of the fastest-growing and most valuable cloud-native infrastructure software firms. The company created a platform that runs on different public clouds and assists organisations in consolidating diverse data sets so that they can more easily analyse and exchange data, as well as construct data-enabled apps.
Nontech firms and the cloud As cloud infrastructure and accompanying technologies progress, they enable businesses across sectors to not only construct more efficient and effective IT footprints, but also to leverage massive volumes of data to improve their business model.
Automobile manufacturers, for example, are expanding car telematics services based on cloud technology. This can increase consumer safety and vehicle enjoyment while also lowering total automobile ownership costs.
Nontech companies and platforms Platforms are typically linked with the technology industry, but firms in other sectors are shaking up their markets by implementing business models based on technology platforms. The term "platform" is frequently used in a broad sense. We use it explicitly in this context to refer to a product or service that draws on an ecosystem of partners and customers that together produce value. The' power of platforms is derived from their network effects, which reduce marginal acquisition costs and generate compounding improvements in value for the platform and its participants. For instance, for Godrej Nature's Basket, the food store chain owned by the Godrej Group, the acquisition of online grocery store Ekstop helped them grow their business.
Embracing Technology Companies are investing in IT personnel to fully capitalise on cloud technology and platform business models. For a clear picture of how CEOs across industries are changing their firms with technology, look no farther than Goldman Sachs. The financial services industry situated in the United States today employs more software developers (10,000) than the majority of technology firms. Coders account for around 25% of its employees.
The expenses of technology have now surpassed the regulatory costs of conducting business. With each new investment in technology comes a near-constant overhead of maintenance expenses, change management costs, license fees, and personnel expenditures. No-code platforms like Bubble, Webflow, Adalo, Makerpad , etc., introduce the notion of technological democratisation. They enable a huge number of individuals to leverage their experience, business knowledge, and subject expertise to build essentially limitless technology-enabled applications. With no-code platforms, the barrier between access to and creation of technology may be completely removed.
The question on every boardroom table, regardless of industry, is not whether technology can help the firm. It's a question of how and to what extent. Companies that embrace technology as a fundamental, defining asset stand to gain more than ever.