COMPANY THAT HAS NEW DIGITAL ECONOMY

COMPANY THAT HAS NEW DIGITAL ECONOMY

v  DEFINITION OF NEW DIGITAL ECONOMY

1.      According to wikipedia Digital economy refers to an economy that is based on digital computing technologies. The digital economy is also sometimes called the Internet Economy, the New Economy, or Web Economy.

2.      According to Australian Government, new digital economy is the global network of economic and social activities that are enabled by information and communications technologies, such as the internet, mobile and sensor networks. This includes conducting communications, financial transactions, education, entertainment and business using computers, phones and other devices.

3.      According to Thomas Mesenbourg (2001), three main components of the 'Digital Economy' concept can be identified:

·         E-business infrastructure (hardware, software, telecoms, networks, human capital, etc.),

·         E-business (how business is conducted, any process that an organization conducts over computer-mediated networks),

·         E-commerce (transfer of goods, for example when a book is sold online).

v  COMPANY BACKGROUND

Amazon was founded in 1994 by Jeff Bezos. Bezos left his employment as vice-president of D. E. Shaw & Co., a Wall Street firm, and moved to Seattle. He began to work on a business plan for what would eventually become Amazon.com. In September 1994, Bezos purchased the URL Relentless.com and briefly considered naming his online store Relentless, but friends told him the name sounded a bit sinister. The company went online as Amazon.com in 1995. Bezos selected the name “Amazon” by looking through the dictionary. "Amazon" was a place that was "exotic and different" just as he planned for his store to be.

v  COMPANY AND NEW DIGITAL ECONOMY

Amazon is an American electronic commerce and cloud computing company, founded on July 5, 1994, by Jeff Bezos and based in Seattle, Washington. It is the largest Internet-based retailer in the world by total sales and market capitalization. Amazon.com started as an online bookstore, later diversifying to sell DVDs, Blu-rays, CDs, video downloads/streaming, MP3 downloads/streaming, audiobook downloads/streaming, software, video games, electronics, apparel, furniture, food, toys, and jewelry.

Today’s digital field allows firms to quickly become global competitors. Unlike most traditional companies in advanced economies whose growth strategies are difficult to become the big competitors for the others companies.

Amazon’s technology today is very good. Amazon applies new digital economy to the business itself in order to wider the market and increasing the revenue by considering the cost. The company also produces consumer electronics, Amazon Kindle e-readers, Fire tablets, and Fire TV(the world's largest provider of cloud infrastructure services). Amazon also sells certain low-end products like USB cables.

To operate in a fast-changing marketplace, firms are moving away from strict hierarchical decision-making and closer to a network structure that is more market-like and organic, not unlike the internet itself. The challenge for today is to create an organization that maintains the advantages of size to stay ahead of competitors.

Although the benefits will be significant, applying digital technology to the business and come up with new digital economy won’t be easy. There are indication that the complexity of existing infrastructure makes transformation impractical and firms lack the visionary skills to define the right strategy.

As the digital economy expands, not only Amazon that can implement new digital technology to the business but all firms can implement and create new digital economy. For sustaining the business from the competitors there are a number of actions that should be considered to succeed in a future with uncertainty:

1.      Remember that every company today can be a digital competitor.

Advances in cloud computing have made technology far more accessible, both for customer-facing and back-office operations. It is no longer necessary to make massive investments in proprietary systems. The rise of on-demand computing has greatly reduced the capital costs. Be prepared for small companies that can compete by leveraging new hardware and software with minimal fixed investment.

2.      Think innovatively about innovation

Innovation is no longer just about making new discoveries. In a global economy, companies need to re-evaluate the way they approach product and service development. Executives may discover new approaches to organization and process innovation to cut costs and boosted sales. Such thinking can drive greater efficiencies and performance across the firm.

3.      Embed social media into all parts of your business

Many executives still do not understand the various uses of social media. Social media is a versatile tool that can improve product development, facilitate internal collaboration, mitigate risks and boost customer sales and retention. In today’s networked environment, customers follow the advice of online colleagues far more readily than corporate marketing messages.