Digital revolution, also referred to as the 4th industrial revolution, is bringing extraordinary opportunities for startups and tech-savvy companies, but what about the established businesses? Are they going to follow the trend or are they going to die a natural death? Some researchers predict that, in contrast to startups, existing companies will experience a lot of threats caused by digitization (Weill, Woerner, 2015). These can be as simple as the fact that the given product or service is needed anymore. When I think about it, an example that always comes to my mind are the tech repair shops. I still remember that when I was younger and our TV or computer broke, we would always take it to a local repair shop to fix it. Nowadays, when something breaks, eighty percent of time, the item is just simply not fixable anymore and one needs to buy a new one. I think in a few years, people would not even bother trying to fix their broken gadgets.
On the other hand, some threats are much more complicated and much harder to tackle by companies. In my opinion, this is caused by the fact that for the companies they were (and are) very much unexpected. Let’s take as an example a long-established banking industry. Up till few years ago, when faced with fintechs, banks did not expect any threat to challenge them in any near or far future (Brown, 2019). If the digital trend continues (and it most certainly will), in few years the banks as we know them might not be needed at all anymore (Weill, Woerner, 2015).
What I think is very interesting to see is how people slowly tend to start trusting familiar apps on their phone more than their bank advisors. Were banks not supposed to be, by default, institutions of public trust? Nowadays people (and I probably also fall into this group sometimes) allow Facebook (or any other app) to access information on their iPhone (which is ultimately the central database of our lives) without much thought. However, when it comes to signing a document in a traditional bank we tend to be a bit distrustful.
To many of us, the fact that Chinese giant WeChat gathers personal, behavioral and financial information about its users seems comparable with Orwell’ s utopian Oceania (Orwell, 1949). But if we don’t change our habits, using Facebook instead of a traditional bank may not seem as such a distant future (Mearian, 2019).
Works Cited:
Brown, J. C. (2019, January 03). Automation will be the end of banks as we know them. Retrieved September 2019, from TechCrunch: https://techcrunch.com/2019/01/03/automation-will-be-the-end-of-banks-as-we-know-them/
Mearian, L. (2019, June 18). Facebook is going into the banking business with blockchain. Retrieved September 2019, from Computerworld: https://www.computerworld.com/article/3403342/facebook-is-going-into-the-banking-business-with-blockchain.html
Orwell, G. (1949). 1984. London: Secker and Warburg.
- Weill, S. L. Woerner. (2015, June 16). Thriving in an Increasingly Digital Ecosystem. MITSloan, 56(4), 27.
