Digitization of business in Retail

A lot of attention devoted now to the problem of digitalization in business as an important aspect of the new paradigm formation in the entrepreneurship culture. Here are novel ideas about revolutionary changes in retail as an example: the article “Winning with digital what makes a digital leader” by Tito Arciniega, Vice President, WW Commercial Sector Industries, Enterprise & Partner Group, Microsoft Corp. Or recent Daniel Zhang’s, the CEO of Alibaba Group, presentation in Davos on “Digital tech is changing retail”. 

One of the main ideas of these authors is that technological innovations today conduce to mass transition to the new level of doing business. But it’s not happening of its own accord. Main role in this belongs to the captains of business and requires business leaders to change their own set of mind, in other words, a kind of “digitalization of the mind”. This leads to absolutely amazing ideas in business. So the founder of Alibaba Group Jack Ma proposed to create an Electronic World Trade Platform (EWTP), criticizing the WTO framework as outdated and bureaucratic. He stated that during World Economic Forum in Davos, which was received as a sensation.

I can state that digital innovations don’t restrict business but rather give companies a high chance for expansions in the markets. This would be impossible without the leaders being able to look at business from a new angle. The change from “continuous” to “digital” set of mind in retail allows to broaden opportunities for creating new goods and business models, it allows us to form relationship of manufacturer, seller and customer, customizing their requests and relations in a new way.

Why digitalization in retail is timely?

The basis for the successful development of any economy are consumer demand and the level of satisfaction of this demand. Retail as a form of business is linked with solution to these issues. Modern digital innovations are not able to pass the retail trade. And here are a lot of problems concerning technology adaptation.

But I think that the main problem of retail is “digitizing” the state of mind of the business representatives. There are a lot of companies that work as they did before, on the level of handicraft trade. And they have a long way to go before successful digitization of the mind. In this case there are two kinds of “business-species”. First are those who don’t even know that the digitization began. Second are suffering from the lack of trust in everything new. Although they realize that the sprouts of novel are pushing way, they prefer to not risk and hold a wait-and-see attitude.

What does the “digitization” brings to retail?

Nowadays digital leaders can not only grow out of traditional business-models, but they actually are planning to conquer of new market opportunities without any restrictions. That’s because for the first time in many decades technology push is getting ahead of the progress of business process innovations. The technology is no longer a barrier for the development of business, but rather opens new horizons for business. In other words, “digit” removes emerging obstacles and creates competitive advantages for companies using them first.

Digital business transformation also imposes new demands on managerial community, highlighting the ability of top managers to see emerging of a new and the ability for collective action for its implementation. It is no secret that most companies operate today in a proprietary format. But digital technologies involve the interaction of business actors, since only the shared use of them can lead to a phenomenal growth in the level of efficiency in the market, and even can give the opportunity to “take the house”.

The path to digital transformation in business cannot be only due to the capitalization of digital technology. This path requires a radical restructuring of business leader’s mentality. Digital transformation is connecting creative possibilities of the business with technical inventions, it is a combination of traditional business models and innovative digital technologies. Digital conversion is the main way of the retail market development, the way for the invention of new products and business models.

In conclusion, I would like to recall the words of Alibaba Group captain Daniel Zhang that 

“… if we could not change fast, then we would be killed by this new technology”.

Sources : Multiple Inputs from Microsoft Enterprise, Alizila, Forbes