Firms exists because of transaction costs, which limit the efficiency of markets (Ronald Coase 1937; Nobel prize winner). Technology and in particular digitalization is reducing transaction costs and allows more efficient markets, which in turn has disruptive impact on whole industries. Amazon, Alibaba, Uber, and many others are just examples of a larger fundamental trend.
Diminishing costs of creating, transferring and analyzing data allows the creation of more granular and dynamic market structures. Micro and specific use transactions (e.g. locational, time-of-use) are now possible to analyze and can be efficiently transacted. This enables new business model and the need for sophisticated data analytics. Decisions are getting quantified.
Diminishing costs of creating, transferring and analyzing data allows the creation of more granular and dynamic market structures. Micro and specific use transactions (e.g. locational, time-of-use) are now possible to analyze and can be efficiently transacted. This enables new business model and the need for sophisticated data analytics. Decisions are getting quantified.
Successful business models are spreading faster and developments in logistics and connectivity increase global competition. As locational barriers diminish, there are increasingly few global winners in certain sectors. Only the most competitive and innovative companies will succeed increasing stress on less efficient companies but also open high growth opportunities for others.
Speed and complexity requires firm to develop complex ecosystems between customers and suppliers (or supply customers). Technology acceleration creates the need but also enables the opportunity for efficient partnerships.
Speed and complexity requires firm to develop complex ecosystems between customers and suppliers (or supply customers). Technology acceleration creates the need but also enables the opportunity for efficient partnerships.