2.4 Macro-environment: Some organizations tend to focus their
analysis of possible future threats on specific market-related factors, yet due
to the highly varied nature of digital businesses and recent financial and
political tensions and conflicts that often affect many more aspects of a
nation, this paper reviewed more broad approaches of external factors that
might affect technological ventures. In fact, those variables are applicable to
any type of corporation.
In advance, it can be said that the major general gap found in the
literature review of macro-economic factors is on big data management controls.
Going beyond this essay, the possession of this information could represent the
epitome of the management control world, therefore theoretical frame for its
control is crucial. In fact, similar claims already exist, stressing that big
data could help with understanding the world and generating knowledge, yet it
must be treated with responsibility and ethics (Crawford, Miltner, and Gray,
2014). On the other hand, the factors
listed below are uncertain by nature, so previous research has highlighted
insights and risk indicators to be aware of, but it would be wrong to point out
a universal understanding.
Economics and Financial Climate: A business model can only be successful when
it proves its ability to generate profit. For this to occur, the price that the
customer is willing to pay must be higher than the production cost. However,
what if after a billion-dollar deal, the economic and financial condition of
the host country does not allow the new business to accomplish that basic
principle? In 2010, Bharti Airtel Limited, a successful leader in the mobile
telecom Indian Business closed a deal with Zain Group for $10.7 billion, for
the acquisition of businesses in fifteen African countries. Soon after, the
company reported low contributions from all fifteen countries, and it had
difficulties applying the business model and strategies which had kept it
afloat and ahead of the Indian market. Its lack of success was due to the low
per capita income of the population, minimal infrastructure resources, diverse
cultures, different regulatory requirements, geopolitical risks and political
uncertainties (Dwesar, 2011).
Bharti Arirtel Limited is still an important player in the industry.
Yet, their case taught us that the economic factor matters and even a market
leader could incur significant financial setbacks due to a weak analysis of
future projections. The financial climate might also be influenced by the
global forces that unquestionably affect every market performance and its
ability to deliver predictable outcomes.
Politics and Legislation: Often governments are
extremely influential in helping or preventing development and well-being. That
is also true for the adoption of technologies and innovation in the public or
private sector. The literature reveals cases of nation’s innovation-supporting
policies. For instance, in Japan, France, and The United States, those plans
are often characterized by political and favor-driven decisions that not always
are useful for the economic performance of those countries (Chaston, 2017).
Also for organizations power and politics matter for the adoption of IS
implementations, even if there is resistance to change (Markus, 1983).
Regarding legislation, regulations may be very diverse and depict
challenge. Regulatory instruments might be for all companies, market-specific,
or product-specific. As for politics, the government might mandate the use or
disuse of products, services, and technologies, creating dilemmas for
businesses because their achievements might depend on their ability to adapt
rather than market forces (Chaston, 2017).
Thus, a product could be an overnight success or failure depending on
legislation or government influence.
the discipline itself must be part of the analysis. Technology as a discipline
is always bringing new processes and knowledge, integrated or not, into a
machine to operate. Hence, a new or old technology external to the organization
may render an unexpected competitive advantage that they could incorporate into
their value proposition. Thus, it is critical to track every technological
change or unexploited concept, because as often had been the case for science
and technology, in the beginning, there is no apparent practical use for an
inventor. Chaston (2017) quotes O’Connor and Mark (2002) who carried out
research with a group of companies and concluded that every time an outstanding
innovative idea is analyzed against high levels of market and technical
uncertainty, the use of the idea changed. Given this, the exploration, and
re-thinking of what is established could bring new opportunities.
refers to the set of rules that shape social behavior in human society,
transferred through social learning (Macionis and Gerber, 2011). It is included
in this analysis as it naturally concerns the customization of every aspect of
the digital business model to the host country. It is a sensitive aspect that
could negatively affect the entire operation if it is ignored.
previous study compared a group of successful digital business against a group
of previously successful businesses that did not adapt fast enough to the
digital revolution and subsequently lost prominence, and defined four
“value realities” in order to emphasize the importance of going
beyond the value proposition (Keen and Williams, 2013). This essay will build
upon those realities, in this case, called “value verifiers”, as it
shows that they will challenge the digital business models approach and will
generate new insights that help prevent failure. This analysis is illustrated
in Table 1
3.1. The value is determined by
the buyer: The buyer defines value
levels/contributions and how offers are related. The value is equal to buyer perception.
Value is dynamic and relative because it is an
individual choice: It relates to all the known choices, driven by forces that
interact in the business field.
leverage evolution and co-evolution: This relates to how companies increasingly
exploit the market to leverage the adaptive environments of relationships
instead of going alone.
Entrepreneurs will enhance existing value
propositions and generate new dimensions of value: The entrepreneur will create
or enhance ways of challenging the propositions available in the market.