2.4 Macro-environment: Some organizations tend to focus theiranalysis of possible future threats on specific market-related factors, yet dueto the highly varied nature of digital businesses and recent financial andpolitical tensions and conflicts that often affect many more aspects of anation, this paper reviewed more broad approaches of external factors thatmight affect technological ventures. In fact, those variables are applicable toany type of corporation.In advance, it can be said that the major general gap found in theliterature review of macro-economic factors is on big data management controls.Going beyond this essay, the possession of this information could represent theepitome of the management control world, therefore theoretical frame for itscontrol is crucial. In fact, similar claims already exist, stressing that bigdata could help with understanding the world and generating knowledge, yet itmust be treated with responsibility and ethics (Crawford, Miltner, and Gray,2014). On the other hand, the factorslisted below are uncertain by nature, so previous research has highlightedinsights and risk indicators to be aware of, but it would be wrong to point outa universal understanding.
2.4.1. Economics and Financial Climate: A business model can only be successful whenit proves its ability to generate profit. For this to occur, the price that thecustomer is willing to pay must be higher than the production cost. However,what if after a billion-dollar deal, the economic and financial condition ofthe host country does not allow the new business to accomplish that basicprinciple? In 2010, Bharti Airtel Limited, a successful leader in the mobiletelecom Indian Business closed a deal with Zain Group for $10.7 billion, forthe acquisition of businesses in fifteen African countries.
Soon after, thecompany reported low contributions from all fifteen countries, and it haddifficulties applying the business model and strategies which had kept itafloat and ahead of the Indian market. Its lack of success was due to the lowper capita income of the population, minimal infrastructure resources, diversecultures, different regulatory requirements, geopolitical risks and politicaluncertainties (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 marketleader could incur significant financial setbacks due to a weak analysis offuture projections. The financial climate might also be influenced by theglobal forces that unquestionably affect every market performance and itsability to deliver predictable outcomes. 2.4.2.
Politics and Legislation: Often governments areextremely influential in helping or preventing development and well-being. Thatis also true for the adoption of technologies and innovation in the public orprivate sector. The literature reveals cases of nation’s innovation-supportingpolicies. For instance, in Japan, France, and The United States, those plansare often characterized by political and favor-driven decisions that not alwaysare useful for the economic performance of those countries (Chaston, 2017).Also for organizations power and politics matter for the adoption of ISimplementations, even if there is resistance to change (Markus, 1983).Regarding legislation, regulations may be very diverse and depictchallenge. Regulatory instruments might be for all companies, market-specific,or product-specific. As for politics, the government might mandate the use ordisuse of products, services, and technologies, creating dilemmas forbusinesses because their achievements might depend on their ability to adaptrather than market forces (Chaston, 2017).
Thus, a product could be an overnight success or failure depending onlegislation or government influence. 2.4.3. Technology: Also,the discipline itself must be part of the analysis. Technology as a disciplineis always bringing new processes and knowledge, integrated or not, into amachine to operate. Hence, a new or old technology external to the organizationmay render an unexpected competitive advantage that they could incorporate intotheir value proposition.
Thus, it is critical to track every technologicalchange or unexploited concept, because as often had been the case for scienceand technology, in the beginning, there is no apparent practical use for aninventor. Chaston (2017) quotes O’Connor and Mark (2002) who carried outresearch with a group of companies and concluded that every time an outstandinginnovative idea is analyzed against high levels of market and technicaluncertainty, the use of the idea changed. Given this, the exploration, andre-thinking of what is established could bring new opportunities.
2.4.4. Culture: itrefers to the set of rules that shape social behavior in human society,transferred through social learning (Macionis and Gerber, 2011). It is includedin this analysis as it naturally concerns the customization of every aspect ofthe digital business model to the host country. It is a sensitive aspect thatcould negatively affect the entire operation if it is ignored.1. Value Verifiers:Aprevious study compared a group of successful digital business against a groupof previously successful businesses that did not adapt fast enough to thedigital revolution and subsequently lost prominence, and defined four”value realities” in order to emphasize the importance of goingbeyond the value proposition (Keen and Williams, 2013).
This essay will buildupon those realities, in this case, called “value verifiers”, as itshows that they will challenge the digital business models approach and willgenerate new insights that help prevent failure. This analysis is illustratedin Table 1 3.1. The value is determined bythe buyer: The buyer defines valuelevels/contributions and how offers are related.
The value is equal to buyer perception.3.2.
Value is dynamic and relative because it is anindividual choice: It relates to all the known choices, driven by forces thatinteract in the business field.3.3. Companiesleverage evolution and co-evolution: This relates to how companies increasinglyexploit the market to leverage the adaptive environments of relationshipsinstead of going alone.
3.4. Entrepreneurs will enhance existing valuepropositions and generate new dimensions of value: The entrepreneur will createor enhance ways of challenging the propositions available in the market.