Assessing Changes in the Business Environment The Relationship between Businesses and the Technological Environment There are two options, adapt or die. Andrew S Grove Just as ‘location, location, location’ defines value in real estate, in business today it’s connectivity that equals competitiveness. Mary Cronin BUSS4.5 Technological Environment

In this topic you will learn about Assessing the effects of technological change Evaluating the response of businesses to technological change YouTube Eddie Izzard-Technology Does society embrace technology? BUSS4.5 Technological Environment

Technological change It is the diffusion or spreading of technological change through society that impacts upon business behaviour. What has the impact of some of these technological changes been on modern businesses? Intranet Internet Social Networking CAD/CAM Robotics Handheld computers Software packages e.g. DTP, spreadsheets, databases etc “Technological change is a term that is used to describe the overall process of invention, innovation and diffusion of technology or processes.” Wikipedia Consider how these technologies can help a business across all functional areas BUSS4.5 Technological Environment

Changes in the Technological Environment Technology is the use of scientific discoveries in a practical way. We make use of technology on a daily basis in all walks of life. Technology has impacted upon business operations in a number of areas: BUSS4.5 Technological Environment 4

Changes in the Technological Environment Marketing Opportunities New markets – using the internet for globalised markets Data bases – developing sophisticated methods to target new market segments Does Internet shopping attract new customers in a domestic market or just switch shopping habits? What is the relationship between loyalty cards and databases? How are loyalty cards used as marketing opportunities? BBC Web boosts Christmas sales Shopping on the internet increased last month, boosting overall retail sales just before the pivotal Christmas season. Internet shopping sales up 50% Online shopping sales are up 50% in December as people choose to stay at home and shop over the internet. Guardian The card up their sleeve It sounds good - loyalty cards entitle us to freebies or cash simply for shopping at our local superstore. Of course, retailers get something in return: a heap of information about us we might prefer them not to know. That's before they get started on the new tags that track you and what you buy. Rachel Shabi investigates Customers fail to redeem loyalty points Two in every three shoppers in Britain own a loyalty card but many customers are not bothering to redeem their points. Who benefits from loyalty cards, the “loyal” customer or the business? BUSS4.5 Technological Environment 5

Changes in the Technological Environment Marketing Opportunities Charging higher prices for the latest technological updates creating a product with a USP or high added value through technological advancements allows a business to charge premium prices New methods of marketing – social networking and viral marketing Youtube Cadbury Eyebrows (official version) Lily Allen Does the Cadbury Eyebrows | The Sunday Night Project | Channel 4 Cadbury’s have gone world wide with its viral marketing campaign – using the internet and social networks to create word of mouth. Even Lilly Allen has got in on the act! BUSS4.5 Technological Environment 6

Changes in the Technological Environment The culture of the business Traditional cultures – these will find it harder to accept new means of communication Power culture – information will remain with the few who have power in the firm Task culture – new technology is ideal for cooperation between departments Entrepreneurial culture – technological development and the spirit of risk taking are closely linked Culture will be studied in more detail in BUSS4.10 BUSS4.5 Technological Environment 7

Changes in the Technological Environment The processes and systems used within the business New methods of production – being more capital intensive can speed up production, making it cheaper and more accurate (see Unit 2.12 for more on types of technology) Stock management – highly sophisticated systems are in place to deal with the efficient management and delivery of stock Information – increasingly, firms are replacing internal systems in order to deliver information. Information overload is a common concern in the workplace! BBC Technology set to change schooling A technological revolution is sweeping through the UK's classrooms - making pens and paper things of the past. Going online, on holiday New technology is so portable you can be in your office virtually anywhere, even whilst on holiday. Are paperless schools a thing of the future? What about paperless offices? How has technology affected expectations of workers? BUSS4.5 Technological Environment 8

Activity – Woolworths reborn online Visit the new Woolworths online website www.woolworths.co.uk Watch the BBC video clip about the re launch of Woolworths What are the advantages to Woolworths of operating on the Internet? What will be the key factors affecting the success or failure of Woolworths online? Do you think the reincarnated Woolworths will survive in the medium term? Justify your answer. BBC Woolworths name reborn online Consumers are going to be able to shop at Woolworths again, but this time only on the internet. BUSS4.5 Technological Environment

Essay In April 2008 The Independent reported “Internet sales have hit an all-time high in the UK as price-conscious shoppers shun the high street in lieu of bargain-hunting online.” Consumers in the UK can now buy almost anything online from their weekly shopping to second hand cars and discount flights. With reference to businesses you have studied to what extent do you consider internet retailing to be the key to business success in the 21st century? BUSS4.5 Technological Environment