Challenges and Opportunities of Digital Transformations in the Economy

Keywords: digital economy, digitalization, globalization, competition, innovations.

Abstract

The article gives accounts of change taking place in the economy under the impact of digital transformations. The article’s objective is to highlight opportunities and threats in the operation of economic entities at various levels, caused by the development of digital economy, with outlining potential ways of effective management of this change.

It is argued that digitalization is capable to radically transform the economy. Core characteristics of the digital economy are analyzed, and the most significant economic effects from digitalization are highlighted: the increasing labor productivity and employment, the increasing effectiveness of markets, the increasing quality of existing goods and services and the growing output of newly created ones. The essential principles to be met by government offices in order to maximize domestic benefits from the digital revolution are determined.

Digitalization effects are analyzed at industry level, with outlining the categories of industries more and less exposed to digital transformations. At company level, opportunities and threats for individual companies, essential problems related with their adaptation to new conditions, and main features of leader companies are determined. Changes in the activities of individuals, triggered by digitalization, are described.

It is concluded that while the digital economy decreases the significance of traditional production factors, qualities like flexibility, adaptability, creativity, innovativeness, orientation on knowledge and learning lifelong become crucially important.   

Downloads

Download data is not yet available.

References

1. OECD Digital Economy Outlook 2017. OECD Publishing, Paris, 2017. 324 р. Retrieved from https://www.oecd.org/internet/oecd-digital-economy-outlook-2017-9789264276284-en.htm.
2. Digital Economy Report 2019. United Nations Publications, 2019. 194 р. Retrieved fromhttps://unctad.org/en/PublicationsLibrary/der2019_en.pdf.
3. Goodwin Т. The battle is for the customer interface. Retrieved from https://techcrunch.com/2015/03/03/in-the-age-of-disintermediation-the-battle-is-all-for-the-customer-interface/.
4. Potts B. 5 characteristics of the digital economy and what it means for O&G. Retrieved from https://blogs.sap.com/2016/03/08/5-characteristics-of-the-digital-economy-and-what-it-means-for-og/.
5. Tapscott D. (2014). The digital economy: rethinking promise and peril in the age of networked intelligence. McGraw Hill Professional.
6. Atkinson R. D., McKayA. S. Digital prosperity: understanding the economic benefits of the information technology revolution. Retrieved from https://itif.org/publications/2007/03/13/digital-prosperity-understanding-economic-benefits-information-technology.
7. Global flows in a digital age: How trade, finance, people, and data connect the world economy. McKinsey Global Institute, 2014. 167 p.
8. Grossman R. The industries that are being disrupted the most by digital. Harvard Business Review. March 21, 2016. Retrieved from https://hbr.org/2016/03/the-industries-that-are-being-disrupted-the-most-by-digital.
9. Bughin J., Catlin T., Hirt M., Willmott P. Why digital strategies fail. McKinsey Quarterly. January 2018. Retrieved from https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/why-digital-strategies-fail.
10. Anderson L., Wladawsky-Berger I. The 4 things it takes to succeed in the digital economy. Harvard Business Review. March 24, 2016. Retrieved from https://hbr.org/2016/03/the-4-things-it-takes-to-succeed-in-the-digital-economy.
11. Olanrewaju T., Smaje K., Willmott P. The seven traits of effective digital enterprises. Retrieved from https://www.mckinsey.com/business-functions/organization/our-insights/the-seven-traits-of-effective-digital-enterprises.
12. Howells R. 4 supply chain strategies to drive digital transformation. Forbes. April 17, 2018. Retrieved from https://www.forbes.com/sites/sap/2018/04/17/4-essential-technologies-powering-the-digital-supply-chain/#f2ee7c469a18.

Abstract views: 285
PDF Downloads: 190
Published
2019-12-31
How to Cite
ARTEMIEVAІ. (2019). Challenges and Opportunities of Digital Transformations in the Economy . Scientific Bulletin of the National Academy of Statistics, Accounting and Audit, (4), 66-73. https://doi.org/10.31767/nasoa.4.2019.06