Introduction to the advantages and disadvantages of new technologies

4.1.1 Types of new technologies

New technologies are affecting all areas of life and all sectors. Nowadays, new technologies rely on digital solutions, which means that digitalisation allows more aspects to be represented using an electronic medium and introduces changes to the business. Therefore, digitalisation in e-commerce implies taking a business one step further, into the digital space. SMEs and start-ups are especially adaptable to the introduction of new technologies, which gives them a competitive advantage over larger companies, which need more time to consider and implement selected ICT solutions.

New technologies are disrupting the way businesses operate, i.e. introducing innovation in the form of new concepts, ideas or solutions that will support development. Disruptive technology makes previous technology that was used in a business obsolete, thus initiating the acceptance of new ICT solutions to boost performance.

SMAC (Social, Mobile, Analytics, Cloud) technologies are applicable in various industries, supporting the transition of businesses to digital businesses. However, it is the integration of all of these technologies that facilitate business development and drive innovation.

Social: this refers to social media platforms, which are an effective way to reach, interact with, target, acquire and maintain customers, as well as social technologies that make social interaction possible e.g. VoIP service. The familiarity with and presence in social media is necessary for those businesses that want to remain online.

Mobile: this relates to mobile technologies and platforms, which have changed the way individuals communicate, work or shop. The e-commerce shift to mobile phones has been strongly influenced by social media.

Analytics: this relates to data which enables an understanding of how individuals behave online. Data analytics can mean a variety of things, concerning different indicators, and can also predict future behaviour, thus it should be a priority, especially in e-business.

Cloud: this relates to cloud computing, offering a new way to store data, but also to access technology and the data anyone needs, either the business or a customer who has been granted access. Clouds also facilitate system backup and system monitoring.

Some other (disruptive) technologies as of 2020 include:

Fifth-generation wireless technologies (5G). This is next generation wireless Internet connectivity, using a variety of spectrum bands, which increases downloading and uploading speed, so that data is transmitted more efficiently.

Artificial Intelligence (AI). Businesses can take advantage of AI, e.g. using voice / facial recognition or analysing data to make predictions. AI is based on computer algorithms that are recognised by companies to foster not only supply chain management, but also decision support technologies with an increasing role in the future of e-commerce.

Virtual Reality (VR). With this disruptive technology, reality is entirely replaced with the computer-generated simulation of a three-dimensional image or environment, so the user does not interact with the real world.

4.1.2 Advantages of using new technologies

Some of the advantages of using new technologies are as follows:

Communication. Digitalisation offers a new means of communication and faster technologies. This includes hosting meetings online, virtual walks, cloud sharing etc. which all save time and allow companies to take advantage of the global network and stay in touch with clients. This also improves internal communication through the use of collaboration platforms or by customer relationship management systems.

Connectivity. Wireless networking technology (Wi-Fi) is the main communication mechanism providing connectivity, especially to mobile devices. More network users are assessing it via smartphones and tablets, which supports real time communication and staying connected. Connectivity is the need to remain in contact and new technologies make it possible.

Accessibility. The Internet provides better accessibility to information and simplifies research or enhances enriching knowledge. It is usually the place to refer to on matters that require quick responses or to compare information.

Possibilities. New technologies bring innovation to different sectors, e.g. medicine or automotive, and introduce solutions that would not be possible without the support of technology e.g. sensors.

Productivity. Computers and automatisation processes have allowed companies to collaborate more effectively, regardless of location, and the adaption of new digital devices to assist in training on the job, supporting workplace activities and monitoring performance indicators.

Data storage. Cloud storage is a particularly useful solution enabling files and folders to be stored in virtual spaces, accessed by multiple users and shared across networks. Businesses can also install dedicated links on their websites to make catalogues of products available, for example.

Costs. Technologies, although they are usually associated with high investment costs, can reduce businesses expenses in the long run. Once the communication and productivity in companies is supported by new technologies, a reduction in staff costs and travel will occur, for instance.

Time. Information technology supports storage and analysis. Documents that are stored in a database are easier to find, thereby easier to analyse and provide fast answers in terms of where to introduce improvements to the business based on analysed data.  Data exchanges are faster also across the Internet. But also, individuals can save more time when robots or other Internet of Things (IoT) technologies take over their duties e.g. 3D printing of prototypes.

Precision. Technology enables the performance of tasks with more precision and a higher degree of accuracy. This is especially connected with better data analysis and providing exact amounts of information in the context of ICT.

Promotion. The Internet is the first place where a company can speak about its business and its products/services due to its pervasiveness and increased potential to reach audiences on an international level. With the incorporation of various technologies such as VR, AR, 3D and 360-degree views, or even simple solutions like videos or attractive graphics, businesses can replace text only content marketing with new ways of online promotion.

Sales. Technology has enabled online sales, which impacts domestic and international trade. More customers prefer e-shops to traditional stores, where they are not limited by time and in most cases have the same options to choose from. Tourism is also a sector that benefits from online sales, where product offerings can be easily compared online.

Payment. New ways of purchasing are the result of digitalisation. Many merchants are using bitcoins as well as other digital currencies. Transactions can be finalised through payment gateways and money transfers are easier.

Multi-channels. New technologies introduce new means of interacting with consumers. Emails and live chat can now be combined with personalised marketing campaigns, triggered text messages, and sponsored advertising or social media interaction. There are more channels that clients can choose from, which also means it becomes more difficult to capture their attention and track online activity, but it also requires more effort in being present on multiple web pages.

4.1.3 Disadvantages of using new technologies

Some disadvantages of new technologies are as follows:

Evolution. The introduction of new technologies results in the need to accommodate new circumstances. This means that if one business is using a technology, it will also impact another business and how it is positioned on the market. A business that is reluctant to introduce solutions that their competitors are offering can be left behind and their possibility of reaching international markets is lessened. It is important to note that markets differ from each other, and the tools and strategies that are used, should be tailored to a specific market. A mode of communication that may be the norm in one country, may be a novelty in another country.

Dependence. New technologies have had a huge impact on human behaviour. Individuals are now using technological devices to perform simple mental processes that were once possible to do without the use of technology. Over dependence on technology can also affect a business’ operation if it is very dependent on internet connectivity and is without an internet connection, the data stored across the cloud or services offered to customers will not be available.

Security. High-profile cyberattacks continue to happen regardless of the more advanced technology supporting security and safety that is available. This is also related to big data and the increasing amount of information that is stored online and across the cloud. Therefore, it is not only a matter of securing passwords and the back end of a website, but developing a system for tracking, detecting, reporting and combating any undesirable activities that could be targeted at online activities.

Cost. The investment in new (Industry 4.0) technologies is associated with high investment and most start-ups or SMEs are not in the position of being able to invest in the newest technologies. On the other hand this may result in not keeping up with competition.

Workforce. Technological discoveries have the potential to replace humans in their duties. This means that work that could be previously completed by humans can now be done by robots or machines. As a result more jobs will be made redundant, as more processes become automated.