MBADM830:

Lesson 1 Overview

The term Digital Economy is broad and encompasses a vast field of information. We first discuss the philosophy of the course. This course is expected to be taken at the end of the OMBA program and includes recent and relevant information technology topics mainly explored from strategic and operational views. We will discuss the challenges and opportunities in this area from a business viewpoint.

Lesson Objectives

At the end of this lesson, you should be able to

1. To answer the question: What is this course–Managing in the Digital Economy?

Structure of the Lesson

1. What is the digital economy?
2. What are emerging technologies?
3. What is our plan?
4. In the ideal world…

Lesson Readings and Activities

By the end of this lesson, make sure you have completed the readings and activities found in the Course Schedule.

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What is the Digital Economy?

The field of the digital economy is vast. It expands constantly and changes swiftly. One course, degree, or even a lifetime of work will not be enough for anyone to grasp its intricacies . To be effective, managers must understand the electronic heartbeats of the business. So, the questions remain: What should we study? How much? Which way? The answers, of course, depend on whom you ask – users, programmers, systems analysts, website administrators, and managers – will each have a "pat" set of responses. Here, I explain my rationale.

MBADM 830 addresses the ways digital technological innovations transform the industry, business models, strategies, operations, and management and create new markets and products. Course content focuses on (1) understanding digital markets, including information economics; (2) testing Clayton Christensen’s concept of disruptive innovations; (3) examining the implications of so-called “big data” for digital business; and (4) integrating current technical and behavioral developments with a focus on the transformational impact of digital innovation for work, business, industry, and society.

Many MBA programs include an introductory or strategy course on Management Information Systems (MIS). The course can be Introduction to Information Systems, Strategic Management of Information Technology (IT), Corporate Information Strategy, or Digital Strategies. The course title provides a cue to the content of the course. The title of our course, Managing in the Digital Economy, and the associated description also provide some insight into the content. The description is a theoretical framework and does not define the content of the course. Since we have 3 credits and one course as a constraint, the philosophical approach to this course can be described as follows.

First, we are looking at the latest digital/IT advances that can be characterized as disruptive innovations and have a transformational impact. Second, we may also explore established technologies that are critical in the business world and have continuing relevance for innovation. Second, we look at the operational, strategic, and industry-level effects of such advances. Finally, we are developing a way to approach such changes to existing and future business problems. The course does not delve into the technical aspects of IT.

As we study the digital economy, we will encounter an explosion of technical terms and jargon. We will discuss the relevant terms for our course from the next lesson onwards; for now, a general understanding is good enough. The term digital economy does not have a standard definition. Broadly, the digital economy is an economic system using digital technologies to create, distribute, and consume goods and services. It is characterized by the growing interconnectedness of people, businesses, devices, data, and processes through the Internet, mobile technology, and other digital channels.

The scope of the digital economy grows every year, and information technologies continue to push the frontier forward relentlessly. The digital economy affects all spheres of human activity. Figure 1.1 (click it to enlarge) indicates that the digital economy primarily affects business but also intersects with digital infrastructure, digital government, and digital society. This figure helps conceptualize the digital economy. However, remember that many researchers take a more comprehensive view of the digital economy and may contend that it covers all three circles shown in the figure. For our purposes, a general understanding of the term is sufficient.

A deep study of the digital economy will take many lifetimes and perhaps more. What are we going to study?

Figure 1.1

Looking at Figure 1.1 closely (click it to enlarge), you will see Emerging Technologies intersecting digital society and the digital economy. Disruptive innovations mostly come from emerging technologies. So, we will focus on emerging technologies most critical to the business world.

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What are Emerging Technologies?

There is no unanimity on the definitions. You will hear this repeatedly in different contexts in this course.

Emerging technologies form the vanguard of human innovation, taking us into uncharted territories where the possible boundaries are continually redefined. These technologies need not be new but should have continuing relevance and promise. The Internet, Enterprise Resource Planning Systems, and Social Media were all emerging technologies at one point or another. As these technologies mature and become standard operating procedures in the business world, they are no longer emerging. Emerging technologies are in the development and experimentation stage and have yet to have a finalized architecture in a fragmented industry. These technologies have the potential to create new industries or transform existing ones. The multiple perspectives on emerging technologies are given below.

• Technological Innovation Perspective: Emerging technologies are often seen as innovations or advancements that represent significant progress beyond the current state of the art. These could be artificial intelligence, biotechnology, nanotechnology, or renewable energy breakthroughs.
• Business and Market Perspective: From a business standpoint, emerging technologies can disrupt existing markets or create new ones. Companies may focus on adopting and investing in emerging technologies to gain a competitive edge.
• Research and Development Perspective: In the context of research and development, emerging technologies are often associated with cutting-edge scientific and technological discoveries. These may include experimental technologies that are not yet widely adopted but show promise in laboratories and research settings.
• Cultural and Societal Perspective: Emerging technologies can also be viewed in terms of their impact on society and culture. This perspective considers how new technologies shape human behavior, relationships, and societal structures. Examples include social media, virtual reality, and wearable devices.
• Policy and Regulation Perspective: Policymakers and regulatory bodies may define emerging technologies based on the need for governance and oversight. This perspective focuses on identifying technologies that require new regulations to ensure ethical use, safety, and compliance with legal standards.
• Disruptive Innovation Perspective: From the theory of disruptive innovation, emerging technologies are often associated with innovations that have the potential to disrupt established industries and business models. This perspective emphasizes the transformative impact of specific technologies.
• Adoption and Diffusion Perspective: Emerging technologies can be defined based on their stage in the adoption and diffusion curve. This perspective considers how quickly a technology is being adopted by individuals, organizations, or societies.
• Futurist and Speculative Perspective: Futurists may speculatively define emerging technologies, envisioning how certain advancements could shape the future. This perspective often involves considering the potential long-term consequences and applications of technologies.
• Environmental and Sustainability Perspective: Some definitions of emerging technologies assess their environmental impact and sustainability. This perspective considers technologies contributing to environmental conservation, resource efficiency, and sustainable development.
• Global and Cross-Cultural Perspective: The definition of emerging technologies can vary across different regions and cultures. What is considered an emerging technology in one part of the world may be well-established in another.

This course will primarily focus on emerging technologies in the information technology area from the business, market, and disruptive innovation perspectives, especially on emerging technologies' operational and strategic effects on businesses. We are not as interested in the how of IT tools but more in the why and for what. Internal operations, external trading partner relationships, and strategic orientations, among other things, have repeatedly changed under the relentless march of IT/emerging technologies. New industries have developed almost overnight, sometimes destroying the established order and ushering in rapid change. The hype and hysteria of the dotcom/social media/blockchain/big data/AI boom (and busts, in more cases), the evolution of many business models, messy markets, brilliant innovators, greedy investors, and occasional success stories taught us interesting lessons. But do they tell us anything about the future, the paths to choose and avoid?

The problems developing the course in this area are:

• Rapid Technological Advancements: The speed at which emerging technologies evolve is a significant challenge. New developments can occur during the course development phase, making maintaining up-to-date content challenging and ensuring the course remains relevant.
• Interdisciplinary Nature: Emerging technologies often cut across multiple disciplines, requiring an interdisciplinary approach. Developing a course that adequately addresses the diverse aspects of these technologies can be complex, requiring understanding and knowledge of different fields.
• Lack of Established Pedagogy: As emerging technologies are, by definition, at the forefront of innovation, there may not be well-established pedagogical frameworks. Instructors may struggle to find effective teaching methods and resources, and assessment criteria may need continuous refinement.
• Diversity of Technologies: The term emerging technologies encompasses a broad range of fields, including artificial intelligence, blockchain, biotechnology, and more. Designing a course that adequately covers diverse technologies while maintaining depth and coherence can be challenging.
• Ethical Considerations: Emerging technologies often raise ethical questions and concerns. Designing a course that explores the technical aspects and addresses the ethical implications and societal impact of these technologies requires careful consideration and expertise.
• Access to Resources: Staying current with the latest technologies requires access to cutting-edge software, hardware, and relevant literature. Additionally, access to these resources does not guarantee that you can study and learn all the new technologies and skills.
• Skill Gaps: Teaching emerging technologies may reveal skill gaps among instructors and students. Instructors may need to update their skills continually, and students may find it challenging to keep up with the fast-paced technological changes.
• Uncertainty in Industry Needs: The rapidly evolving nature of emerging technologies makes predicting the specific skills and knowledge in demand difficult. Courses may need to balance providing foundational knowledge and fostering adaptability.
• Inclusion of Practical Applications: Many emerging technologies are best learned through hands-on experience. Designing a course incorporating practical applications, labs, or projects can be challenging.
• Evaluation and Assessment: Traditional assessment methods may not be suitable for evaluating students' understanding of emerging technologies, often requiring creative problem-solving and critical thinking. Developing effective evaluation methods that capture the complexity of these technologies can be a significant challenge.

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What is Our Plan?

Please keep three issues in mind that answer why IT matters in business (Dhar and Sundararajan, 2007).

1. IT continually transforms industry and society,
2. Executive decisions about IT investments, governance, and strategy are critical to organizational success, and
3. Deriving value from increasingly available data trails defines effective decision-making in the digital economy.

IT is intertwined with business, so you probably have explored some effects of IT in other areas, such as operations, supply chain, and corporate innovations. This course builds on the preceding courses by investigating the newer digital innovations. However, you may encounter a couple of older classic cases which have stood the test of time. The digital innovations and topics chosen for the course are based on our perception of their importance and potential.

Topics of interest vary, and we continually update the course syllabi. If you have any suggestions, please let us know. Make sure that your reasoning is sound.

We plan to rely on cases, simulations, and/or report writing. Our objective is to develop a way of thinking, so our assignments and questions require critical and analytical thinking. You will be given detailed rubrics for assignments.

The following are general expectations for this course.

• Some students may have strong technical backgrounds, and others may have a more business-focused or strategic orientation. All of you have used at least productivity software and probably have experience with transaction processing systems. If you do not have any professional experience with IT, then perhaps you can relate your experiences as a technology consumer.
• You are not interested in specific applications but in the strategic and operational ramifications of IT.
• You are more interested in analysis, evaluation, and decisions than reading a long list of facts.
• You can all find information from libraries, the Internet, large language models, or plain printed books.
• You like to read and work.

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In the Ideal World…

As we embark on this exploration into the exhilarating world of emerging technologies, where the lines between imagination and reality blur and where the seeds of tomorrow's breakthroughs lie dormant, waiting for the right minds to nurture them into fruition, remember that the journey is as dynamic as the technologies themselves. We are not merely witnesses to innovation but active participants in shaping the future. The code you write, the ideas you conceive, and the ethical considerations you ponder have the potential to ripple through the ever-expanding landscape of technology. This course is not just about learning the latest tools and theories; it's an invitation to become architects of the digital frontier.

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Lesson 1 Summary

This lesson introduces the philosophy behind the course. The subject matter in this area is fluid and changes rapidly; the month's flavors evolve continuously, and it is easy to get lost in trivia. Please keep it in mind as we move forward in the course.

In the recommended readings, you will hear about the history of the Internet to ensure entry-level knowledge for all. Gartner’s hype cycle is an excellent conceptual tool for understanding emerging technologies. We will use it extensively in this course.

Additional Resources

Recommended

• Core Curriculum: Technology Strategy, Ramon Casadesus-Masanell, Series Editor, available via Harvard Business Publishing coursepack.
• For a fascinating history of the early MIS field, please read the classic article, Haigh, T. 2001. Inventing information systems: The systems men and the computer, 1950–1968, Business History Review, 75: 1–60
• Learn more about interpreting Gartner’s Hype Cycle (Recorded Webinar – approximately 15 minutes)

Optional

• If you are interested in learning the foundations of networking (and the Internet), please check out Welcome to the Network (linkedin.com) (1 hour 48 minutes)

Lesson Assessment

I trust you have read the lesson and the assigned articles, if any. These will be essential to the successful completion of the assessments.

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References

Dhar, Vasant, and Sundararajan, Arun, 2007. Information Technologies in Business: A Blueprint for Education and Research, Information Systems Research, Vol. 18, No. 2: 125–141.

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