Emerging technologies for businesses
• Session 2 — Business Models in a Digital
Economy
Teaser Reflection
Managers are increasingly expected to identify opportunities where emerging
technologies can create new value. The opening question asks how managers can
discover and position themselves within these so-called sweet spots — areas where
technology, market needs and feasibility align.
1) The Rise of a Digital Economy
We live in an information society where more and more business opportunities
emerge from technological progress. Historically:
• In the 1970s and 1980s, computers and early IT systems transformed
industries during the third industrial revolution.
• The 1990s brought the internet, followed by e-commerce expansion in the
2010s and the rise of social media.
• Today, digital technologies disrupt markets and create the possibility of a
fourth industrial revolution — commonly referred to as Industry 4.0.
The term Industry 4.0 was first introduced at Hannover Fair in 2011. It was initially
used to describe digital integration in manufacturing but now refers more broadly to
technology integrated across every type of organization. Examples include the
Internet of Things for large-scale sensor data collection and artificial intelligence for
analysis of that data.
Industry 4.0 and Industry 5.0
Industry 4.0 represents the digital integration of systems, automation and data
processing in industrial environments. Examples include AI, IoT, robotics,
cybersecurity and cloud computing.
Industry 5.0 extends beyond efficiency and removes the assumption that automation
always replaces human involvement. This new stage emphasizes sustainability,
resilience and human-centric technological development:
• Social: promotes talents, diversity and empowerment
• Green: leads action on sustainability and respects planetary boundaries
• Economic: is agile and resilient with flexible and adaptable technologies
Digital economies rely heavily on data centres, which means growth in this sector
also results in increased energy consumption. Technologies such as the internet, big
data, cloud infrastructure and cybersecurity all contribute to this demand.
1
,Emerging technologies for businesses
Scope of the Digital Economy
The digital economy can be viewed as three nested
layers:
1. The Digital IT Sector — the core foundation,
producing digital goods, services, data and
platforms such as social media.
2. The Digital Economy — expands to include
the use of digital technologies across
industries → use in all organizational sectors
3. The Digitalized Economy — the largest
layer, where digital technologies are fully embedded into e-commerce and
industryt 4.0 technology integration
Link to digi-related concepts:
• Purpose of a digital economy for organizations
o Creating business value (internally)
o By creating value for customers (externally)
• However, consumer expectations continue to rise: t
o hey want access anywhere and anytime
o personalized offerings
o shared ownership of products
o environmentally friendly production
• This drives companies to adopt new business models like customization,
servitization, crowdsourcing and sharing platforms.
Vlerick Business School refers to this shift as the ExConomy, meaning a digital
economy driven by experience, exchange, experimentation and exponential
connectivity:
1. Customer Experience is value New mindset
2. Experimentation is required
3. CO-reshapes value chains
4. E-CO-system platform rules New result
2
,Emerging technologies for businesses
2) Defining Digital Concepts
Two key areas are defined here: the difference between IT and digital technology,
and the concept of digital innovation.
IT vs Digital Technology
Information Technology, information and communication technology (IT or ICT)
traditionally refers to systems that collect, store, process and transmit information.
These may involve (digital) software, hardware(physical) or both.
Digital technology is used in a broader sense to highlight the omnipresence of IT in
modern products and services. In many cases, the technology becomes inseparable
from the product itself — for example, a car is no longer just mechanical, but a digital
platform on wheels.
Digttal Innovation
Digital innovation involves the continuous use of technology to improve products,
services, processes or business models with the goal of achieving competitive
advantage.
A digital innovation results in a change in market offerings, internal processes of
models that result from the use of digital technology. Technology is not an addition —
it is a core component of the innovation.
Examples:
• Product/service innovation: replacing film photography with smartphones.
• Process innovation: moving from paper-based evaluation to automated
coordination systems.
• Business model innovation: replacing physical video rental stores with
streaming platforms.
3
, Emerging technologies for businesses
Innovation can exist at three increasing levels:
1. Digitization — converting analog information into digital form. ( CD → MP3)
2. Digitalization — using digital tools to improve processes. (apps from
supermarkets)
3. Digital Transformation — completely redesigning how value is created and
captured through digital technology. (strategic change, structural change,
cultural change. Longterm and large scale) (electric/ self-driving cars)
Different drivers to initate digital innovation:
• Triggered by a problem (current) or an opportunity (future)
• Focused internally (organizational way of working) or externally (customers
and stakeholders)
• New markets, new tech. Opportunities, changing customer expectations,
increased market competition, inefficient and ineffective business processes
Traditional industries such as taxis, hotels, travel agencies, supermarkets and
marketing agencies are challenged by uber,airbnb, booking, insta... Digital
4
• Session 2 — Business Models in a Digital
Economy
Teaser Reflection
Managers are increasingly expected to identify opportunities where emerging
technologies can create new value. The opening question asks how managers can
discover and position themselves within these so-called sweet spots — areas where
technology, market needs and feasibility align.
1) The Rise of a Digital Economy
We live in an information society where more and more business opportunities
emerge from technological progress. Historically:
• In the 1970s and 1980s, computers and early IT systems transformed
industries during the third industrial revolution.
• The 1990s brought the internet, followed by e-commerce expansion in the
2010s and the rise of social media.
• Today, digital technologies disrupt markets and create the possibility of a
fourth industrial revolution — commonly referred to as Industry 4.0.
The term Industry 4.0 was first introduced at Hannover Fair in 2011. It was initially
used to describe digital integration in manufacturing but now refers more broadly to
technology integrated across every type of organization. Examples include the
Internet of Things for large-scale sensor data collection and artificial intelligence for
analysis of that data.
Industry 4.0 and Industry 5.0
Industry 4.0 represents the digital integration of systems, automation and data
processing in industrial environments. Examples include AI, IoT, robotics,
cybersecurity and cloud computing.
Industry 5.0 extends beyond efficiency and removes the assumption that automation
always replaces human involvement. This new stage emphasizes sustainability,
resilience and human-centric technological development:
• Social: promotes talents, diversity and empowerment
• Green: leads action on sustainability and respects planetary boundaries
• Economic: is agile and resilient with flexible and adaptable technologies
Digital economies rely heavily on data centres, which means growth in this sector
also results in increased energy consumption. Technologies such as the internet, big
data, cloud infrastructure and cybersecurity all contribute to this demand.
1
,Emerging technologies for businesses
Scope of the Digital Economy
The digital economy can be viewed as three nested
layers:
1. The Digital IT Sector — the core foundation,
producing digital goods, services, data and
platforms such as social media.
2. The Digital Economy — expands to include
the use of digital technologies across
industries → use in all organizational sectors
3. The Digitalized Economy — the largest
layer, where digital technologies are fully embedded into e-commerce and
industryt 4.0 technology integration
Link to digi-related concepts:
• Purpose of a digital economy for organizations
o Creating business value (internally)
o By creating value for customers (externally)
• However, consumer expectations continue to rise: t
o hey want access anywhere and anytime
o personalized offerings
o shared ownership of products
o environmentally friendly production
• This drives companies to adopt new business models like customization,
servitization, crowdsourcing and sharing platforms.
Vlerick Business School refers to this shift as the ExConomy, meaning a digital
economy driven by experience, exchange, experimentation and exponential
connectivity:
1. Customer Experience is value New mindset
2. Experimentation is required
3. CO-reshapes value chains
4. E-CO-system platform rules New result
2
,Emerging technologies for businesses
2) Defining Digital Concepts
Two key areas are defined here: the difference between IT and digital technology,
and the concept of digital innovation.
IT vs Digital Technology
Information Technology, information and communication technology (IT or ICT)
traditionally refers to systems that collect, store, process and transmit information.
These may involve (digital) software, hardware(physical) or both.
Digital technology is used in a broader sense to highlight the omnipresence of IT in
modern products and services. In many cases, the technology becomes inseparable
from the product itself — for example, a car is no longer just mechanical, but a digital
platform on wheels.
Digttal Innovation
Digital innovation involves the continuous use of technology to improve products,
services, processes or business models with the goal of achieving competitive
advantage.
A digital innovation results in a change in market offerings, internal processes of
models that result from the use of digital technology. Technology is not an addition —
it is a core component of the innovation.
Examples:
• Product/service innovation: replacing film photography with smartphones.
• Process innovation: moving from paper-based evaluation to automated
coordination systems.
• Business model innovation: replacing physical video rental stores with
streaming platforms.
3
, Emerging technologies for businesses
Innovation can exist at three increasing levels:
1. Digitization — converting analog information into digital form. ( CD → MP3)
2. Digitalization — using digital tools to improve processes. (apps from
supermarkets)
3. Digital Transformation — completely redesigning how value is created and
captured through digital technology. (strategic change, structural change,
cultural change. Longterm and large scale) (electric/ self-driving cars)
Different drivers to initate digital innovation:
• Triggered by a problem (current) or an opportunity (future)
• Focused internally (organizational way of working) or externally (customers
and stakeholders)
• New markets, new tech. Opportunities, changing customer expectations,
increased market competition, inefficient and ineffective business processes
Traditional industries such as taxis, hotels, travel agencies, supermarkets and
marketing agencies are challenged by uber,airbnb, booking, insta... Digital
4
