Quote from F. Kotler’s book “Chaotica”
Information technology (IT) is one of the key factors shaping the process of globalization. Progress since the early 1990s in computer hardware, software, telecommunications, and digitization systems has enabled the rapid transmission of data and knowledge from anywhere in the world. The information revolution is likely the single most significant driver shaping the new global economy. By creating connections with the potential for all people and companies to be linked through a single medium—the Internet—buyers and sellers around the world can search, request, evaluate, buy, or sell regardless of distance. People no longer have to limit their buying or selling opportunities to the area where they are located.
Moreover, there is a serious issue that most company leaders, especially in large corporations and particularly top executives, were born during the industrial revolution but are leading their companies during the information revolution. In a sense, those who are already over thirty are digital immigrants, while those under thirty are digital natives. Currently, the information revolution has given way to information overload, which contributes to greater turbulence and chaos.
The internet has transformed and unified commerce, creating entirely new connections between buyers and sellers that enable them to conduct their transactions. Companies can manage the flow of their products and raw materials. Job seekers and employers can more easily find each other. New media websites have emerged: email, instant messaging, chats, electronic bulletin boards, blogs, podcasts, and webinars. A global system has developed that allows people and companies to find each other more easily, seek common interests, exchange information, and collaborate.
The global IT revolution has been driven by the extremely rapid decline in the cost of computers and the swift increase in their computing power, along with the emergence of new digital technologies. The memory and computing power of computers have doubled approximately every six months over the past two decades. In the future, the single most influential factor in information globalization that will propel the IT revolution to even greater heights will be cloud computing.
Cloud computing is a complex internet-based infrastructure where IT capabilities are provided as a service. Users access computing services through the internet “cloud” without needing knowledge, expertise, or control over the technological infrastructure and its maintenance.
As information technology encompasses the global Internet “cloud,” the increasing volume of computing is shifting to data centers that are accessible from anywhere. IT is once again moving towards greater centralization. But how will this affect the way people conduct business?
The cloud will allow digital technology to penetrate every hidden corner and crack of the economy and society, creating a series of tricky political problems and increasing economic turbulence for companies that will have to deal with it. One trend is already emerging. Companies must become like the technology itself: more adaptable, more integrated, and more specialized. These processes may not be new, but cloud computing will accelerate them.
Cloud computing has achieved tremendous success among emerging companies, which can now access and use software of the same quality as that of large corporations. If it weren’t for cloud computing systems like Amazon Web Services (AWS) from Amazon.com, many new businesses might not have emerged at all. For example, the service Animoto allows users to turn photos into elaborate music videos using artificial intelligence. When this service was launched on the popular social network Facebook, the demand was so high that Animoto had to increase the number of its virtual machines on AWS from 50 to 3,500 within three days.
The impact of web service-based solutions will be felt at the macroeconomic level, as cloud computing makes small firms more competitive compared to larger ones. This will help developing economies compete with developed economies. These two factors alone will contribute to significantly increased market turbulence for companies of all sizes.
The fact that cloud computing is global will lead to political tensions regarding how it should be regulated. Cloud computing relies on a large number of virtualized computer systems and electronic services that are borderless. Governments are likely to go to great lengths to avoid losing even more control over the Internet, which will inevitably create further opportunities for turbulence and chaos for companies that base their IT strategies on the use of cloud computing.
There is one subtle phenomenon regarding cloud computing that few experts have paid enough attention to so far: knowledge sharing. The technology has yet to offer easy ways to find people and exchange knowledge among them. This is essentially the “holy grail,” something that even Microsoft has not been able to solve, although it has come very close with its SharePoint product. The Microsoft SharePoint platform includes a web-based collaboration system and a document management platform that can be used to host websites providing browser-based access to workspaces and documents, as well as specialized solutions like wikis and blogs. In reality, the main challenge lies in organizing collaboration effectively and securely across firewalls and among different companies that are stakeholders in each other’s businesses. The goal is to share knowledge while simultaneously limiting its dissemination (i.e., allowing access only to certain data). This remains the biggest issue. Another ongoing challenge facing businesses that still needs to be addressed is the separation of communication and information. This is, in fact, a false division because information is communication, and communication is information. As long as software development companies continue to separate these two realms, the problem will not be resolved.