moyo19_Westend61_Getty images_digitization Westend61_Getty Images

How Companies Should Leverage Digitization

As the COVID-19 pandemic has underscored the fragility of many business models, it has also intensified the race to adopt cutting-edge technologies. But adoption is only the first step; how these technologies are applied across five key areas will determine who reaches the finish line – and when.

NEW YORK – It is no secret that rapid digitization is upending firms’ operations, systems, and entire business models. Whether companies can both manage the risks and also reap the massive rewards that digital technologies can deliver depends significantly on the actions they take in five key areas.

First, digitization should enable managers to allocate the company’s capital and labor better – in real time. Efficient companies regularly review and upgrade their operations in at least three ways: streamlining existing processes, adopting best practices from outside their organizations, and identifying the most productive use of their assets. Digital technology can enhance all of these activities.

Movie-theater companies, for example, already deploy human capital based on real-time demand trends: in the United States, information about ticket sales and social-media reviews following releases on the East Coast will shape staffing decisions on the West Coast. Similar approaches can be implemented (or enhanced) in a wide range of sectors, boosting efficiency and productivity. The benefits will grow progressively, as companies adjust their hiring practices to target candidates with the relevant expertise.

We hope you're enjoying Project Syndicate.

To continue reading, subscribe now.



Register for FREE to access two premium articles per month.