How can the digital economy help shape the best version of our future
The digital economy rests on the scaffold of hyper-connected individuals, organizations, and digital devices These new developments have been realized with the continually evolving technologies such as the Internet of Things (IoT), mobile technology, AI, and Big Data. However, such transformations rarely occur in a vacuum. It can only be deemed as a cultural shift and requires increased attention and scrutiny on our part. This may result in uncertainty stemming from the drastic changes in our economy. Thereby raising people’s concerns regarding their financial safety, professional development, and personal well-being under the emerging digital economy.?
Oftentimes, investors and professionals are perplexed by the racing and sometimes speculative technological advancements. In addition, the concerns on automation and transforming the industry have suppressed people’s confidence in the future. By sharing insights about the digital economy, the blog hopes to establish new expectations and assertiveness in readers to be ready for the digital economy.?
The Power of Digital Economy
The future is digital, and this change comes with an array of opportunities and avenues that will fundamentally alter the way economies function.
The United Nations Conference on Trade and Development (UNCTAD) Report on Digital Economy highlighted growing digital data and digital platforms as the drivers of this revolution. With access to time-sensitive data, organizations can establish insightful patterns which in turn allow value-laden, preemptive actions.?
The emerging digital market in Indonesia?
Indonesia as a country has acquired an acute understanding of this market and its dynamics. The Indonesian market is geared to be the fourth-largest economy by 2050, according to PwC’s ‘World in 2050’ report. Currently, it holds an impressive record of over 2000 technology start-ups, including many fintech companies. This sound infrastructure coupled with the initiatives taken up by the government demonstrates how Indonesia is strategically moving in the right direction.
The recent multi-billion valuation of the Indonesian company ‘GoTo’ further exemplifies this argument. GoTo emerged as a tech giant after the merger of the two companies-Gojek and Tokopedia. This enterprise “combines e-commerce with on-demand and financial services” and has thus created a unique platform for the Indonesian market. Online marketplace, Bukalapak is Indonesia’s first tech unicorn to tap the country’s stock market. The e-commerce shopping portal offers a wide range of consumer products and is on a mission to digitalise mom-and-pop stores in the country. Backed by Microsoft, Bukalapak is bridging the digital gap and creating new opportunities to accelerate growth in the Indonesian digital economy for businesses. Indonesia is still an emerging digital market country. It has many untapped potentials that can be realized by supporting MSMEs in their digital transformation journey and incentivizing start-ups.?
It is here to better the future
Opportunities presented in today’s economy are far more inclusive, diverse, and sustainable as compared to the traditional markets. Because of increased accessibility to the drivers of digital transformation, power is no longer centered with a select few. With remote working stations, easy access to cloud technology, and cross-industry applications, even small enterprises and start-ups can enter the market. Similarly, new avenues have opened up for corporate leaders and venture capitalists.?
New economy foster new industries
The emerging platform of the digital economy allows companies to leverage technology and create new business models; exhibiting agility and adaptability, and adding value in the post-covid world. Technologies such as IoT, AI, Machine-learning, etc can be harnessed to increase digitization of work and enhance innovation. Indonesia is cognizant of this lucrative market. For example, eFishery provides an IoT-based automatic fish feeding solution and is valued at $4M. Cubracon is another such organization that enables offline stores with Bluetooth-tracking beacons.?
Digital Transformation makes us a safer and more efficient powerhouse?
Lastly, let us consider the sustainability of these solutions. With the advent of the fourth industrial revolution, we have a unique opportunity to incorporate sustainable ideas into our daily transactions. Microsoft Azure (2020) by conducting? an independent study proved the environmental efficiency of cloud computing? to the traditional alternative of on-site data storage12. These technologies not only help realize economies of scale, but also drastically reduce carbon emissions. Furthermore, the utility of technology such as IoT in the energy sector has immense potential. These efforts can streamline the process and provide energy-efficient solutions.
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Prepare for the new era
As the core fundamentals of the industry are changing, so should one’s strategy and vision. While goals may be carried forward, the means to achieve them require a shift in approach. Companies need to be on the lookout for new ventures and technology and invest in relevant capacity building.?
Future proof investment intelligence?
The question of how to stay relevant has been tasked to corporations in the context of the pandemic and increasing digitalization. Investment decisions, therefore, need a hard reboot. There is an unprecedented demand for cross-border connectivity among companies and people. Institutes had to turn to applications like Microsoft Teams to meet these new challenges of hybrid work.?
Applied fields such as Robotics, micro-mobility, Virtual Reality, have proven their need and efficiency in these trying times as work has become increasingly remote. For example, virtual reality has the potential to become an integral part of routine lives to mimic human interactions in a distanced world.?
The value of AI and cloud computing
The fusion of AI and cloud computing allows companies to leverage large data sets by modelling meaningful patterns out of them. Predictions become accurate with time and the applications of such information are limitless. Moreover, this technology can be morphed to suit any industry. Indonesian AI startup ecosystem substantiates these claims. Edtech platforms like Ruangguru, allow students to learn new skills.?
The importance of human skills in the new era
At the end of the day, assimilation of these technologies should be viewed as a means to an end. The process of meaning-making and application of insights relies on essential human skills like critical thinking and self-management. While automation of tasks may pose a threat to around 85 million jobs by the year 2025, new opportunities will simultaneously open, requiring uniquely human characteristics and skills. Therefore, with a job-person fit attitude, employees should focus on upskilling and enhancing their portfolios.?
Conclusion
Indonesia's digital economy witnessed a 49% growth rate in the years between 2015 and 2019. In fact, it is expected to reach $124 billion by 2025. By investing time and attention to the latest developments, one can be at the forefront of this revolution. Adopting digital transformation not only improves efficiency and productivity, but also makes the organization resilient to economic uncertainties. Furthermore, the oft-neglected indices such as employee well-being and environmental impact can easily be assimilated into this model of business.?
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