THE IMPACT OF DIGITAL TECHNOLOGY ON FUNCTIONAL AREAS

Question 1

What does digital technology include

Answer 1

Digital technology includes the data that is generated and stored in binary form, and the hardware that is used to store and transmit such data.

It includes:

Financial transactions

Online communications (emails etc)

Computer networks

Cloud computing

Mobile technology

Question 2

What impact does digital technology have on finance

Answer 2

Ability to store vast quantities of data on financial transactions

Improved record keeping and reporting

Better tracking of cash flow - particularly debtors and creditors

Improved financial analysis (ratios)

Electronic funds transfer - reducing the opportunity cost of cash

Question 3

What impact does digital technology have on marketing

Answer 3

Impacts on all areas of marketing - product, price, promotion and place

Reduces cost of market research - collecting and analysis of data

Improved data collection on individual customers

Increased ability to target consumers with personalised marketing

Expands the size of target market

Reduces barriers to entry

Question 4

What impact does digital technology have on operations

Answer 4

Improved communications with suppliers = better inventory management

Increased ability to automate production process

Opportunities for mass customisation

Improved logistics and organisation of production process

Question 5

What impact does digital technology have on HR

Answer 5

Impact on job design

Hard vs soft HR

Flexible working patterns

Improved communications

Blurring of lines between work and home