The internet is changing the way people do business in ways reminiscent of the assembly line. However, these changes are not just on an operations level, but on a much grander business scale.
The creation of the assembly line allowed each worker to focus on a singular task. This resulted in greater efficiency, quantity, and possibly most significant: specialization. The internet and IT are having a similar impact on businesses. In the past businesses would be involved in many levels of activity and every aspect of their industry from purchasing raw materials and manufacturing to selling and marketing. Now businesses are becoming more focused and specialized.
Take the example of Motorola and T-Mobile. In the past one company would have made the phones and then sold them. Today’s environment of fast communication and integrated IT has led to separate companies taking on these separate, more closely related tasks. Motorola has taken on the aspect of phone manufacturing and customer service. Meanwhile, T-Mobile has taken the task of marketing and sales. Consequently, each company is now involved in fewer activities, but they have become better at the activities they participate in. Sound familiar? That is right. Specialization.
With that said, you can predict the future for business. More of the same. In the example of Motorola, they may decide to simply handle customer service aspects and outsource the manufacturing aspects. Then they may decide to further specialize and only handle the technical side of the customer service, outsourcing all billing and account services. Just like the assembly line workers, businesses will continue to narrow scope and become more specialized.
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4 comments:
Remember Toyota. They started to get away from assembly line configuration to a cell configuartion for its manufacturing facilities.
What does that indicates? Is it possible that the assembly line is not or has no longer be the best method to use in manufacturing? Is it possible that someone has find a better way to use for their own manufacturing facilities?
No doubt globalization has become more popular and has become more effective/efficient than before. When you think about third world countries and other underdeveloped countries, they will improve and eventually be able to make what we are making right now... with much lower costs.
What is for us? Cheaper products for consumers and more opportunities for innovators.
I think this is the future of IT. It's becoming or may already be an industry where you must be the best at a single facet of the industry. You could interchange Dell into your example where they don't make the components for their systems. Instead they push their timely deliveries and customer service as their niche. In the case of Motorola/T-Mobile it's a great trade off where Motorola doesn't have to spend the money marketing and selling and T-Mobile doesn't get bogged down in the cost of producing and servicing the phones.
Apparently the guy who owns 4 T-Mobile stores in the Augusta area was not making enough on the service side of his business, so he was selling counterfeit purses, sunglasses, and other items out of the back of his stores. He is now in jail and probably rethinking his business strategy.
I think this is very true. Businesses are still operating in the areas they feel best represent their talent. This will continue due to IT.
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