It is safe to say that technology and the Internet have changed the way in which businesses operate today and consumers find particular product/services. This has prompted the question, what role do old industries have in the future economy. It is fair to say that their role has changed but it is totally wide of the mark to suggest that they are no longer required.
New technology
Technology has now literally taken over the business marketplace and changed it into something which many people will not recognise. The ability to shop 24/7, acquire products and services from around the world and communicate all day everyday has taken the retail sector to a whole different level. However, technology has also had a material impact on so-called “old industries”.
Banking
Banking has seen a huge change since the introduction of the Internet which has taken private banking to the masses. The ability to manage your finances online any time of the day or night with no requirement to ever visit your local branch has been a game changer. While it is safe to say that many of the new entrance to the banking industry have benefited from a limited physical base for their business, there have been cost benefits for all operators.
Car manufacturing
Despite seen by many as an “old industry” this is an area of business which has made use of robots and the latest technology for many years. So, to suggest that car manufacturing does not have a major role in the future economy of the world is also misleading. Also, if we look at the likes of Tesla we can see how new technology, in the shape of electric vehicles, is moulding the shape of the industry going forward. Those companies slow to move forward and adapt to new technologies will certainly struggle – many shareholders already have many tales to tell!
Retail
The retail sector on a worldwide basis has been impacted hugely by the introduction of the Internet and e-commerce. As we touched on above, the opportunity to buy products/services 24/7 at any time of the day or night has been a game changer. In tandem with the banking industry new entrance to this market often have a very limited physical presence and seem to consist of just warehousing and office/distribution sites. You only need to look up and down your nearest high street to see the way in which the retail sector has been taken apart and rebuilt.
Computing
While computing itself as an industry is not necessarily an “old industry” we only need to look at the likes of IBM and Dell to see how things have changed. IBM in particular seems to have been left behind by the new era in which we now live and despite suggestions that the sum of the part is greater than the market cap, IBM is still struggling to find its niche in the new changing computer industry. When great giants such as IBM are left in the wake of their smaller often more nimble counterparts, this really does show the difference between old established companies and new companies.
Summary
While technology has changed the way in which businesses operate and consumers acquire products/services, it is not only the new industries which are benefiting. It is safe to say there is no area of the business arena which has not been impacted by e-commerce, the Internet and new communication networks. How these industries evolve and how specific “old industry” companies adapt is a whole different question. Those who fail to adapt to the new environment may well disappear forever, taking with them some of the best-known names from the world of business.