There are various themes which are emerging in the current competitive business environment therefore organizations must focus on utilizing the emerging themes in order to gain a competitive advantage in the market over their competitors and also to increase the scope of operations of the business organization. According to Anghel et al. (2015) there are four pillars of emerging themes namely emerging technology which highlights growth and development of new and innovative technological advancements, emerging societies which highlights the growth and popularity of new forms of society, emerging industry and market which highlights the growth and popularity of various new sectors and markets in an economy and emerging work environment which highlights the growing popularity of new kinds of working environment in context of business organizations. All the above stated pillars act as basis for emerging themes for business organizations.
The article provided in the case study focuses on emerging technology in the form of drone technology. Drone technology has become one of the most popular emerging technologies which every sector is focusing to utilize in order to gain a competitive edge in the sector in which they operate as it is widely evident that use of drone help in increasing the efficiency of the organizations by reducing costs and increasing productivity. The article highlights on the point that use of drone technology in various sector could contribute to the increase of Gross Domestic Product by £42 billion. The article also estimates that by 2030, there would be £ 16 billion in net cost savings in the UK economy due to the widespread popularity of drone technology. The article also estimates that there will be approximately 76,000 drones which will be operating in the skies of UK due to widespread application of drones in multiple sectors and the article projects that there will be approximately 628,000 jobs which will be generated in UK alone due to the drone economy.
The current report focuses on the identification of impact of emerging technology on the retail sector and on the organizations belonging to the retail sector. The report also focuses on the identification of advantages and disadvantages of the emerging drone technology. Further the report focuses on the potential futuristic effect of drone technology on the organizations belonging to the retail sector and accordingly provides recommendations for managers of retail organizations to mitigate against or maximize the identified impacts on the retail sector.
1. The emerging theme which has been highlighted in the article is emerging technology in the form of drone technology. As stated by Lee (2015) drones or unmanned aerial vehicle has become a disruptor in every sector in which it is being implemented and application of drone technology specifically has helped business organizations belonging to retail sector to increase their efficiency and profitability by enabling cost savings and reducing defects and in-efficiencies. The application of drones in retail sector eliminates the chances of human error and also promotes workplace and worker safety. Further application of drones enables human workforce of retail sector to focus on increasing the values of their products and services which drives the sales of their product and service.
According to Elliott, Hall and Meng (2013) drones are expected to play a vital part in the growth and expansion of the global retail sector in the coming years. The existent competitive pressure which is observed in the global retail sector have driven them to invest and develop new and innovative ways in order to make their supply chain more efficient in nature and therefore the retail sector has turned their attention to utilize the opportunities offered by drone technology to cope up with the competitive pressure. The largest global retailers and e-commerce giants are turning to drones in order to improve the efficiency of their supply chain.
2. According to Dow Jones Institutional News (2017) in the global retail sector, there are huge economic impacts due to the application of drone technology or drones as it results in lower costs and improved productivity in the retail sector. The retail sector uses drones in order to automate routine day to day tasks which helps in improving safety and performance, reduce risks associated with the day to day tasks, helps in improving the quality of products and services offered by the retail sector and also helps in freeing up the human resources in order to make them focus on more interesting and value adding tasks which help in driving customer values. There are various impacts of using drones which has been identified in the retail sector which are as follows:
Impact on distribution centre and inventory management facilities- As stated by Dow Jones Institutional News (2015) with the rapid increase in consumer expectations and increase in competition regarding slick supply chain solutions, the competitive advantage is gradually up for grabs in the retail sector through the tightening of inventory management and category management systems. As stated by Dumitru et al. (2015) working from a single inventory pool for all channels, drone technology is considered as one of the most vital enabler in the goal for a seamless online and offline experiences. The use of drones in warehousing and storage facilities enables the reduction of number of employees required at each location which in turn allows retailers to cut their costs. The speed which is being offered by drone technology helps in the creation of automated and more efficient supply chains. As stated by Lewis and Loker (2014) for retail companies with a large number of distribution centres and large number of super centres, drones help in increasing the efficiency of each of their centres and facilities.
Impact on site selection and facility planning- As stated by PR Newswire (2016a) drones are already being used widely in the retail sectors which enables the developers to explore a large portion of warehousing site aerially and in turn helps in preparing planning maps which are more precise in nature. Also the retail sector have started to take the help of drone technology for selecting sites, for store planning purposes, for effective designing of shopping centre and in order to monitor all the aspects of development of a retail location in a more effective manner.
Impact on retail securities to patrolling properties-As stated by Aloysius et al. (2018) security is one of the vital areas which are being explored by drone technologies. In the retail sector drones are used for security and patrolling purposes as it allows secured parking area to the customers visiting the shopping centre or retail outlets and it also helps in monitoring of shopping centres and interiors of stores at any time of the day by professionals working in off-site location.
Impact on consumer insights- Multiple studies have indicated that most effective and fittest retail strategies are those which are being based on strong consumer insights and as a result drones have changed the way in which retailers collect consumer insights which have helped them to develop effective retail strategies. Retail organizations have been monitoring footfall in their locations but the use of drones have enabled retailers to measure traffic and flow of customers beyond their stores. Drones also help retailers to assess the pattern of movement of vehicles towards their stores and also help in assessing whether their customers gets fed up with the congestion in the parking area or outside the store locations so that they can take actions to ensure that the customers reach the store in the most convenient and hassle free manner.
As stated by Chiu and Hofer (2015) in order to measure the flow of customers towards their store, various organizations belonging to the retail sector are also flying drones above their retail locations for collecting data and insights regarding the effectiveness of the signage, the positioning of entrances of retail stores and to measure impact of traffic and other factors in the surroundings as in the age of Omni channel and ecosystem retailing, pre-sales is considered as vital as post sale. Therefore, the data and insights which are received from drones have a significant impact on the bottom line of various organizations belonging to the retail industry.
Impact on energy efficiency- Various retailers, shopping centres and other retail facilities use thermal cameras on their drones which helps in increasing their energy efficiency and which enables retail organizations to save money and also enables them to support and promote a greener retail industry.
3. The impacts of emerging technology such as drones on retailers such as Amazon are as follows:
Stock and Inventory- As stated by Gordon Crovitz (2016) retailer like Amazon uses drone technology for the management of their stock and inventory as the drones makes it more feasible for warehouse to build upwards instead of outwards so that they can reach to higher levels. Also drones are able to locate items in the warehouse in a more effective manner due to exact understanding of floor layout. The drones also help in refilling items in particular shelves of the company which are detected to be stocked at lower levels.
Delivery- retailer like Amazon uses drone in order to deliver products to the customers at their doorsteps. The drone delivery is very fast form of deliver as the product does not require delivery through traffic congestions.
Security- retailer like Amazon also utilize drones to ensure security of products in the warehouse and distribution centres as human security and surveillance cameras are not adequate for preventing theft and therefore the mobile nature of drones helps in ensuring security of products.
4. The merits of using drone in the retail sector are as follows:
It helps in saving time- According to Inman and Nikolova (2017) drones are considered very convenient for retailers who want to save time as drones help in saving a significant amount of time in context of logistics delivery, collection of data and insights, clicking of real time photographs or getting real time updates of various situations. Drones helps in saving time as they cover a large amount of area in a very short span of time.
Used as logistics- As opined by Aloysius, Hoehle and Venkatesh (2016) various retail companies and online retailers are taking advantages of drones for logistics purposes. A large number of online retail companies use drones to deliver their products to customers at a very short span of time and in a very efficient and systematic manner.
Drones require lesser efforts- As stated by Thurlow (2015) in terms of retail industry it can be stated that retail organizations require lesser effort in terms of supervision and maintenance. It requires very limited human interference to control drones and hence they can be very easily and conveniently handled with limited human need and hence it can be said that drones requires lesser efforts.
Versatility- Drones can be used for a variety of operations and utilities in the retail sector such as delivery, warehouse management, consumer insights, security, site selection and facility planning and therefore a single technology can serve multiple purposes for the retail sector.
Creation of jobs and opportunities- As stated by Ecn (2016) the popularity of drone technology has resulted in the creation of multiple job and employment opportunities in the retail as the sector requires various experienced and qualified human resources who have knowledge in operating drones.
Helps in promotion of safety- As stated by PR Newswire (2016b) drones are fully capable of reducing human involvement in various day to day tasks in retail organizations and therefore drones helps in preventing and avoiding the risks of accidents which can occur due to human involvements. Drones help in undertaking various risky and accident prone activities and thus help in promotion of safety.
The demerits of using drones in the retail sector are as follows:
Shorter lifespan-As stated by Romero and Martínez-Román (2015) the lifespan of drones are considerably less than other photographic or recording devices owing to their shorter battery life. As drones are meant to fly, the size of the battery of the drone remains less which results in lesser battery power. It is typically observed that on full charge an average drone can function up to four hours whereas the lifespan of other photographic and recording devices are comparatively larger than drones.
Vulnerable to aerial attacks- It is observed that drones remain vulnerable to various aerial attacks such as attacks of birds, clash with other flying objects and entanglement with branches of trees or nest of birds during unfavourable weather conditions and therefore utmost care should be taken while flying drones.
Threat of hackers- Drones also remain vulnerable to attack from hackers as they can invade the main control system of the drones replacing the original users of the drones with the new drivers and controllers of the drones. The network and control system of the drones comprise of vital insights and information which are susceptible to hackers without the knowledge of the actual user of the drones.
Privacy issues-As opined by Guillot (2015) drones are acting as catalyst regarding privacy concerns that has been already created due to similar modern technologies such as video cameras and enhanced satellite images. As drones are capable of moving to any locations and capture images and videos of the highest qualities, therefore many individuals perceive drones as a threat to their personal privacy.
Legal issues- Various government organizations and regulatory bodies have set various rules and regulations regarding the private and professional use of remote controlled drones but there are still various controversial areas which remain unsettled and therefore there still remain various unresolved areas regarding the use of drones.
The potential futuristic implications regarding the use of drones in retail organizations such as Amazon in various contexts are as follows:
Organizational Objectives- The organizational objectives of Amazon mainly focuses on improvement of the supply chain efficiency and investment of significant amount of funds in research and development regarding enhancement of drone technology to improve customer delivery. The organizational objective of Amazon is also to increase the productivity of the company by reducing costs.
Operations and Practices-According to Wells and Stevens (2016) the operations and practices of Amazon are more automated in nature with lesser number of human involvement as human resources of the company mainly concentrate on enhancing customer values and benefits and their day to day operations are largely controlled by drones.
The economy-As opined by Rao and De’ (2015) the economy will grow and develop at a more faster rate owing to high job opportunities which have been created due to the implementation of drone technology in the day to day operations of Amazon. The economy is also projected to grow at a faster rate due to widespread usage of drones in the company as it aims to cost reduction which help to increase productivity and efficiency and in turn lead to greater gross domestic product of the country where Amazon operates.
The society- The society has become greener and sustainable in nature owing to adoption of green practices by Amazon. Also it has led to economically sustainable society due to adequate income opportunities and owing to development of local community.
The industry/sector-As stated by TWICE (2017) the retail companies like Amazon will become more competitive in nature and it will become one of the largest contributors to the gross domestic product of the country to which they belong. The retail companies like Amazon will contribute to majority of net cost savings of the economy to which they belong and will also provide a large percentage of employment opportunity to the economy.
Customers-As opined by Guthrie (2016) the customers of Amazon receive faster delivery at their door steps within a very short time span owing to faster drone delivery system. The customers of the company also get high quality personalised service experience owing to higher availability of consumer insights due to drone system applied at Amazon.
Government-The government has come up with various new regulations, restrictions and legislations regarding the usage of drones in the day to day operations of Amazon and therefore in order to continue the usage of drones, the company needs to cope up with the regulations and restrictions imposed by the government of the country.
Competitors- The competitors of Amazon such as E-bay and Alibaba continue to explore other emerging technologies and technological advancements in order to compete with Amazon in the market and hence to gain competitive advantage Amazon continues to invest heavily in research and development of other disrupting technologies.
Any other relevant stakeholders-As opined by Najib Razali et al. (2014) the other relevant stakeholders of Amazon, such as their existing employees, will focus more on value creating activities of the company in order to offer more values to the customers so that they remain loyal to the products and services of Amazon.
The recommendations for the managers of Amazon in order to maximize the impact of drones are as follows:
References:
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