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C) Illustrate how the introduction of technology affects an enterprise's (i) Business costs and (ii) Business opportunities. - Leaving Cert Business - Question C - 2004
Question C
C) Illustrate how the introduction of technology affects an enterprise's (i) Business costs and (ii) Business opportunities.
Worked Solution & Example Answer:C) Illustrate how the introduction of technology affects an enterprise's (i) Business costs and (ii) Business opportunities. - Leaving Cert Business - Question C - 2004
Step 1
(i) Business costs
Answer
The introduction of technology significantly impacts an enterprise’s business costs in various ways:
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Capital Expenditures: Businesses often incur substantial capital costs when investing in new technologies. This includes expenses related to purchasing new equipment, software, and infrastructure. For instance, companies that shift from traditional film cameras to digital cameras incur initial setup costs, which can be considerable.
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Operational Efficiency: Technological advancements can streamline operations, thus reducing labor costs. Automated systems and robotics can perform tasks previously done by humans, leading to better productivity and potentially fewer staff.
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Training and Development: Employees may require training to effectively utilize new technologies. This training can lead to additional costs for the business in terms of resources, time, and potential downtime during the transition.
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Maintenance Expenses: New technology also requires ongoing maintenance and updates, which can accrue significant costs over time. It's crucial for enterprises to budget for these recurring expenses.
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Risk of Obsolescence: Technology evolves rapidly, and businesses might face the risk of their existing technology becoming outdated, prompting further expenditure on upgrades or replacements.
Step 2
(ii) Business opportunities
Answer
The introduction of technology opens up several new business opportunities for enterprises:
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Expansion of Market Reach: Technology enables businesses to reach wider markets through e-commerce platforms. Companies can now sell their products globally, engaging with customers in various geographical locations.
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Improved Customer Experience: By implementing advanced customer relationship management (CRM) systems and digital communication channels, enterprises can enhance customer satisfaction through personalized services and faster response times.
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Innovation in Products and Services: Technology allows for the development of innovative products and services that previously did not exist. For example, software solutions can offer data analysis that helps businesses cater to specific customer needs more accurately.
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Cost Reduction through Efficiency: Utilizing technology such as supply chain management software can lower operational costs by optimizing inventory levels and reducing waste.
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Collaboration and Flexibility: Remote work technologies facilitate collaboration among teams, allowing for a more flexible work environment which can attract top talent and result in higher employee satisfaction.
Overall, the impact of technology can radically shape both costs and opportunities for enterprises, driving growth and fostering adaptability in a dynamic market landscape.