Technology and its importance in business

Technology has important effects on business operations. No matter the size of your enterprise, technology has both tangible and intangible benefits that will help you make money and produce the results your customers demand. Technological infrastructure affects the culture, efficiency and relationships of a business. It also affects the security of confidential information and trade advantages.

Business Culture and Class Relations

Technology creates a team dynamic within a business because employees at different locations have better interactions. If factory managers can communicate with shipment coordinators at a different location, tensions and distrust are less likely to evolve. Cliques and social tensions can become a nightmare for a business; technology often helps workers put their different backgrounds aside.


Most businesses of the modern era are subject to security threats and vandalism. Technology can be used to protect financial data, confidential executive decisions and other proprietary information that leads to competitive advantages. Simply put, technology helps businesses keep their ideas away from their competition. By having computers with passwords, a business can ensure none of its forthcoming projects will be copied by the competition.

Research Capacity

A business that has the technological capacity to research new opportunities will stay a step ahead of its competition. For a business to survive, it must grow and acquire new opportunities. The Internet allows a business to virtually travel into new markets without the cost of an executive jet or the risks of creating a factory abroad.

Consumer tech and its importance

Fitness company Peloton is the latest startup to pedal towards the public markets as it publicly filed its registration statement on Tuesday. The New York-based company posted $915 million in revenue for its 2019 fiscal year (July 2018 to June 2019), but also rising losses as it spent more on advertising to acquire users. It lost $195.6 million, up from $47.9 million from the previous year.

Started in 2012, Peloton became a cult fitness hit due to its combination of live-streamed classes and an on-demand library of workouts. The company started out originally with a connected bike, but has since expanded into a treadmill and now offers classes like stretching and yoga to its subscribers. The company counts more than 511,000 subscribers who do on average 11.5 workouts per month, up from 8.4 the year prior.

Most of Peloton’s revenue comes from a combination of sales of its connected bike and treadmill products, along with its $39 a month fitness subscription. Its high price-tag ($2,245 for a bike or $4,295 for a treadmill) helped make up the bulk of Peloton’s revenue: $719 million from sales of physical devices for its fiscal year 2019.

What is Consumer Tech?

Aramco’s net income for H1 2019 was $46.9 billion. This is actually a 12% decrease from its net income for the first half of 2018, but was expected because the price of the Brent oil benchmark has averaged $66 per barrel this year as opposed to $69 per barrel last year. The company continues to diversify by growing its downstream sector as well as become more integrated.

Yet, the big questions concerning the strength of the company as a possible investment for outsiders remains unaddressed. Specifically, potential investors need to understand Aramco’s relationship with the Saudi government. This was only addressed at one point during the call when an analyst asked about Aramco’s dividend. According to figures provided by Aramco, the company paid $26.4 billion to its shareholder in “Ordinary Dividends” in H1 2019. This was almost identical to the amount paid in H1 2018. However, Aramco paid another $20 billion to Saudi Arabia in “Special Dividends.” This reflects an increase of $14 billion over last year’s H1 dividend.

In answering the question, Aramco’s CFO, Khalid al-Dabbagh, explained that Aramco’s executives and board of directors policy regarding the Ordinary Dividend is based on three criteria: sustainability, affordability and a benchmark. According to al-Dabbagh, such a high dividend in 2019 was possible despite lower profits because Aramco made more than anticipated in 2018. However, he did not address the fact that this incomparably high dividend is given because it is needed to satisfy a significant part of Saudi Arabia’s budget. Saudi Arabia, as a country, could not survive without this dividend and its royal family could not prosper.

Even more important are the implications of this dividend should Aramco go public. For example, will this type of dividend be available to the holders of publicly traded shares or will the Saudi government be the only recipient of “Special Dividends” or even the “Ordinary Dividends” from Aramco? If Aramco makes its lucrative dividend available to shareholders other than the Saudi government, then Aramco shares could prove highly valuable. On the other hand, if Aramco continues to fund the Saudi government through a dividend that is unavailable to other shareholders, then the public could very well find Aramco shares a highly unattractive prospect.