Digital Business Strategies in Blockchain Ecosystems

Organizations operating in this fast pace era must have a dynamic structure to be competitive in a volatile business environment both inside and outside. Automation and data are driving fundamental changes in our daily lives and in the way of doing business. In this respect transforming business processes call upon the technological advancements of two rising technologies of today: artificial intelligence and robotic process operations in finance sector is analysed in terms of their ability of business models in digital age. These two emerging technologies will lead to a transformation in the customer service model and internal operation processes in finance sector with current and future potential impacts. The institutions should prepare their business models and employees for this future in order to turn this development into an opportunity. In this study, it is evaluated that how financial institutions should change their business models in order to benefit from these two developments and a use-case of a bank has been shared.

As advancement in technology is on the rise in organizational setting as observed in other areas, human-robot interaction is getting more focused in both academic and practical studies. Social robots influence business life deeply and hence human life by changing organizational settings. This study aims to explore how the interaction between humans and robots affects the workplace and in what aspects we can explain the nature of sociality and collaboration with robots. It also aims to put forward advantages and disadvantages of human-robot interaction by presenting essential reference points and discussing many aspects of human-robot interaction in organizations.

This chapter focuses on Internet of Things (IoT) in blockchain ecosystems. IoT is a technological paradigm that bridges physical and digital worlds over a global network. There are a number of major challenges such as privacy and security. Blockchain can be a solution to these problems. In the literature, the subject is mostly discussed from technical and technological points of view. In this chapter, the topic is examined in a comprehensive manner including organization and business management perspectives. The chapter will begin with a comprehensive overview of IoT. Key features, different perspectives, developments and challenges about IoT will be described. The next section, blockchain based IoT as a solution to major challenges of IoT, will be explained. The relationship between IoT and blockchain will be described. Advantages of using blockchain for IoT, areas of usage, barriers and recommendations will be presented. Section 3.4 will be on its impact over businesses. Section 3.5 is devoted to emerging trends and future areas for research. The last section will conclude the chapter. Through the publication of this chapter, it is intended to be contributed to the literature on the Internet of Things and blockchain ecosystems. The chapter is expected to foster the research activities on the subject integrating organization and business management studies.

Today’s businesses have been evolving along with the technological developments, such as Industry 4.0, internet of things, and blockchain technology, in order to create not only fully digital and traceable but also transparent, reliable and secured environments. Blockchain technology serves for developing the transparency, reliability, and security characteristics of these environments even if it is frequently mentioned along with the monetary systems such as Bitcoin. The most common purposes to adopt the blockchain technology is to redesign and integrate processes, supply chains or financial arrangements. This chapter proposes such an Ethereum blockchain based framework called KanCoin concerning this potential in order to manage and adjust the processes for efficient distribution planning in blood delivery system from donors to distribution centers and patients at medical centers in a more effective way than the conventional procedures.

Nowadays, technology has become an indispensable part of our lives. Technology plays a major role in our daily lives, even in important areas such as health, banking and education. Being aware of this, organizations adapt these technological developments to themselves in order to satisfy customer needs in a timely and complete manner and not to fall behind in a fiercely competitive environment. In particular, organizations that want to develop web-based electronic sales networks and to be one step ahead of their competitors focus on digital transformation. Organizations have to carry out organizational change in accordance with these processes in order to sustain their commercial assets. Organizations create a digital culture by adapting their culture to the new format in order to be successful during this challenging process. Culture is the most important element for the continuation of the core values and the participation of the employees with least resistance. Thus, the study examines the effect of digital transformation and culture on this transformation process. Information is also provided about the digital organizational culture.

Despite the literature’s support that the main function to be affected by the Industry 4.0 movement will be the operations function, the rapid incorporation of new technologies under firms promises to affect each departments of the business dramatically. This chapter aims to highlight the role of each function within Industry 4.0. Moreover, the chapter will determine the actualized benefit of transitioning towards Industry 4.0, separate from the recognized benefits under the literature. In order to achieve this a content analysis was conducted on the 2017 annual activity reports of manufacturing firms listed on the Istanbul Stock Exchange (BIST). Out of the 178 listed manufacturing firms under BIST, only 20 were identified as transitioning towards Industry 4.0. Out of these 20 firms, 16 firms’ annual activity reports mentioned transitioning towards Industry 4.0 and addressed the outcome (benefits) of the applications. Items were subjected to a content analysis based on business functions (Theme 1), sub-categories of business functions (Theme 2) and the common actual benefit (Theme 3) by three different researchers. The unit of analysis, the identified benefits, were 232 items in total and spread across the operations (41%), strategic management (Cost and Competitive Advantage) (22%), technology and process development (15%), procurement and distribution (12%), human resources (8%) and marketing (2%) business functions.

Technology plays an important role in the lives of businesses. For this reason, today, it is not possible for a company to maintain its existence without using technology. In the digital age, along with increasing technology usage, the distance between businesses and consumers has disappeared. In other words, technology serves as a bridge between these two parties. With such technology usage in the activities of businesses, the companies have tried to reach their target markets by using their websites. However, today, they have also started to use social media networks as a way to attract their customers’ attention to their products and, thus, communicate with them more easily. In social media, it is not just the businesses that promote products and services. Consumers can influence each other’s preferences through comments that they share over social media. Their comments on social media are important in the promotion of goods and services. Therefore, it would not be wrong to say that social media is an effective marketing tool in today’s business environment. This chapter is aimed at examining the concept of social media marketing and its effects on the marketing activities of businesses.

Blockchain is one of the breakthrough technologies having the potential to dramatically transform the supply chains. In this study, potential impact of the blockchain technology on the supply chain management (SCM) will be investigated to reveal the nature of transformation that it can result in the domain. Based on a comprehensive review of recent literature at the intersection of blockchain and SCM, effects of blockchain on SCM are analysed under four titles: (a) basic characteristics, (b) transparency/visibility and traceability, (c) automated controls with smart contracts; and (d) trust-building and collaboration. Findings reveal that the technology is expected to provide accurate and trustable transaction infrastructure as well as true visibility and traceability across partners. With its potential to provide a transparent and trustable multi-partner ecosystem, it appears that blockchain will accelerate and strengthen the realization of a collaborative, IT-based network paradigm. Hence, findings of the study support that the blockchain technology will be a critical enabler of the transformation of the supply chains into tightly coupled, transparent collaborative ecosystems.

The new industrial revolution, Industry 4.0, requires digital transformation in all business operations including those of logistics. The digitalization in logistics operations, such as transportation, warehousing, inventory planning, sourcing, and return can provide firms high levels of flexibility and efficiency that are key to competitiveness in the era of Industry 4.0. In this regard, many buzzwords (technologies) are discussed in the discourses of Industry 4.0, emphasizing their key importance for the successful digitalization of logistics operations. However, the lack of clear understanding on these buzzwords and their interrelations is a barrier to firms’ determination of a clear road map for the digitalization process. For this reason, this study aims to initially introduce the Industry 4.0 enabling technologies (buzzwords), expected to be widely used in logistics operations in the immediate future, and then reveals the linkages between these technologies. To this end, this study applies the fuzzy-total interpretative structure modelling on the Industry 4.0 enabling technologies, which are big data analytics, internet of things, artificial intelligence, cloud technology, 3D printing, augmented reality, 5G connection, and autonomous vehicles. The results show that most Industry 4.0 enabling technologies are interdependent, but to different degrees. These results provide guidance on which technologies firms should primarily focus on to achieve digital transformation in logistics operations.

Currently we are facing the last industrial revolution, industry 4.0, which enables communication between humans as well as machines in Cyber-Physical-Systems (CPS). The concept industry 4.0 was first brought up in Germany. With the promises of the concept and increasing demand in cost effectiveness, flexibility, and sustainability, industry 4.0 has drawn considerable interest globally. The industry 4.0 era will lead to breakthrough chances in the business world. As the technologies of this era enable ubiquitous presence and real time information about each single piece of a process, it has been used in many firms in developed countries for some time. It is apparent that this new era will cause significant changes in our lives. Concepts of this new era such as cyber physical systems and internet of things have already gained considerable interest. Technologies that will be used widespread in the new future offer big opportunities for cost reduction and assessment of operations. Thus, the emerging developments in technology are closely followed especially by the logistics sector. Industry 4.0 involves numerous technologies and related paradigms (Thames & Schaefer, 2016). In this chapter, after a brief description of digitalization and industry 4.0, some main industry 4.0 technologies used in the logistics sector will be explained. Consequently, the advantages and disadvantages, and the possible opportunities and threats for the logistics sector will be discussed. Finally the current situation of logistics firms all over the world and specifically in Turkey will be discussed.

The introduction of computers in every field of life as the ever-expanding and widespread communication technology, cause significant changes especially in business life. With the internet and technology changing our lives radically, this change has also affected the management forms of enterprises significantly. In today’s enterprises, it is seen that the traditional methods used for the management of business processes are no longer sufficient. Business processes that are complicated in enterprises have become manageable only by using technology. Rapid developments in the internet technology have also diversified the understanding and operation of human resources management. Data and resource management of enterprises is more systematic and easily accessible in a digital environment. This situation has enabled most of the work done by the human resources department to be carried out in the digital media. Human Resources Management (HRM) has become Digital Human Resources Management (Digital HRM) due to this transformation. Enterprises now use digital human resources systems while carrying out their human resources functions. In this respect, while enterprises offer many innovations in the digital field to consumers, human resources management also applies similar innovations to employees or candidates. Therefore, digital transformation in human resource processes is more effective when used as part of a broader employment process. In this context, this study focuses on the use of digital applications in human resources management of enterprises. However, the reflections of digitization on human resources processes have also been elaborated.

Digitization in the workplace has already affected working methods and the working environment. The digital transformation of Human Resource Management (HRM) is one of the most discussed topics in recent academic studies. In that context, this chapter investigates the transformation of strategic HRM by big data and artificial intelligence (AI) technologies and the impact on business performance. First, we discuss the impact of digital technologies on SHRM and how big data and AI technologies enhance the strategic development of HR. Secondly, the role of technology in HR evolution from 1945 to the present is explored. It can be seen that as technology develops, business also changes the way it manages human resources. Third, the importance of the use of big data and AI technologies in HR functions is discussed. Finally, the ways in which HR contributes to business performance as a result of the digital transformation of HR are discussed. Suggestions and future directions are provided for both HR professionals and researchers to support overall business performance by transforming SHRM into digital SHRM.

Technology improves quickly and every object that comes into direct contact with life is being digitized. The developments in the field of information technologies and the need for digital transformation have led to a rapid change in the traditional ways of doing business. Both the biggest threat and opportunity comes from technology. It can bring on fail for the companies that don’t understand the technological developments correctly and adapt to changing environment. It has become an important issue to create a right strategic management model in order to enable firms to evaluate the opportunities and minimise risk during the digital transformation because every enterprise has a different approach to digitalization.

This chapter explains blockchain platform strategies for business transformation in a blockchain ecosystem. The blockchain platform, which includes specific transaction records and distributed ledgers for certain time periods, can be defined as (1) a core asset in a blockchain ecosystem, (2) a common basic asset, (3) an asset possibly generating derivative content and services, such as complements, (4) the hub in the value chain in blockchain technology-based businesses, and (5) an asset retaining blockchain technology.Blockchains can generate various complements within the context of platform leadership. This means blockchains can show the characteristics of complementarity. They bring about network externality and lock-in effect regarding platform leadership. Blockchain technology innovation is beneficial for production efficiency, cost reduction, and lowering prices.Blockchains can also be defined as the adjustment of existing approved transactions and derivative service providers as complementors. Blockchain platforms should promote the blockchain ecosystem for platform leaders and complementors so that ecosystem stakeholders can form competitive and cooperative relationships with blockchain platform leaders.

The alignment of IT management and business is the key factor for the success of enterprises. The IT management must take care and understand the business strategies and proceed in this context for the management of data, application and the infrastructure architecture. The business must also implement methods to transfer the logic behind the strategies, vision, organization, the processes to improve and the functions to develop to the IT management in a context of business architecture. Throughout blending business strategies with IT management, the enterprises can achieve more efficient business and IT operations, better return, reduced risk and complexity; so, the organization becomes more agile among different distribution channels, project and change management is easier and the software development costs will be lower.

Fast-growing technological features of today drive all companies in all sectors to mechanization with automation by Artificial Intelligence (AI). As the maritime and logistics sector moves toward fully digital, AI becomes significant competition element for leading shipping companies in business logistics and maritime nations. Although the use of artificial intelligence requires great investment in the short term, it brings profitability by reducing the costs in the long term. Moreover the environmental regulations of IMO (International Maritime Organization) will hit the maritime industry in 2020 by forcing maritime companies to reduce sulfur content in fuel at 0.5%. From this aspect, using AI will also contribute to reduce ship related carbon emissions by implementing environmentally friendly applications. On the other hand, profitability of seaports will scale up by using emerging technologies that helps accurate forecasts by using scientific innovations related with empty and full container records and their allocations. Moreover, using AI will contribute to the prevention of ship related accidents by anticipating future cases with using pinpoint calculations. Lastly, the basic requirement of implementing sustainable development which is necessary to compete is to follow and implement technological innovations as AI. That’s why this paper researches recent developments and current practices of maritime companies related with AI and shed lights on future studies in terms of shipping companies, maritime workers, governmental authorities and any other rule makers and practitioners.

The artificial intelligence (AI), which has started to show itself in every field of the changing business world, has now begun to manage the recruitment processes in the human resources departments of enterprises. With the adoption of new technologies in the digital age, business structures have to adapt to new designs and increase the performance of business processes. Providing the right human resources during the recruitment process is one of the most important functions of human resources management. In particular, it is important for an enterprise to find, attract and manage talented employees. A talented human resources department is the most strategic point that directly leads an enterprise to profitability. At this point, candidate evaluation stages are very important for a successful recruitment process. In this regard, it is important to have accurate monitoring and evaluation tools associated with the performance and potential of the candidates in terms of the organization of enterprises and management of human resources. In consideration of the foregoing facts, the aim of this study is to reveal the benefits and risks of AI-based use on human and community in recruitment processes in human resources department. The applications of artificial intelligence are explained with examples.

The digital age in which the Internet is located in the center has initiated a period that completely revised the whole marketing system from using traditional tools to using modern tools. Thus, this has led to the birth of digital marketing. Digital marketing can be defined as the marketing practices carried out by using digital channels such as internet, mobile, and interactive platforms. It provides cost advantage and competitive advantage for businesses through its distinctive features. New industries which bring new developments into economies such as new products and concepts are called emerging industries. There are several difficulties an emerging industry faces while entering into a market such as high costs, uncertainty, complexity, and instability. Traditional marketing may not be effective enough in these industries to deal with these difficulties due to the ongoing transformation in the technology and digital marketing. This is expected to present more useful and effective results. Therefore, the digital marketing potential in emerging industries will be presented in this study.

The new era in the business environment requires the hierarchical structures of the businesses turn into flexible structures, the companies to share the information by combining their competencies and resources. The travel industry must be in cooperation with a large number of actors, as it has to offer a wide variety of products due to its structure. These companies are also in competition because they offer services to similar markets. Buhalis (2000) states that tourism establishes networks to become more competitive compared to other corporate networks. These businesses, which face the “partnership of competitors” dilemma as stated by Hamel (1991), can easily compete in the global business world by adapting to the new structure.There are many businesses which perform their activities in order to provide services on the basis of a common business understanding. Operating in the same area but having different competencies and resources, accommodation businesses, catering businesses, entertainment businesses and traveling businesses are among businesses that experience the dilemma of competitor partnership in the broadest sense. These businesses blend in their understanding of cooperation with today’s technology, achieving the virtual organization structures rather easily. Therefore, this study addresses the network-based strategies of virtual travel organizations, which are in conformity with today’s management mentality. In this sense, the concept of virtual organization has been defined in terms of travel sector in particular. After referring to the concept of virtual travel organization, the structure, process and characteristic are discussed. In conclusion, several strategy suggestions have been made for virtual organizations. The literature does not include many studies explaining the strategies on the basis of networks and exhibiting the components that affect the performance of VTO. The study contributes to the literature in those aspects and can also be a significant source of information for field students, scholars and professionals.

Developments in communication technologies have enabled entities to benefit from new technological infrastructures with improved efficiency. In this context, blockchain, as a new, innovative communication technology, can provide a better solution that promises efficiency and improved transparency for every kind of transaction that involves value exchange including stocks, derivatives, interbank transactions, and accounting operations of entities. Today, whenever a value exchange transaction is needed between individuals or institutions, a regulatory and intermediary body is needed in order to ensure trustworthiness and transparency. Supporters of a blockchain called the “internet of values” argue that it sustains a more reliable infrastructure without any intermediary, unlike traditional systems that include regulators and intermediaries. Blockchains established by private institutions for intercompany operations give the decision-making authority of record approvals and monitoring ledgers to the system’s managers. Especially companies or institutions can benefit from these private blockchains without a need for a trust mechanism such as intermediaries. This chapter aims to exhibit the current accounting operation areas that blockchain technology impacts, s as well as the future direction of the integration between the technology and accounting.

The Information Age has led to the emergence of Industry 4.0 with rapidly developing technological devices making the data collection process much easier. Industry 4.0, which is also called the Second Machine Age, is expected to shorten the process, reduce margin of error and costs with the inclusion of self-learning robots in the production process. This shift will definitely have an impact on financial statements which depict the performance of a business organization. In addition, the items in a financial statement will undoubtedly change because of the use of virtual money, just-in-time production, and the decreasing role of humans in the production process being replaced by robots. In consequence, the financial analysis ratios will be modified in accordance with the changes in financial statements. This chapter focuses on the effects of Industry 4.0 on financial statements and financial statement analysis from a theoretical perspective. The possible effects of developing information technologies on financial statements and ratio analysis will be discussed.

The last decade has been quite innovative and revolutionary for both digital tools and financial reporting. Until now, auditing and assurance services have dealt with sorting mountains of data. With firms upgrading their business methods and internal control systems through the use of information technologies, it has become mandatory for those same information technologies to be used in auditing and assurance services. Accordingly, the quality of auditing has increased, taking out what used to be a drudgery for auditors. However, at the same time new areas of auditing and assurance services have opened up.There has been speculation about whether the accounting information system will replace what accountants do, that is, whether blockchain systems will replace auditors. It is undeniable that when used in the audit process, blockchain systems increase the quality of the audit without increasing the time spent on the audited data. In some articles blockchain is referred to as one open, unmodifiable ledger. When auditing financial reports based on this ledger, auditors are able to increase the number of samples they use, even up to including the entire data set without increasing their work-load or the time necessary to audit the integrity of the data. However, this introduces new technological and business risks that the auditor will need to assess.International Auditing Standards have not yet been revised in terms of how and when to use blockchain ecosystems and the risks that they create for external and fraud audits. This chapter will explain how and when to use blockchain technologies and identify the potential new risks that await the auditor. Since no definitive rules and regulations have yet been made, this study is based on the opinions of several professional bodies that are currently tackling bitcoin and other sub-tools that blockchain ecosystems are offering.

Following the recent Industrial Revolution, Turkey has demonstrated a strong willingness to digitalize their operations and incorporate Industry 4.0 components under firms manufacturing processes. Quickly gaining the support of the Turkish government, the 4.0 movement has flourished and presented researchers with a unique opportunity to compare the pre-post implementation outcomes of the transition. Considering the current international literature on the acknowledged benefits of the Industry 4.0 movement and the inherent cost of incorporating new technology under the organization, managers are naturally expectant that their technological investments results in deserved payouts. Firms have been long motivated in evaluating the potential payback of their investments. However, previous research has faced difficulties when analyzing the relationship between productivity and information technologies. By employing use of the actualized Industry 4.0 benefits under organizations, this Chapter aims to provide an assessment of the implementation outcome of the digitalization process and provides an in-depth understanding of the financial impact of Industry 4.0.

In accordance with the Industry 4.0 perspective that the developing and developed countries have focused on recently, accounting profession and members of this profession are required to play a new role. Nowadays, together with globalization and the improvements in technology, businesses have been influenced by Industry 4.0 which not only affects them directly, but also without a doubt influences the accounting science. The integration of Industry 4.0 into businesses influences accounting science, cost accounting and management accounting. Thus, this study is significant because it contributes to the relations between cost and management accounting, and leads the way for new research. In this study, the effects of Industry 4.0 on accounting science were investigated while emphasizing that the traditional understanding of accounting has been evolving into “Accounting Engineering”. The aim of the study was to investigate the Industry 4.0 effects on cost and management accounting. Within the scope of this study, the roles of cost and management accounting in dark factories, which have the potential to become the production business of the future, were discussed. This study suggested that the existing accounting perspective should be changed. As a result of completed studies, various suggestions in accordance with Industry 4.0 have been put forward to reduce human error and wastage, better manage time, increase production capacity and quality, reduce costs and provide a competitive advantage.

One of the most important economic problems that developed/ing countries are facing today is the informal economy. Unregistered economic activities are generally defined as all economic activities that are not included in national accounts. The informal economy has an informal structure as well as a criminal structure. Cyber-attack/s (CA) are increasing day by day as an important part of the informal economy due to the economic effects they produce. Credit card fraud, emptying a bank account, cryptolocker viruses that can be used to encrypt data on the user’s computer, the use of websites and e-commerce sites such as DDOS attacks, espionage, information smuggling, and many new computing crimes can be given as examples in this field. This study aims to evaluate the relations/determiners of CA-damages and information technology (IT) investments to firms’ economics and present the findings to the researchers/decision makers.In this sense, IT investments and CA/CA costs to 321 Zonguldak firms having more than 20 employees in 2016 have been surveyed by Turkish Statistical Institute. According to CA-damage severity indexes generated via TOPSIS, statistical methods and decision tree approaches supported by regression analysis are used in the analysis. According to the analysis, CA-damage increased as IT investments increased. IT investments dimensions’ existence of “website/mobile applications” and “IT policy implementation” accepted the main CA-damage determiners. Meanwhile, the firm’s less usage of firewalls/IPS/IDS indicates that CA are not fully understood, and the security policies’ application is also important along with its preparation.

The aim of this chapter will be to explicate about the Copyright in Digital Business. The study will begin with highlighting the overview of Copyright law and digital business scenario. The chapter will further scrutinize the issues and challenges associated with the Copyright in Digital Business. The present study hold a descriptive methodology by adopting secondary data from various organizational resources. The Intellectual Property has voyage to the internet both in substance and as a concept which has become imperative to the success of digital businesses. With regard to the Copyright on digital media, the holders are in quest of protection of their rights and aim to retrieval of their investment in intellectual creation. The study will try to find out whether current law and practice provide enough motivation for the supreme quantity and premier quality of original works to be produced and consumed in the present digital world. Further, it will try to find out the level of difficulty in terms of how the current copyright regime is competent enough to harmonize between private incentives and social benefits.

Blockchain is relatively a new technology that takes its roots from a distributed data structure shared on a decentralized network. Although the first attempts of the blockchain technology started in developing cryptocurrencies, this technology has provided opportunities for other fields related to the management of security issues and shared resources. Thus, studies on various aspects of the blockchain technology have formed a growing trend in the related literature. The objective of this chapter is to present the current trends, statistics, and relationships from the growing body of literature on blockchain technology. This research is supported by scientometrics, which is the methodology used to analyze data extracted from online scientific databases to obtain the major trends, research agendas, demographics, particular metrics, networks, and understand leading topics. This research is based on papers published in the Web of Science (WoS) and Scopus databases between 2013 and 2018. The intent of this research is to shed light on the holistic view of blockchain literature and to support the researchers and practitioners in this field.

The main aim of the study is to design the bases of the blockchain system and the creation of smart contracts and to generate a new blockchain in the financial payment system. In the scope of the study, the technology under the blockchain system and smart contracts examined. In light of the information obtained, a reliable, transparent, accountable simplified blockchain data structure as a result of intensive use of data and goods can be used in smart contracts in the financial payment system in tourism enterprises. In this context, utilizing the smart contract system consisting of continuous growth and structured data, it will be possible to dispose of the intermediary institutions in the transfer fees that can be used as a priority in the financial payments system. Content analysis was used within the scope of the research and examples of smart contract projects in the tourism sector were examined.

The aim of this chapter is to investigate the relationship between the jump dynamics of Bitcoin prices and the speculations by using high-frequency data. I measure the significance of the jumps using Huang and Tauchen (Journal of Financial Econometrics, 3, 456–499) nonparametric test and Google’s Trends statistics for the measurements of the speculation. Since the futures contracts on Bitcoin transactions plays significant effect on its volatility, therefore, this paper additionally tests the effect of the futures contracts on this relationship. The results show that there is a discrete jump in the Bitcoin price around speculations and the futures contracts do not have any significant effect on this relationship, but notably after the launch of futures contract, the speculations have much higher significant effect on the Bitcoin jumps.

In the backdrop of the digital revolution we are witnessing, value creation through conventional production of goods and services is being challenged every now and then. These days, the digital economy, from entertainment to shopping, forms a crucial part of millions and millions, but its value added is slipping through our grasp. The fact of the matter is that sizeable shares of the value additions these companies do are moved out of countries where corporate tax rates are high to the accounts of companies in tax havens. This means that the productivity gains achieved through the digital economy does not necessarily translate into increased tax revenues for the government. The big names in the digital business market, at present, have been accused of paying virtually no tax in those populous countries where they operate. For example, Google’s revenue reached about US$74.5 billion in 2016 and yet Google is known to be subject to low effective rates of taxation and even accused of deferring taxes on revenues over US$24 billion only in the United States. Other European countries like Italy, France and others have proposed to tax the income of these digital entities but somehow it never materialized. At the outset, the paper presents a theoretical model to show how that liberal tax laws have always been attractive for shifting profits. In this background, the paper discusses the outsourced holding company model of tax avoidance used by digital business platforms like Flipkart with a special focus on India and hence decoding the tax design that can be operationalized by the fiscal authority to ensure increased tax revenues from digital value creation under such a case.