Digitization, Digitalization, and Digital Transformation
The recent trend of digitalization, digitalization, and digital transformation has been around since the late 2000s. The most important thing is that they've not been given the attention they deserve because they've been used interchangeably and often for the wrong reasons.
Many executives associate digitization, digitalization, and digital transformation with one another. Providers themselves make unclear definitions of the terms, which leads to the term degenerating into a marketing buzzword.
Would you find it interesting to review the differences between digitization, digitization, and digital transformation and how they impact your business? The terms are crucial when referring to strategies and operations for businesses.
Have you ever thought about the differences between the three processes of digitization, digitization, and digital transformation and what they truly mean for a business? when it comes to companies and their strategies, the terms are very important. None of these terms exist without one another.
Let's look at these terms from the perspective of a business.
What is Digitization?
The process of digitization, also known as digital enablement, consists of changing analog systems into digital ones.
In Business, this process usually takes the form of initiatives such as modernizing legacy systems or moving systems online. A simple digital process is digitization, which is simply transferring non-digital data into a digital format that can be used by a computing system in a variety of different ways and for a variety of purposes. Therefore, no original document is lost during this entire process. Indeed, the original item is sometimes destroyed to free up space, but regardless, it remains in digitized form.
Digitization reduces costs and lays the foundation for business cases that leverage data to create value
Example:
The Finance or Account department scans all invoices files into PDF digital file formats.
Converting all Employee document to digital document.
What is Digitalization?
Digitalizing in the context of business usually involves leveraging the new technology and innovation brought about by the digital space to improve business operations, business processes, and more. Digitalization provides opportunities for businesses to set up new systems and achieve any or all business goals they may have in mind.
Businesses can become digital with the help of digitalization and increase their growth potential. For instance, a digitalization initiative could facilitate the uploading of these files to a cloud to accelerate collaboration and reporting processes and generate actionable insights to mitigate risks and encourage efficiency on future projects.
A concept such as digitalization is generally seen as a means to achieving digital transformation and securing new revenue streams.Digitization is necessary for digitalization to take place
Examples:
Moving PDFs and word documents into a shared cloud
Making personal resources with relevant data available to the business
Creating online, downloadable video databases
What is Digital Transformation?
In addition to enhancing the quality of products, services, and people, digitization is an important step toward digital transformation. The shift reshapes how businesses are conducted and value is created within an organization.
Technology is the enabler of digital transformation, more than just enabling existing businesses to utilize digital technology; it gives a business the ability to quickly adapt when needed through the use of technology and information.
The goal of digital transformation is to solve problems with the best available technology. As we've discussed, this applies to many topics such as "agile", "design thinking", "brainstorming" and other new approaches to problem-solving, since these are important elements in enabling a differentiated perspective.
The common definition
The definition of digital transformation is the systematic and accelerating transformation of business activities, processes, competencies, and models by leveraging digital technologies. This transformation must be strategic and prioritized to fully benefit from the opportunities and changes presented by digital technologies.
An analysis of digital transformation, digitalization, and digitization
In an era of digital transformation, digital data, digital business, and digital transformation combined are all essential elements of digital transformation
Digital transformation starts with customer-centric solutions
You have to understand that technology is not the trigger for digital transformation. Creating a new approach or solving a problem is always the goal of Digital Transformation.
With the advent of digital technology, we have access to digital content. Using this content to develop digital business strategies is then made possible using digitized processes. Transformations go further than that though.
Creating digital content, digital processes, and digital business models are essential, but digital transformation covers all aspects of the business. Whether it’s customer needs, innovative new products, market opportunities, and challenges.
Analyzing the elements of a digital transformation, one can see the connection between them. In most companies, digital tools and processes are used only for existing processes and business areas, only mapping the first benefits of digitization. A common problem is that new challenges and opportunities are entirely forgotten.
Why should we embrace digital transformation?
Your company can benefit greatly from digital transformation in many different areas. Digital transformation can bring about the following changes.
Operational excellence
Your business processes are more accurate and reliable when artificial intelligence, machine learning, and predictive analytics are integrated into your legacy systems. Furthermore, it makes your business more resilient and reduces future risks.
Customer satisfaction
A more user-friendly interaction platform for users can help you deliver an exceptional customer experience with digital transformation. Engaging users increase conversions and customer loyalty.
A competitive edge
You become more dynamic and agile as you progress through your transformation journey. With increasing market access, your brand can generate new revenue streams which can further boost your brand's success.
Embrace digital culture
By teaching your team members advanced skills and encouraging them to learn them, digital transformation strengthens their digital culture. This increases their awareness of the digital world around them and increases productivity.
A data-driven strategy
Embracing digital transformation will empower your business to be more data-savvy. Making better decisions, helps you optimize data collection, processing, and analysis. The insights you get from real-time analytics allow you to better understand market signals and changing customer preferences, as well as to measure how your actions work.
Let’s wrap up
A digital transformation journey can begin with digitization and digitalization. Creating a digital transformation strategy, determining where an organization currently stands, as well as leveraging the opportunities that come with each of these processes is possible when you understand the differences between these processes.
The need for business continuity has made digital transformation not just a trend but necessary. Avoiding this emerging trend could lead to you losing market share and falling behind. Think about what you can do to adopt even just a small portion of any of these three processes into your business.
DXSolution Advisor will help your company achieve complete, successful, digital transformation with our easy-to-use, no-code approach to digitalism. Connect with us.
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