As of the time of writing, none of the organizations mentioned in this article are Intellyx customers. Digitization versus digital preservation. also weighs in on this term. But digital transformation goes the extra mile. 2. “Now we are on the way to digitalization, which is different. “Digitalization is the use of digital technologies to change a business model and provide new revenue and value-producing opportunities,” according to Gartner’s glossary. However, digital technology has also introduced the great debate: Digitalization versus Digitization. A digital transformation involves rethinking the company’s value proposition, not just its operations. Gartner’s definition is thus quite different from the academics’, focusing on changing business models rather than social interactions. In fact, it appears that Gartner is not of one mind on its definition of digitalization, as a recent Brookings Institute report quotes an entirely different one. Before I give you an answer to this question, I need to ask you two more questions: 1. Digitalization, however, is quite distinct from digital transformation. Digitization has a relatively straightforward definition, as we saw above – switching from analog to digital. Digitalization vs. Digital Transformation. Automation, as the term suggests, is the automatic execution of tasks without periodic interference.Whereas, Digitalization is the conversion of analog information into texts, photographs, and voices, among others. I have always been confused about where, when and how to use the words digitization, digitalization and digital transformation until I met up with an Associate Professor who explained the technical terms to me. Once you understand what digitization is vs. digitalization and how they fit into your larger roadmap for digital HR, you can set more accurate KPIs for transformation. Digitization, by its essence, refers to the conversion of information like pictures or sounds into ones and zeroes or a digital form that can be stored, processed, and transmitted by computers. Often the problem is that the new opportunities and challenges as well as the new opportunities are completely forgotten. People often get confused with the terms digitization, digitalization and digital transformation.They sound similar but in application, they are slightly different. Converting handwritten or typewritten text into digital form is an example of digitization, as is converting the music from an LP or video off of a VHS tape. Today, I go into three essential terms and look at them in detail. “It is the process of moving to a digital business.”. “‘Digitization’ and ‘digitalization’ are two conceptual terms that are closely associated and often used interchangeably in a broad range of literature,” explain J. Scott Brennen, Doctoral Candidate in Communication, and Daniel Kreiss, Associate Professor, both at the University of North Carolina School of Media and Journalism. But before you run out of hair pulling them out trying to make sense of how they differ from one another, here’s a handy guide to start you off. Digitization, digitalization, and digital transformation – all these terms are used to describe the processes in the digital world, however, they describe completely different aspects of it. Each term holds a different meaning. Digital Transformation is not just about implementing digital technologies or automating into the existing process but modifying the business model in a way to provide more customer value. Simon-Kucher & Partners Unfortunately, this latter definition is hopelessly vague. According to Gartner’s IT Glossary, “Digitization is the process of changing from analog to digital form” – a definition few would disagree with. Download the Video . Digitalization refers to enabling or improving processes by leveraging digital technologies and digitized data. Digitization, digitalization, and digital transformation are all terms that have been very prominent since the late 2000s. LinkedIn; 3 Minute Read. For example, image recognition programs can be used to read content from forms and transfer it to the system. Share. However, analogue and physically existing products are always digitally reproduced, copied or transmitted. by Mark Muro, senior fellow; Sifan Liu, data analyst; Jacob Whiton, research assistant; and Siddharth Kulkarni, former research analyst; all from the Brookings Institution. Digitalization vs digitization, digital transformations and automation are terms that techies frequently confuse. If one were to speak of completely digitizing a company, one would either have to digitize everything or just use robots and intelligent devices with IoT, since everything is digital. Digitization is the conversion of analog to digital and a sub-process of digitalization, where digitalization (the process) uses technology (digitization) to optimize the entire value chain and digital transformation is the effect of both that is collectively accelerating the global and societal transformation process. Creating this value requires a complete rethinking about the work itself. Digital business transformation is about doing things differently – creating new business designs by using digital technologies in combination to blur the boundary between the physical and the virtual worlds. In the final analysis, therefore, we digitize information, we digitalize processes and roles that make up the operations of a business, and we digitally transform the business and its strategy. The vast majority of traditional enterprises will have digitized their information by now. Digital transformation, in contrast, is not something that enterprises can implement as projects. März 16, 2020 Digitalisierung, Digitaler Wandel, Digitale Transformation – viele Begriffe sind im Umlauf um die aktuellen Veränderungen zu beschreiben. According to this definition, digitalization is more about business operations than either social interactions or business models – although clearly all of these notions are interrelated. If you’re ... A Structural Approach Towards Digital Transformation. Even though digitalization is often misunderstood for digital transformation, these 2 terms are significantly different. He is founder and president of Agile Digital Transformation analyst firm Intellyx. The vast majority of traditional enterprises will have digitized their information by now. In reality, these three terms have distinct meanings – or at least, we can make them distinct depending on which authority we’re listening to. Digital transformation is therefore nothing more than solving problems with the best possible technical means. Digitization, Digitalization and Digital Transformation has different meanings. A keypunch machine: digitization technology from the last century. Digitization vs. Digitalization – Wordplay or World View? Such agility will facilitate ongoing digitalization initiatives but should not be confused with them. This is not merely a matter of wordplay — it’s a matter of scope and potential value to your business. Digital transformation initiatives will typically include several digitalization projects, but executives that believe that there is nothing more to digital transformation than digitalization are making a profound strategic mistake. Companies often already use the term digitization when they digitize and automate their processes. By Jacqueline Prause. In the case of digitization and digitalization, two letters make all the difference. In digital transformation, for example, solutions are sought or problems reopened that are solved with the help of technology. By Kushagra Verma. list of top Digital Transformation influencers for 2018. We'll assume you're ok with this, but you can opt-out if you wish. Digitisation is the process of converting information from a physical format into a digital one. API enables digitization, API solution enables digitalization to save costs, and API product enables digital transformation to create new business. Digitalization has led to us having digital content. As far as Ross Philo, Energistics president and CEO, is concerned, these terms mean much more than simply acquiring more data. Jeder baut sich seine eigene Definition und in vielen Fällen bleibt ein nebulöser Schleier. And what has digital transformation got to do with it all? Before two decades, business … If you take the English definition of Google as “Digital Transformation” you will find “Digital transformation is the profound and accelerating transformation of business activities, processes, competencies and models to fully leverage the changes and opportunities of digital technologies and their impact across society in a strategic and prioritized way”. Kulkarni is now data science manager at Adobe. The technologies underlying digitalization continue to evolve rapidly, even as they are being adopted throughout business and society. In reality, people are confusing them in ways that shortchange the power and importance of digital transformation, thus putting the very survival of their organizations in peril. Serial entrepreneur since he successfully founded his first companies at the age of 13. ... Digital transformation is a word that describes the process of utilizing digital technologies to transform business operations. Is your company following a true digital transformation strategy? Published on December 28, 2018 December 28, 2018 • 3,565 Likes • 121 Comments According to the Brookings report, such change is at the heart of digitalization. The problem is that even the providers often make an unclear definition of the terms and it degenerates into a buzzword, which is simply misused for marketing. They have been used interchangeably, often for the wrong reasons have potentially not been given the importance they deserve. Digitization: The Beginning Of The Digital Age. Published on December 28, 2018 December 28, 2018 • 3,565 Likes • 121 Comments Firms can leverage the power of digitalization through agile transformation that provides value from day one and is constantly generating and analyzing data, guiding you with a roadmap as you go. “If you operate an online platform, then your company may already be 80 percent digitalized, and you can gain more efficiency or create more customer value by going the remaining 20 percent of the way.”. Whereas, Digitalization is the conversion of analog information into texts, photographs, and voices, among others. Transformation is indeed bigger, broader, bolder than either digitization or digitalization — it builds on those things but neither replaces them nor is a substitution for them. Beide Begriffe drehen sich zwar „irgendwie“ um die digitale Welt, beschreiben jedoch völlig unterschiedliche Aspekte der digitalen … The Brookings report, in fact, focuses on how digitalization impacts people. Where digitization is about efficiency and productivity, then digitalization is about experience, digital transformation is about invention and reinvention. Digitalization is also often used as a synonym for automation. Image credit: leighklotz. Digitization is an important enabler of digital, but all the digitization in the world won’t, on its own, make a business a digital company. This is digitization. Opinions expressed by Forbes Contributors are their own. Digitization Vs. Digitalization Vs. Digital Transformation - Can you tell the difference? As such interactions move away from analog technologies (snail mail, telephone calls) to digital ones (email, chat, social media), both work and leisure domains become digitalized. This involves constantly adapting to new technologies, adapting processes such as the supply chain and ensuring that people can network and exchange information with others. Digital transformation encompasses both digitization and digitalization. “Digitalization is transforming the world of work,” according to the report. For example when a bank scans a check to a digital image and stores this image instead of the paper check, the paper check and the manual storage of it has been digitized. It seems, therefore, that Gartner’s definition that ties digitalization to business operations is on point, as such operations consist of business processes that digital technologies can transform. Everything started with digitization. All Rights Reserved, This is a BETA experience. Summarizing you can say that digital transformation requires digitalization ‘en route’ to digital business (capabilities) and requires digitization, since the glue and a core business asset of digital transformation (and of digitalization) is obviously (digital) data, leading to information, knowledge, intelligence, action and business model changes. And, Industry 4.0 is European for the combination of Digital Transformation and Digitalization. How Do Employee Needs Vary From Generation To Generation? He is ranked #5 on Onalytica’s list of top Digital Transformation influencers for 2018 and #15 on Jax’s list of top DevOps influencers for 2017, the only person to appear on both lists. Digitization vs Digitalization vs Digital transformation – what is the difference? Digitization is the process of converting something that is physical and analogue into something that's virtual and digital. Digitization vs. digitalization vs. digital adoption. Whether it’s customer needs, innovative new products, market opportunities and challenges, or ultimately the “new economy“. Each one is necessary but not sufficient for the next, and most importantly, digitization and digitalization are essentially about technology, but digital transformation is not. And for that matter, what is a ‘business design’? Once one has an understanding of these issues, one can also solve them by technical means and use new technologies. Digitization, digitalization, and digital transformation are all terms that have been very prominent since the late 2000s. Here Is Some Good Advice For Leaders Of Remote Teams. Learn the difference between digitalization and digitization, with concrete examples of each so you have an idea of what true digital transformation is. But are you ready for digitalization? Digital transformation refers to the much wider use of digital technologies, implementing it into all areas of your business. Reality and misconceptions about the future of artificial intelligence (AI). However it looks the same, but they are different. To digitize something is to convert something from an analog into a digital format. Let's see how they are different. How Can AI Support Small Businesses During The Pandemic? As organizations implement ‘digital technologies’ – which in this context really means computers and other information technology – people’s jobs change. Digitalization – Digitalization refers to implementing a manual business process in technology and software. At Digital Business, we talk about digitalizing business units, business models and entire companies. This is not merely a matter of wordplay — it’s a matter of scope and potential value to your business. Digitization, Digitalization, and Digital Transformation The 3 D's are often considered to be a similar concept and the fact is, there are not. Digital transformation. Thus, existing processes can be digitally mapped or automated in order to save work steps. Digitization vs Digitalization vs Digital Transformation – Quick Difference Whether digitization or digital transformation, the two terms are used differently by different specialists. For example, the paper is not simply digitized and then processed, but it is considered, for example, whether the process is still needed or whether it can not be simplified with the help of a new technology. It’s important to remember, however, that it’s the information you’re digitizing, not the processes – that’s where digitalization comes in. Digitalization vs. Digitization. The difference between digitization and digital transformation is greater than you think, but many use it as a synonym. A kiosk in a restaurant to order and pay for food is an example of a formerly manual process now implanted as a digital service. In fact, for many people, digitalization applies primarily to such processes. While Digitization initiates the journey, Digitalization accelerates the business systems and makes it easier to access information. These can be films, images and much more. 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