Digital technology is revolutionizing everything about life today. Businesses today are rushing to become more digital and taking advantage of the technological disruptions to provide their customers with the seamless digital experience. With the push for digitalization across different industries, understanding how digitalization could help drive business is crucial in building a company’s digital strategy.
What it means to be digital?
Digitization and digitalization have become popular buzzwords in business. However, understanding the basic difference between the two is essential to have an effective digital transformation strategy. Going digital requires IT integration in all business processes achieving integration that goes beyond basic, disengaged, isolated digital capabilities provided by legacy systems.
- Digitization is transforming analog or physical objects into digital versions converted using intelligent capture and used to improve the workflow or business process. For some organizations, digitization is synonymous to going paperless. Intelligent capture transforms paper files into digital files stored in databases and used in a variety of automated business processes.
- Digitalization involves a combination of process automation, semi-automation, and
manual operations to create efficient, smart systems. Digitalization transforms interactions, communications, and business functions creating a digital environment for specific areas of business or the overall business.
The era of digital transformation
The ongoing adoption of digital technologies in business has pushed businesses towards further digitalization beyond IT industrialization. Across the various industries, businesses have found ways to steadily adopt digitization and digitalization into their organizations. This means that legacy systems are being replaced by automation of entire processes where information technology is has spread to both workflows and processes.
Industry leaders are now taking on full digitalization with a three-part response involving further integration bringing business leadership to the digital context and renovating their business model to create a digital ready model that maximizes their digital capacity to achieve optimal agility. The three-part response includes:
- Creating powerful, proactive digital leadership that adapts business leadership to demand for increased digital integration in the business. Leadership that promotes clearly identified digital roles within the organization and aligns digital strategy with the overall business strategy.
- Renovating the IT core to meet the digital demands of the current and future market employing a postmodern ERP paradigm utilizing cloud-based technology, diverse partnerships, and cultivating digital capabilities with big-data.
- Developing bimodal capabilities to move from IT adoption to full IT digitalization by leveraging disruptive technology to build new business models, integrate innovation, and employ new business model innovations.
Transforming Small and Medium Businesses through Digitalization
While digitalization is not as extensive or expensive in small and medium-sized businesses, it still is every bit as valuable in adapting to an ever-changing digital world. With today’s options for digitalization, SMBs have the opportunity to use digital transformation to streamline their business processes, improve business interactions with all their stakeholders, and provide seamless digital and in-store experience for their customers.
To make the most of digital transformation, SMBs can focus on digital transformations that answer persistent organizational challenges, improve customer experience and business processes, allow the business to stay technologically current. Choosing the right digital transformation strategy best suited for the organization allows SMBs to maximize their digitalization efforts to add value to their business.