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We may often hear the terms digitization, digitalization, and digital transformation. However, do you know the difference between them all? Or do you consider the same for the three terms? For that matter, we will review one by one what is called digitization, digitalization, and digital transformation to bring understanding about the difference between the three terms.

Digitization

Digitization is a process of conversion from analog to digital. Digitization refers to optimizing internal processes, such as work automation, paperless work, etc with the aim to reduce operational costs.

Digitization can be said as a process to digitize something, from analog to digital. The example of this process such as written documents (analog) turned into an electronic document (digital) in the pdf, doc, etc.

In the past, we listen to music from a magnetic cassette that often called an analog, however now we listen to music by streaming online via Spotify mobile app (digital).

Also, formerly we take photos using an analog camera using film but now we use the digital camera using a memory card as internal storage. There are many other examples of analog items but now has turned into digital.

Digitalization

There are several definitions that describe digitization. One of them is by Brennen and Kries which defines digitalization from an academic perspective. Both define digitalization as digital communication and the impact of digital media on contemporary social life.

The Gartner.com glossary defines digitization as “the use of digital technology to transform a business model and provide new revenue and value-generating opportunities; it’s a process of moving to a digital business. ”

Then, a new question arises, “What is Digital Business?”. Here, I-SCOOP offers an answer to the question, Digital business is the result of many digitization processes (for example, from supply chain to digital supply chain) and this is an important step towards digital transformation.

Digitalization will not exist without digitization. Digitalization is the use of digital technology and digitized data to influence the way a job is done, it changes the way company-customer interacts with it and creates new (digitally) revenue streams.

Digital Transformation

Businessmen often use the term digitalization to refer to digital transformation, even though the two are different. Digital transformation refers to the wider adoption of digital technology and cultural changes in it. Digital transformation puts emphasis on people/humans than digital technology.

Digital transformation changes the concept as an organization, to be customer-centered, supported by leadership, driven by radical challenges to corporate culture, and the use of technology that empowers employees.

It is important to know the difference between digitization, digitalization, and digital transformation. Business people think they can digitize business or digitalize business processes to be considered as digital transformation, but in fact, it is not that simple.

Misunderstanding these three terms often results in losing opportunities to develop, competing, having difficulty responding to customer desires and expectations, and failing to be a nimble businessman.

Therefore, from now on you must continue to learn about the digital world and digital transformation. You can contact IT consulting companies such as AsiaQuest Indonesia to just ask what the digital world and digital transformation is. We will be happy to be your business partner in achieving success in the digital world!

Reference:

medium.com

Photo by Kevin Ku on Unsplash