Digitization vs Digitalization: What’s The Difference?

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Digitization, digitalization, and digital transformation are frequently used interchangeably, and it is critical to understand each notion. Understanding the differences between digitization and digitalization (digitization vs digitalization) is critical when developing a company strategy.

Digitization is the process of transforming information from a physical format to a digital version. While digitalization is the practice of utilizing technology to enhance corporate processes. In a nutshell, digitization relates to information, whereas digitalization relates to processes.

This post will help you understand the difference between digitise and digitalise, clarify things, and protect yourself from future confusion when using the terms digitize or digitalize.

DigitizationDigitalization
DefinitionTransforming analog data to digitalUtilizing technology to enhance corporate processes
is known as digitalization
Related toInformationBusiness Processes
Examples
1- Scanning a paper document
2- Convert music to mp3
3- Convert wet signature to electronic
4- Converting a paper map into digital
1- Video conference call instead of physical meet up
2- Automating work certificate processes in businesses
3- Ability to use ATM to deposit cheques
4- Audio conferencing, chat, messaging
Benefits
1- Faster access to information
2- Reduced storage cost
3- Improved digital preservation & archiving
4- Ability for integration
1- Efficiency & productivity improvements
2- Improved transparency
3- Faster & better decision making
4- Improved customer satisfaction
the table summarizes the difference between digitization and digitalization (digitalisation vs digitisation)

What does it Mean to Digitize or Digitalize?

The word digitalize has two meanings. The first meaning is the digitalization of an object. In this sense, digitalization means the conversion of a physical object into a digital version. The second meaning is the process of converting something into data and transmitting it digitally.

The term digitize has been used in many contexts such as digitizing books, digitizing music, digitizing information, digitizing video games, etc. It has also been used to describe the process of converting something into data and transmitting it digitally.

What Is Digitization?

Digitization is the process of transforming information from a physical format to a digital version. It refers to the act of transforming anything non-digital into a digital representation that computer systems may utilize to automate operations or workflows.

Gartner defines it as: “Digitization is the process of changing from analog to digital form, also known as digital enablement. Said another way, digitization takes an analog process and changes it to a digital form without any different-in-kind changes to the process itself.”

The goal of digitization is to make information more easily accessible, storable, maintained, and shared. Organizations can only increase their business operations efficiency and automate their day-to-day activities through digitalization.

In a digital enterprise, we start digitizing information by scanning and converting paper documents to a digital version, often PDF. This is frequently followed by the application of sophisticated methods (OCR) to allow computer systems to grasp the context of the document.

This digital format’s outputs will be the inputs to a workflow, a business process, or an enterprise system such as document management systems or enterprise content management systems.

For complete in-depth knowledge about document digitization, check out the post below

What is Document Digitization? Definition and Benefits (theecmconsultant.com)

Digitizing information is a labor-intensive process. It necessitates human work. It is a way to safeguard your most important papers, photos, and documents.

Digitization is neither good nor bad however it is a must for organizations to digitize information to make it easier to store, retrieve, and distribute, and it is the focal point for businesses to get the most out of information.

I strongly recommend reading the below article for a complete list of advantages digitization brings to organizations.

10 Unbeatable Advantages Of Digitization (theecmconsultant.com)

Digitization Examples

There are several examples of digitization including the conversion of handwritten text into digital form, the conversion of music and videos to digital, the use of digital signature, and the conversion of VHS tapes to DVDs or Blu-Ray discs

  • The conversion of handwritten or typewritten text into digital form.
  • The conversion of music from an LP or video from a VHS tape.
  • Conversion of analog VHS tapes to digital data-containing CDs, DVDs, or Blu-Ray discs.
  • One of the most important digitization examples is using a digital signature instead of a wet signature.
  • The conversion of paper maps to digital scanned ones including automatic data capture.

    Efficiency, dependability, predictability, and operational excellence are all important advantages of digitization.

What is Digitalization?

Digitalisation meaning: The definition of digitalization is the use of digital technology to transform a company model in order to improve revenue and value-added prospects. It is the process of moving to a digital business.

It incorporates the process of adapting old business models to new technologies and embraces digital technology’s potential to collect data, identify patterns, and make smarter business decisions.

The purpose of digitalization is to describe the process of enabling, improving, and transforming business operations through the use of digitized data and technologies in order to transform how organizations conduct business and improve productivity.

These procedures and interactions may not be entirely digital, but they do rely on digital technologies more heavily than they did previously.

We are surrounded by digitalization. whether it’s through social media, street advertising, or smartphone apps. Digital data has become an essential component of our daily life.

Digitalization necessitates the digitization of information. Organizations cannot embark on the digitalization path unless they have digital assets and automation is one of the most effective ways to implement it.

The automated execution of operations undertaken without human oversight is referred to as automation. RPA, or Robotic Process Automation, is one of the most prevalent types of automation technologies.

One of the most benefits of automation is the ability to automate business rules. They are critical to the smooth running of any business. They set goals, provide job performance standards, monitor compliance, and help organizations automate operations.

Organizations all throughout the world are adjusting their operations to be digitally compatible. Many businesses have already converted or invested in new business models. Consider communication, music, ebooks, and online shopping. This change will not spare any industry.

It is no secret that businesses must continually change in order to stay viable. In our current digital world, organizations don’t have any choice but to embark on the digital transformation journey.

Organizations may run more effectively, save expenses, and boost production as a result of digitalization. In Summary, it is a matter of life and death for them.

In a nutshell, digitalization is the process of leveraging digitization and transforming your business processes for digital.

Digitalization Pyramid

Examples of Digitalization

Some examples of digitalization include the ability to digitally stream movies on platforms such as Netflix, music on platforms such as Spotify, create a bank account instantaneously from your mobile, and buy and sell products on platforms such as eBay.

Digitalization boosts efficiency and production while lowering expenses. It enhances rather than transforms an existing business process or processes. That is, it converts a process from a human-driven event or series of events to a software-driven event or series of events.

Manufacturing will be transformed by digitalization. But it’s not without its drawbacks. While any type of business transformation is difficult, McKinsey estimates that more than a third of businesses fail to digitalize.

In our digital world on average, industrial companies plan on investing 6% of their annual revenue on digitalization over the next five years.

Automotive

One of the top examples of digitalization is how to change the automobile industry from a fuel-guzzler to a software-driven vehicle (tesla). Their production is increasingly digitalized and mechanized.

Banks

According to McKinsey research, banks can automate up to one-third of their operations with AI/ML to save money and eliminate human error. COIN, a data-driven automation tool from JP Morgan Chase, employs a private cloud network and machine learning algorithms to evaluate complex documents.

According to an estimate, the platform can accomplish routine activities that took up to 360,000 hours in the past in only a few seconds.

Movies

In the movie industry, digitalization spawned entirely new business models. One of the most examples of digitalization is Netflix, a digital media company. The success of Netflix was due in part to digitization, but it also necessitated a digitalization strategy.

To put it another way, digitalization enabled Netflix to build its subscription-based model and then integrate it across platforms such as the internet, App Store, smart TVs, and more.

What are the Pros of Digitization vs. Digitalization?

What are the benefits of digitization?

With the advent of technology, it has become easier for us to access information. Digitization has made it possible for us to have access to a lot of information and knowledge in a single click. This is something that we could not do before. It has also helped in making our lives easier and more convenient.

We can now use our phones and computers to do almost anything we want, from booking a cab to ordering food online, or even learning new skills like how to play chess or speak other languages.

What are the benefits of digitalization?

Digitalization is when an idea is converted into a digital format so that it can be shared with others easily and quickly. Digitalization is important because it helps in making things faster and

What is Digital Transformation?

Although business executives frequently use the term “digitalization” to refer to both digital transformation and digitalization, the two are not interchangeable.

Digital transformation necessitates a much wider use of digital technologies as well as a shift in culture. People are more important than technology when it comes to digital change.

It necessitates customer-centric organizational reforms that are backed by leadership, driven by radical corporate culture challenges, and the use of technology that empowers and enables people.

The term “digital transformation” refers to a shift in business activity, model, and competencies in order to make use of newly accessible technology.

Organizations are undergoing a digital transformation as they embrace new and creative business models based on technology advancements.

It’s the process of fundamentally changing anything utilizing digital technologies, and it refers to the use of technology and, perhaps, cultural shifts to better or replace what was previously available.

Digital transformation can help businesses grow into new areas, introduce new goods, and attract new customers. It also refers to turning digital data into actionable insights and subsequently transforming the way we do business.

Digital transformation is an ongoing process, not a one-time activity. It introduces new business models and alters the way businesses are conducted. It will go a long way toward ensuring that the end consumer is satisfied, which is the whole point of doing business.

For a complete list of the benefits of digital transformation for businesses, check the below article

9 Empowering Benefits of Digital Transformation That You Should Know! (theecmconsultant.com)

Conclusion: Difference between Digitise and Digitalise

Digitization and digitalization are parts of a digital transformation.

Digitization is concerned with events that have already occurred.

Digitalization is concerned with current events.

Digital transformation refers to events that will occur in the future.

What is Digitization?

Digitization refers to the act of transforming anything non-digital into a digital representation that computer systems may utilize to automate operations or workflows.

What is Digitalization?

The use of digital technology to transform a company model in order to improve revenue and value-added prospects. It is the process of moving to a digital business.

What is Digital Transformation?

It’s the process of fundamentally changing anything utilizing digital technologies, and it refers to the use of technology and, perhaps, cultural shifts to better or replace what was previously available.

2 comments

  1. Excellent abstract for a quick overview on Digitization, Digitalization and Digital Transformation. While I think it would be great if you add also examples for digital transformation.

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