Digital transformation is no longer just a matter. Businesses need to develop resilience and lasting power in this rapidly changing world. However, digital transformation is not a quick shortcut, it is a three-step journey:
Digitization, digitalization, and finally, digital transformation
Many businesses fail in their digital transformation because they rush to the last stage. This article will introduce these 3 stages of digital transformation and the differences between them. Most importantly, Binomial will give you unique insights to make each step of the journey stronger and reach the final destination.
Step 1: Digitization
Digitization means the conversion of non-digital documents and information into digital format.
In the digitization phase, companies often use peripheral digital technologies such as point of sale or digital goods. In addition, they can invest in remote experiences such as loyalty programs to prepare for new product launches. Generally, only the CEO knows the company’s next steps or plans.
Digitization is a good starting point for digital transformation. But the challenge of this step is less in receiving bits and bytes, and more in knowing what to do with that data. Therefore, if business owners want to take the next step, a clear business plan is very important and important from the beginning.
Step 2: Digitalization
Digitalization involves the conversion of processes or relationships into their digital equivalents.
In the digital stage, companies have a better understanding of what technology can do and begin to streamline and improve business operations using digital tools. This step also requires investing more in people, to train them to use digital systems. Examples include automated equipment monitoring, teleconferencing, and computer-based forecasting services.
The main difference between digitization and digitalisation is that the former deals with information and the latter refers to processes and people. However, the business model remains the same in both phases.
Step 3: Digital transformation
Digital transformation refers to new and disruptive business changes, where strategic decisions are made with the support of digital technologies.
At this point, companies can engage in customer branding to generate customer insights and build customer relationships. They focus on creating a comprehensive business process to create significant competitive advantage and achieve high and sustainable growth.
The big difference between the third stage and the first two is that digital transformation starts with a business transformation rather than technology.
In short, leaders must carefully determine which level is most appropriate for their current business environment when making this transformation. Whether pursuing growth or transformation, leaders must have unique strategic thinking, design thinking, and customer-driven approaches to drive effective strategies and actions at every stage of transformation.