The term “digital transformation” has been taking businesses by storm. What does that term mean? This article has the term digital transformation explained.
What is digital transformation?
Digital transformation (DT) is the practice of integrating digital technologies to create new – or modify existing – business processes. In other words, it reimagines business in the digital age. Its main purpose is to adapt to changing business and market requirements.
DT goes beyond the limits of traditional roles like sales, marketing, and customer service. Instead, DT has customers as the centerpiece from the beginning up to the end. Thus, it changes how businesses engage with customers.
Moreover, DT makes your organization future-proof. Doing business in the 21st century with sticky notes and handwritten ledgers won’t really take you a long way. However, many people interchange digitization, digitalization, and digital transformation. Is there really a difference between those three? Yes.
In simple words, digitization is the move from analog to digital. Not so long ago, businesses kept records on paper, like ledgers or typewritten documents. Gathering or sharing information meant dealing with physical documents, including binders, faxes, and xeroxes.
Then, computers entered the business and quickly became popular. Most businesses began converting all of those ink-on-paper records to digital computer files. Digitization has made finding and sharing information much easier.
The use of digitized information to make work simpler and more efficient is called digitalization. Take note that this is not changing how you do business or creating new types of business. Instead, it is about keeping the same business processes but making them faster and better.
To illustrate, digitalization has changed customer service forever. Employees can now easily and quickly retrieve customer records via computer. Gone are the days where records are trapped in a file cabinet somewhere in a dusty archive. However, the basic method of customer service didn’t change. But as mentioned, the entire process is now much more efficient. All you need is a few keystrokes on a computer screen.
Digitization and digitalization paved the way for digital transformation. DT changes how businesses get things done, not just doing the old things faster. Moreover, it involves taking a step back and revisiting everything you do – from internal processes to customer interactions both online and in person.
With DT, businesses of all sorts can disrupt any industry. Now we have digital transformation explained, let’s take a great example. Netflix is a great example of leveraging technology. The company started as a mail order service and disrupted the physical video rental business.
A few years later, digital innovations popularized streaming video services. Netflix once again adapted and began offering a growing library of on-demand content at ultracompetitive prices. Furthermore, the company extracted insights from data to make better decisions. What can we learn from Netflix? Take advantage of available technologies to make better business decisions.
Digital transformation is no longer a luxury – it is now a necessity. The COVID-19 pandemic has made that need even deeper. You only have two options – transform or go out of business. This article has digital transformation explained so bookmark this page now so you can easily access this guide!