permalink: /digital-transformation/terms

This lesson is from Digital Transformation Handbook by John Palfreyman

Terms

Source: Digital Transformation Handbook by John Palfreyman
Source: https://www.amanciobouza.com/amp/api-and-digitization-digitalization-and-digital-transformation

Digitization

• Digitization refers to creating a digital representation of physical objects.

• Digitization itself has no business value. However, it lays the foundation for business cases that leverage the data.

Digitalization

• Digitalization refers to enabling, improving or transforming business process by leveraging digital technologies (e.g., APIs) and digitized data.
• The business value of digitalization consists typically of efficiency regarding:
  • cost reduction,
  • speed, and
  • simpler business processes.

Digital transformation

• Digital transformation is the profound transformation of business activities, competencies, and business models to fully leverage the opportunities of digital technologies.
• The business value of digital transformation lies in transforming business activities, competencies, and business models to adapt to changes.

Definitions: in context of API

• Digitization: Creating a digital representation of physical objects. It’s doesn’t provide business value by itself. However, it enables to create business value.

• Digitalization: Enabling, improving or transforming business processes. The business value of digitalization is efficiency.

• Digital transformation: Transforming business activities, competencies, and business models. The business value of digital transformation is creating new business models and adapt to market needs.

Employee timesheets: from Paper-based capture to a digital workflow

• If the timesheets were filled in on a paper form which is photographed on a smartphone and emailed to head office, this is an example of digitisation.
• If there is an online way (web or app-based) of capturing and submitting time worked, this is digitalisation .
• If this online capture is fully integrated with forecasting, billing and project management systems, this is an example of digital transformation.
• Strategic value increases as we move up the stack from digitization to digital transformation.