This lesson is from Digital Transformation Handbook by John Palfreyman
|Source: Digital Transformation Handbook by John Palfreyman|
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 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 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.