The difference between digitisation and digitalisation

The difference between digitisation and digitalisation

Digital transformation – of which digitisation and digitalisation are a part – is reshaping the Australian business landscape. In fact, joint research from Microsoft and IDC Asia Pacific suggests that digital transformation will contribute as much as $45 billion to Australia’s economy by 2021.

The research showed full-business transformation can increase productivity and reduce costs but it’s a big undertaking, often involving restructuring a company’s entire infrastructure. Digitisation and digitalisation are much simpler, and where the wider transformation process typically begins. So what are digitisation and digitalisation, and what are the differences?

People in front of a laptop with man's hand pointing at screen
Digitisation and digitalisation could be key steps in securing the future of your business

Part One: Digitisation versus Digitalisation

Defining Digitisation

Digitisation is the act of converting something physical to something digital. In an office environment, this could be as simple as scanning a printed document and storing it on the company’s network.

Defining Digitalisation

This is slightly more ‘bigger picture’. Digitalisation is the act of changing business processes through the use of digital technology. Some companies up-end their entire business model by digitalising, which in this context would make it the same as total digital transformation. The key purpose of digitalisation is not just to “go digital”, but to add more value or opportunity to the business through modern means. It can be a small or large-scale change.

Digitisation is a part of digitalisation, but digitalisation can be so much more

Key differences between the two

Comparing the two terms, we see that digitalisation is far more than just digitisation. The former is quite a simple thing, and may not even need to be a part of a wider transformation effort. It is quite simply the act of digitising physical things. While this is an excellent first step on the road to streamlining your business and indeed improving security – less physical files to lose, damage or have stolen – you could theoretically stop there and the process would be complete.

Digitalisation expands on this, focusing on processes. It exists to help businesses expand into new markets, or as is common in Australia, compete with overseas competitors who are expanding into ours. It also allows you to offer new products and services that were previously non-existent or too expensive, which may appeal to a broader set of customers.

  • Example: Look at what retailers are doing. Many are offering a more seamless integration between digital and brick and mortar stores – browse online, shop in-store (or vice versa). Indeed, an Accenture survey found that 68 per cent of millennials demand this seamless integration. They want to be able to go from digital to physical and back again without interruption

Digitalisation can and should apply to more than just retailers, though. In healthcare it could mean storing more information digitally, and using data analytics to track patients’ health and predict signs of future ailments. In hospitality it could be as simple as offering online booking and food orders. In accounting it might mean automating reports, or creating a digital document management system.

However for digitalisation to work in your industry, it must always be value-adding.

Person holding smartphone at cafe in front of table with coffee and cake
Many customers are calling for seamless integration between physical and digital environments

Part Two: Simple ways to transform your business with digitalisation

Complete digital transformation is hard. Worth it, but hard. Therefore an incremental swap to digital technology is often a good way to test the waters without requiring a vast amount of up-front capital and human resource.

Because every business is different, we can’t necessarily tell you specifically which elements of digitisation or digitalisation will work best for you. That said, below we’ve brainstormed some simple and widely useful tips that will help you start:

All digital change should start with a ‘why?’ – a clearly defined goal

1. Setting goals

From a simple transformation such as installing new scanners to a more major change such as expanding your business offering, all digital change should start with a ‘why?’. One of the main traps CEOs fall into, according to author Jurgen Meffert writing for McKinsey, is not understanding digital correctly. That is, rolling out new initiatives to achieve certain means without fully understanding how those will (or won’t) impact the business.

So you must start with your ‘why?’ – why do you want to digitise or digitalise your business? Set clear goals and ensure they align with your wider business goals, as digital technology is meant to help you reach these. If you want to grow your customer base, you may need to look at increasing productivity or automating certain tasks. If you just want to add more security, a careful document management system could be enough.

2. Document management

A document management system is the storing, managing and tracking of digital documents. Digitisation is a major part of this, as true paperless systems are not always possible and therefore physical documents are required, but must be easy and fast to digitise.

The best systems of this type utilise a variety of both hardware and software. Your office will need a series of high-speed or even portable scanners that can link with a document management software service, whether that is installed in-office or via the cloud. In this way, you should be able to scan a document and instantly send it to the right person or the right folder, and be able to find and access it at any time in future.

3. Staff collaboration

One of the major reasons businesses turn to digital technology is to increase collaboration between parties. Collaboration can have massive positive effects on a company and absolutely must be encouraged. A Stanford University study helped prove this, finding that participants who were encouraged to work together persisted longer on challenging tasks, performed better and enjoyed the task more.

These are a few small digital tools that can encourage greater collaboration in your organisation:

  • Communication: We don’t need to tout the benefits of fast communication. But phone calls and in-person chats aren’t always practical, and email is often too slow. Many organisations across industries use instant messaging platforms such as Google Hangouts or Workplace by Facebook to facilitate instant digital communications as an alternative
  • Task management: If multiple staff work on the same tasks, a digital project or task management system such as Trello, Asana or Yammer will streamline the process and add a more thorough record of progress. That’s because people will be updating the system that everyone else sees, adding comments, marking tasks as completed and working towards the same, clearly defined goal. No paper required
  • Document sharing: The fast sharing of documents is key to smooth process. Your document management system is vital to good collaboration, especially if your work must include collaborators in other offices (or even countries). When finding software to complement your digitisation efforts, ensure that you consider how easy it will be for multiple staff members to work from the same document using this new system

4. Customer data

Accessing customer data is vital to true digital transformation. Even something as simple as offering personalised recommendations to customers requires the efficient capturing and processing of data.

At minimum, good customer data can help define the next stages of your business strategy – you’ll know the who, what, where, why, when and how of your customers and be able to pivot your offerings to suit. On a greater scale, data analytics combined with the likes of machine learning can start to automate certain practices – like those recommendations we mentioned earlier – to create a more meaningful customer experience without requiring extensive staff intervention.

There are many data providers in Australia and we would encourage you to talk to a number of them before making any decisions, to ensure you get the right offering.

The next step on your digital journey

The next step for you on your journey to digitalisation is to invest in the right systems. At Brother, we can offer the exact technology you need to begin digitising your physical information. We have state-of-the-art scanning devices with the latest security controls installed, which can easily integrate with third-party document management and cloud services to maximise your productivity and collaboration.

Get in touch and speak with our expert team about your needs.

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