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Digitization or Digitalization? High rate tech concepts in the loop.

September 30, 2019

Nowadays we see a new wordage trend that ignites the confusion around some key tech concepts, like digitization and digitalization. At a first glance seems to be commutable. However, semantically, these concepts are as different as apple and Apple J.

Digitization: the clear-cut concept

Digitization essentially refers to taking analog information (aka paper-based processes) and transform it to digital data by encoding it into zeroes so that computers and devices can store, process, and transmit such information. According to Gartner’s IT Glossary, “Digitization is the process of changing from analog to digital form”. Simple as that!

It is important to remember, however, that it is the information that is being digitized, not the processes – that is where digitalization comes in.

Digitalization: the Lady in red

On the other hand, Digitalization refers to enabling, improving or transforming business process by leveraging digital technologies and digitized data. That means that digitalization presumes digitization.

If we go to Gartner’s IT Glossary we find it defined as “the use of digital technologies to change a business model and provide new revenue and value-producing opportunities; it is the process of moving to a digital business”. So digitalization is the next obvious step in the development of the company and therefore, can be described as an innovative way of doing business. It is the utilization of technology to create customer experiences, to become agile and unlock new values and potential.

In conclusion, we digitize information, we digitalize processes and roles that make up the operations of a business. Each one is necessary but not sufficient for the next, and most importantly, digitization and digitalization are essentially about technology.

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