What does digitalization mean for your business and what should you do about it?

While Software continues eating the world, business is no exception. Software with digital hardware, which can also be called digital technology, means that you split the process into its atomic levels, store & process them electronically. You can do CRUD (create, read, update, delete) operations as well as control and analyze these pieces of information with a much more powerful computing power than a human brain has. You can automate a quite high number of tasks or jobs to the these machines so that operations can be run more man-free, error-free(as longs as you set up the system correctly) and be much more scalable.

Before we start, let’s be clear about some definitions :

Digital : “Digital usually refers to something using digits, particularly binary digits. ”. (Wikipedia)

Digitalization or Digitization:

Digitization, less commonly digitalization, is the process of converting information into a digital (i.e. computer-readable) format, in which the information is organized into bits. The result is the representation of an object, image, sound, document or signal (usually an analog signal) by generating a series of numbers that describe a discrete set of its points or samples. (Wikipedia)

So in this article I will refer “ Digitization” as a more scientific explanation of computer-readable information and “Digitalization” as a business processes side of computer-readable information generation and utilization.

With the advent of digital devices, an important amount of human activity has been transferred into another universe, which I would like to call “ Digital Universe”. This living universe is a trace of our daily activities as humans. As longs as new technologies like AI does not intervene for reproducing new kinds of information on top of that, this universe will have been just a blue print of what we do, of course limited to our usage or more accurately to exposure to digital information collectors and generators(all digital electronics, including smart phones, all the sensors in IOT space etc.)

So, when you think about it, there is a degree of digitization in every human activity or process. The degree of that digitization is like a resolution of a photograph. The more detailed you want to have a photo, the more digitization you should do on it. This analogy makes more sense when we think about a more complex system ( a business app or a module for instance), rather than a specific object (like the photo example we used). So let’s think about how detailed information you want to keep in your CRM. Let’s say that you want to keep hour and minute detail of what your sales teams do in daily routine as well as their exact location should they visit your customers. Or consider the information you want to keep for your customers, from their tangible information like, name, address, birthday to more abstract ones like their sense of humor etc. As you can imagine, the depth of that information can be immerse, therefore we should stop at some extent not to load unnecessary details in our database. So the amount of depth you want to include and track in your system is called degree of digitization.

When it comes to degree of digitalization in business, I would like to refer this as an overall degree of digitalization used in business operations rather than the depth of each digitization. Namely, what type of applications a business uses for its operations: CRM, ERP, MRP, CMS, DMS, QDMS, SRM etc and how much and how well these softwares communicate with each other to represent the business in “Digital Universe” as a whole. This is particularly very important due to the fact that by transferring your business processes into this Digital Universe , you are enabling your company to use “machine power” , “computing power”, “analytical power” as well as “brain power”. The more information is available in digital universe, the more you can do with it.

Below, I am giving some examples about the benefits of using digitalization in your business:

  • Automation: reminders, reporting, business process management etc. which will save your employees time to be spent more value added operations.
  • Analysis: When you use digitalization in your business operations, it is like you are video recording your activities bounded to the depth and type of information you are collecting. Contrary to conventional ways of doing business, which only use paper or spreadsheet for information if nothing, you can analyze and improve your operations and measure the effect immediately enabling you to iterate process improvements continuously. On the other hand, if you are not using digitalization, to be able to improve any business operation you should do time consuming and one time business analysis which will only show you a snapshot of the time these analysis are carried out, making it obsolete when any business conditions change in the future.
  • Better Management: There is a famous saying that if you do not measure something then you can not manage it. Therefore, the more you measure metrics in your business, the better you can manage. So you should consider to apply deeper digitalization for your business operations:
  • CRMCustomer Relationship Management Software: You can improve the depth of your CRM by adapting more features for your business like Marketing Automation, AI implemented CRM tools etc.
  • OKRObjectives and Key Results Software: With the application of OKR software for your company, you would increase engagement level of your high level managers as well as white-collar employees.
  • Corporate Plans Management Software: Generally, companies are new to use software for their high level management operations. Therefore, there is a good potential to become one of the early adaptors to use that kind of digitalization for your company. You can adapt all kinds of planning and operational processes digitally, like:
  • 3–5 Years Strategic Plan Management Software,
  • Yearly Audit Plan Management Software ( both financial and operational audit plans),
  • Yearly Operational Plan Management Software,
  • HR career plan Management Software,
  • HR Performance Management Software,
  • Task Management Software to keep track of the duties.
  • Client Management Software or Client Portal Software: You can improve your business processes by implementing a client module for your customers.
  • Business Intelligence powered by AI: Consider you hire a collection of smart business analyst guys continuously analyzing your data and suggesting new strategies for each processes. After that, you decide which strategy to adapt your company and then evaluating the results after a certain time. With the advent of AI, if you have big amount of data, you can apply data analysis techniques (machine learning, deep learning etc. algorithms) to predict feature or simply deciding on a business case that is new and someone real should respond after evaluating. This is super powerful that you can make big winning decisions like what would be the result of that marketing campaign provided the budget etc.

So you should definitely start implementing more digitalization to your business processes. The caveat could be security, but the world is changing even the billion dollars companies uses these technologies so why you lag behind.

Alkan Balkaya, is an engineer, a finance manager, a co-founder, an entrepreneur, a software developer, a husband, a father, a soccer player, a windsurfer, a good swimmer and a businessman. He has founded more than 5 companies and still in the executive board of several companies. Right now he spends his time on R & D projects at Albert Solino and founding a new venture, Corvisio. Corvisio is a business management software company focusing on Strategic Planning Management Software, OKR (Objectives and Key Results) Software, Professional Service Automation Software, including CRM, Project Management Software, Client Portal Software. Corvisio is based in San Francisco Bay Area.