Digitization, digitalization and digital transformation: the differences

 

Digitization, digitalization and digital transformation are three terms we use since many years but often in the wrong sense. An exploration of the differences as they do matter.

Recently we heard someone saying he wanted to digitize his business. It sounded weird. The digitization of an entire business: how do you do that? Turn everyone and everything in bits and bytes? Automate everything and replace humans by robots? Connect everything that is unconnected so far with the Internet of Things?

He didn’t mean digitize. Like so many of us (we are guilty too), he used the wrong term to express the idea of digitalization or digital transformation (both not the same), rather than digitization, and used the word digitization in the scope of digital business and digitalization in his journey towards business transformation which is again something else than digital business transformation – but let’s not go there.

There is no digitalization and no digital transformation without digitization (of paper and processes)

There seems to be quite some confusion regarding the usage of terms such as digitization, digitalization (two letters difference) and digital transformation. It’s less surprising than it seems. Some of these terms actually changed over time (and some, which seem new, already were used in a totally different context many years ago and then disappeared again) so not everyone uses them in the current meaning. Just for the term digitization we found about 5 different uses at the time of writing this.

Digitization or digitalization

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