Digitization vs Digitalization: Whats The Difference?

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Introduction

Digitization, and digitalization, are sometimes used interchangeably. It is crucial to understand each notion. Knowing the differences between the two is important while developing a company strategy. Digitization is the procedure of transforming information from any physical format to a digital version. Digitalization uses technology to improve corporate processes. Hence you can say, digitization relates to information and digitization to processes. Both can work together to transform organizations into digital enterprises. They provide more agility and performance improvements.

Read on to understand the difference between digitization and digitalization.

Digitization Vs Digitalization 

Let's understand the meaning of two terms before proceeding. 

What Is Digitalization?

You can define the term digitalize as the digitalization of an object. Also, it is the process of converting something into data and transferring it in digital form. This term can be used in many contexts like digitizing books or digitizing music. It can involve digitizing information or digitizing video games, too. 

• Digitalization enhances efficiency and production and also lowers expenses. 
• It improves instead of transforming existing business processes. Hence, it converts a process from a human-driven series of events to a software-driven one.
•  It simplifies the workflow and ensures clarity at each stage

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What Is Digitization?

It is the process of translating information from a physical format to a digital version. It is also known as a paperless office. Digitize applies to the procedure of transforming something non-digital into a digital representation. Computer systems may utilize it to automate operations or workflows.

• In other words, digitization is a way of changing from analog to digital form. It is also known as digital enablement which takes an analog process and changes it to a digital form.

• The main aim of digitization is to make sure that the information is accessible. It must be storable, maintained, and shared. 

• Organizations can improve their business operations productivity. They can automate their daily activities with digitalization.

Digitization Vs Digitalization Examples 

Let's start with Digitization Examples. For instance conversion of handwritten text into digital form. Some of the common examples are:

• Converting handwritten or typed text into digital form.
• Translating music from an LP or video from a VHS tape.
• Converting analog VHS tapes to digital data-containing DVDs, CDs, or Blu-Ray discs.
• Using a digital signature.
• Converting paper maps to digitally scanned ones. It includes automatic data capture.

Next comes the Examples of Digitalization. Some common examples of digitalization are the ability to digitally stream movies on platforms. For instance Netflix. Even music on platforms like Spotify, creating a bank account through a smartphone, and buying or selling products on platforms like eBay.

. Some of the Remarkable Applications are:-

• Manufacturing 

The manufacturing industry is estimated to be transformed by digitalization. There might be a few drawbacks. Since any form of business transformation is tough, make sure you follow the right path for effective digitalization.

In this digital era, industrial companies often plan to invest some of their annual revenue in digitalization over the coming years.

• Automotive

One of the use cases of digitalization is how to transform the automobile industry. It needs to switch from a traditional to a Software-driven vehicle such as Tesla. When production is digitalized and mechanized, the safety of roads will also improve.

• Banking

Banks can be digitized by automating their operations with AI or ML. It will not only save money but avoid human error. There are data-driven automation tools available to use in a private cloud network. They use machine learning algorithms to evaluate complex documents. Banking is a sector that needs security, trust, and availability. With advanced technologies, it is possible to provide customers with hassle-free service. 

• Movies

The entertainment and movie industry has taken advantage of digitalization. They have created new business models with it. One of the most popular examples of digitalization is Netflix. It is a digital media company that everyone is aware of. The popularity of Netflix is due to its many features. Digitalization supported Netflix to make its subscription-based model. It then integrates it across platforms like the Internet, App Store, and smart TVs.

These were some examples of both the technologies that we are aware of in our daily lives. 

What Are The Advantages Of Digitization?

With the rise in technology, it has become easier for everyone to go through the information. Now it is easier to access information and knowledge through a single click. There were many things we could not do before. Technologies have helped us in making our lives comfortable and easier.

You can do almost anything you want, using your smartphones and high-speed Internet availability. Be it booking a cab or buying a dress online, or even completing a course online, you can do it. Everything is available for searching and you won't even need anyone's help. Applications are user-friendly and quick. 

What Are The Benefits Of Digitalization?

When any organization or employees digitalize anything, it is transformed into a digital format. Thus you can share it with others in an effective manner. Digitalization is crucial as it helps in making things faster. The technologies behind digitalization are evolving at a much faster rate. They are being adopted throughout businesses and industries.

Digitalization is beneficial for an organization as it opens new ways and approaches. It determines how the organization beholds its role within its environment. It helps find opportunities for increased profitability. 

By adopting digitalization, organizations can start to build new value chains. It provides experiences that are interactive, collaborative, sustainable, and profitable.

Conclusion

When it comes to digitization and digitalization, the difference might be between two letters only. But it is not a matter of wordplay it is the scope and potential value of any business. Knowing the differences between these two approaches is crucial as digital advancements are taking place. Also, businesses are moving forward to digital technologies. It enhances visibility and eliminates inefficiencies in operations.

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