The Essence of Digital Transformation: From Analog to Digital Excellence

Digitalization has become a buzzword. The purpose of digitalization is not just to convert something analog into something digital that can be read and processed by a computer. Digitalization also makes it easier to share data and identify patterns in large amounts of information. It can impact any company’s core processes and systems, from logistics and supply chain processes to customer insights and finance. So, digitalization is a process by which a company uses digital tools, technologies, and ecosystems to deliver greater value to customers through digital business models and to optimize and automate its own processes. Digitalization also happens whenever a company uses digital tools and services to reach its customers in a different way. It happens every time a company develops a new product that offers customers greater value. And it happens every time a company introduces a new technology that allows it to use digital technology to be better than the competition. Digitalization occurs whenever a product or service changes in a way that redesigns the customer experience or interaction model based on digital communication and media infrastructures. Digital transformation is therefore not just about converting a company’s files from paper to a digital format. Nor is it about introducing, for example, a new way of handling product complaints via a company’s website with a single measure. Digital transformation is the merging of several measures, projects and processes to take a company from an initial state of analog competence to an advanced state of true digital capabilities. In addition, digital transformation puts the customer at the center of all decisions and strategies. Companies that approach digital transformation with the intention of offering customers greater added value have the greatest chance of success. Digitalization therefore also means the networking of devices and objects – and thus also of the people who use them. Digital networking plays an important role especially in areas such as smart home and smart city. If the refrigerator is networked with the menu on the smartphone, it can communicate when groceries still need to be bought for a certain dish. In some cases, the refrigerator is even able to order these itself. This networking of objects is also known as the Internet of Things. The IT industry has high expectations of the digitization of everyday objects. Surveys on this clearly show thatthat experts expect increasing demand in this area. Applications of the Internet of Things in the manufacturing and industrial environment, the Industrial Internet of Things (IIoT), are also predicted to experience gigantic growth. The increasing proliferation of smart digital factories and utilities that require data analytics for real-time control and monitoring of industrial plants and their processes is driving digital connectivity. In particular, the demand for digital age technologies such as artificial intelligence (AI) and machine learning (ML) for industrial automation is driving digital connectivity between all connected systems and machines and contributing to the growth of the Industrial Internet of Things (IIoT) market and thus to digitalization.