Digitizing, Going Digital, and Digital Transformation: A Guide for Business and IT Visionaries
Ah, digital transformation. It’s one of those modern-day jargon that you’re quite tired of hearing, but it just won’t go away. And with good reason – companies are now fully embracing the many ways that technology can improve our lives. It’s no longer a vanity investment (well, for the most part) nor is it a necessary evil. It’s simply integral to us as professionals in the workplace or us as individuals. Technology touches on every aspect of our lives, and can only get better from here.
Now, while digital transformation is a term in people’s mouths again, it’s not alone. I’m sure you’ve heard a colleague say “we’re digitizing” in casual conversation in the pantry or a partner say “we’re going digital” during a corporate event. Then they go on talking about their projects, and you realize what they’re referring to is totally different from what you thought they were doing. That’s the thing, though: these terms add up to the hype but they also add to the confusion. These three terms: “digital transformation,” “digitization,” and “going digital” have been doing the rounds in the business and tech world and are used so interchangeably that at this point, what they all mean is “our company is buying some shiny new software or hardware that you haven’t heard of” And this is where the problem lies – not having a pragmatic and universal definition of these terms also makes it hard to assess whether one initiative is a success while another one is not. This also lowers the perceived value of these initiatives to an organization, almost to the point of this whole digital wave being considered a big joke to those who don’t truly understand it.
Then COVID-19 pandemic came, then all of a sudden, digital transformation hot topic yet again. When the world got profoundly disrupted and everyone had to stay at home, digital was the savior. After all, it was the only way to ensure business continuity without putting the lives and livelihoods of individuals at risk. Over the last two years, both IT and business professionals had to unlearn all the misconceptions about digital transformation and are now learning what it truly means for an organization.
BlastAsia, the team behind Xamun, is no stranger to digital transformation. As a software company, we are intrinsically digital. We were our first home-grown product’s first customer. Built over 10 years ago, it was a project management, HR management, support ticket management, and more – in one single app. Think of it as our “operating system” outside email, word processors & spreadsheets, and video conferencing. In fact, we used it for over 5 years before moving to another product that we built ourselves, which we will touch on later.
Throughout that process of building our first and second product alongside doing digital transformation consulting for some big clients, and research done in-house and by other organizations, we’ve resolved these terms and what they truly mean. This is what we’d like to share with you today.
Let’s start with digital transformation (or DX to some of you). We define digital transformation as an umbrella term that involves a series of changes in how a company operates/does business, leveraging on digital technologies. What this means is, there really is no one activity, no one technology, no one software that would say if you do/implement this, you’re definitely undergoing digital transformation. It’s a strategic move, a decision made top-down or bottom-up in any organization, to say that they are embracing digital solutions to perform better as an organization. But the caveat there is in the term itself – it has to be transformative. Adopting file-sharing on the cloud or online booking of services are not, in and of itself, digital transformation. It’s a culmination of different things and its effects to the lives of internal stakeholders as well as external stakeholders are profound. Also, it’s not a single-quarter or even a single-year endeavor. DX a going concern that as with everything else in business – it constantly evolves. It’s not about saying “we’re going to be digitally transformed this year,” but more like “we’re kickstarting our digital transformation this year.”
At BlastAsia, we believe that digital transformation is actually comprised of two key phases. These phases are those other two terms that I mentioned earlier: digitizing and going digital.
The definition of digitizing (in our heads) is this: Digitizing (or digitization) is bringing traditionally paper-based transactions and backend processes into the digital space for operational excellence. This definition is inspired by “Designed for Digital: How to Architect Your Business for Sustained Success” by Jeanne W. Ross et al. By digitizing, you not only make information available and accessible digitally, but you also automate and integrate processes.
An example of digitization is implementing an internal ticketing system for your IT department. Let’s say your work laptop conked out. You submit the IT support ticket in a web or mobile app, and the information about you, your laptop, and what’s wrong with it are stored digitally. Then it is routed to the right IT professional(s) either through email or their own web or mobile app. They either reach out to you and perform remote troubleshooting, or they pick up the laptop/ask you to send it so they can have it fixed. And once the laptop is back in your hands and working properly, you confirm that the ticket as fulfilled or done. Perhaps you fill out a satisfaction survey after a day or two just to give feedback. In this scenario, the fundamental task at hand of fixing the laptop is not done within the ticketing system. It simply helped record the ticket, monitor the status, and most likely give the IT department some CSAT. The value these bits of information and insight should not be downplayed.
Without the ticketing system, it would mean you’d have to write an email to the IT department. While writing an email not much a big deal, you’ll either write too much information that is necessary, or too little information that there would be a lot of back-and-forth with the IT professionals. It also is prone to being forgotten or overlooked, instead of having a system that can remind the IT department if the ticket has not been moving for quite some time now. Then you’d also have to send an email to follow up on the status of the repair, when you can see it immediately had you invested in a ticketing system. Then lastly, without a ticketing system, the IT department may not have easy access the right insight from let’s say a dashboard so they know if any area of the support service needs improvement or not. All of the inefficiencies addressed by a digitization effort such as rolling out a ticketing system is exactly the operational excellence that we defined earlier. It makes organizations just perform better, like a well-oiled machine.
[Sidebar: some people also use the term “digitalization,” but we think it’s essentially another way of saying “digitization.” Others would disagree by defining digitalization as a totally different kind of initiative surrounding the business process automation, however we feel that because they’re also quite spelled similarly just adds to the confusion that clarifies it. We clubbed it together with digital data because let’s face it – doing one or the other does not add much value to an organization. Now back to the point of this article.]
Moving on to the other term: going digital. We at BlastAsia define it this way: going digital entails rapid business innovation that shifts a company’s business model & value propositions by way of digital offerings. (Ross et al called this term “digital” but we want to turn it into a verb because it just makes more sense). There are two key differences between digitizing and going digital embedded in that definition. The first is “rapid business innovation.” Essentially, this means iteratively coming up with new ways of solving problems. In contrast with digitization whose end goal is to drive efficiency, the end goal of going digital is in the second part of its definition: to essentially arrive at new ways of value creation.
Let‘s break this down further through an example. Imagine owning a chain of gyms. You have multiple branches across different neighboring cities, and you hire a digital transformation consultant. The consultant goes to you after doing customer research and proposes to create a diet-tracking app for your members. At first instinct, you would go “Hold on expensive consultant, our core competency is in providing a space for people to work out using machines and weights and having personal trainers available for guidance. What does it have to do with a diet app?” But that’s the thing about going digital. It may or may not directly address what you’re already providing your customers.
Kotler's 5 Product Levels Model
In Kotler’s Five Product Level Model (see diagram above), what you described as your function as a gym is basically the Expected Product. And you can digitize the heck out of your gym (like a having booking system for trainers, or a subscription management tool with auto-charging to your customer’s credit cards). But these do not have a fundamental shift in your business model, nor it provides a change in value propositions. That diet app example is more of an Augmented Product at best to your current gym members. However, what really changes the game here is that non-members of your gym can actually subscribe to your diet app. This expands your market much further and even serves as a differentiator for your gym to attract non-members even. Furthermore, the diet app can not only track the end-user’s food consumption, but it can also suggest food items or dishes provided by a third-party health food grocer or a restaurant. Or even suggest dieticians or nutritionists near them. This essentially also shifts your business model because you now have new partners, new activities, and new resources that would have never been in business with you as a gym. Ultimately, your business is not just providing a place to work out (a gym), but a total fitness solution provider that takes care of people’s well-being in a more holistic manner.
[Sidebar: it might help if you read up on the business models and using the business model canvas in your digital transformation planning here.]
As we said, digital transformation is broken down into two phases: digitizing and going digital. It’s not a matter of choosing one over the other. You must digitize first before you go digital. What digitization does is it provides solid operational backbone to successfully go digital. We also used to think that going digital and digital transformation are essentially the same. But they’re not. What we realized is that there really is a need to break down digital transformation into two phases to ensure success.
Digitization alone requires A LOT of changes in how people – particularly internal teams –do their work and this needs time. Let’s look at that gym example again. Imagine if, without digitization, your gym goes from doing everything manually to all of a sudden utilizing the diet app to support the extension and new activities that it’s supposed to do. That’s a recipe for disaster because once you get into going digital, you basically “open the curtains” or bring your customers into the entire process (see diagram below). If the backstage (i.e. your internal operations) is not digitized, the resulting frontstage action will be a huge mess as well. Not only that, but you’re also opening up to a new market (as mentioned, non-members) and new partners (grocers, restaurants, nutritionists).
Digitization is key in bringing the digital maturity you need as an organization in pulling off the bid to go digital. While digitizing addresses the people aspect of digital maturity mentioned in the previous paragraph, it also ensures the readiness of your organization in terms of data availability and process agility. Going Digital involves iteratively experimenting, releasing, and improving digital offerings. If your data is still stored in some excel file (or much worst, in a filing cabinet) or your processes are not digitized and are just in some flow chart posted on the wall, how will that be of any help in creating practically any kind of software? Also, it’s not about building one app, realize that it’s a huge failure, and moving on to building another app. Not only is this a time-consuming endeavor, but you also expose yourself to the risk of going broke very quickly. This is that operational backbone that we mentioned earlier, and why it is critical to digitizing first before going digital. After all, some or all of the components from your digitization efforts will come into play once you go digital.
At BlastAsia, we’ve innovated on both fronts. We created QuickReach, a no-code operations digitization platform that brings your entire operations together by seamlessly blending processes, people, and systems in one place. Because QuickReach is a no-code software, it’s a great tool to quickly and easily digitize your organization. Not only that, the flexibility it provides in tweaking business processes makes it possible to support different kinds of digital offerings that you will create as you go digital.
We didn’t stop at digitization. We also innovated in building custom software, through our low-code platform Xamun. With Xamun, you can create a launch-ready mobile and/or web app in as fast as 6 weeks. Currently offered as a service, Xamun perfectly complements QuickReach because it’s what you’ll need when you move to the next phase of going digital.
These two solutions were created to give you the level of speed and agility that you need in digital transformation. Feel free to get in touch with us at firstname.lastname@example.org to know more about how we can be your partner in your digital transformation.