In brief
Digitization is the conversion of analog information to digital. Digitalization is the use of digital technology to improve processes. Digital transformation goes further: it is a fundamental change of your entire organization, supported by digital technology. Each step builds upon the previous one.
Definitions of digitization, digitalization, and digital transformation
What is digitization?
Digitization is not an official word in Papiamento; we translated it from the English word 'digitisation'. It simply means converting analog information into ones and zeros, so it can be stored digitally and shared or adapted. In Papiamento, this is often categorized under digitalization, but there is an essential difference between the two terms. Digitization focuses on the level of information and its processing.
What is digitalization?
Digitalization is the use of digital technology to improve processes and services. This includes, for example, automating tasks to work more efficiently and effectively. As mentioned earlier, digitalization is different from digitization because it operates at the process level.
What is digital transformation?
Digital transformation uses digitization and digitalization as its foundation. It consists of both elements but goes further. According to the definition by S. Jansen (2022): Digital transformation is a continuous change of the entire organization, sustained and supported by the increasing use of digital technology. The essence of transformation lies in a change of the business model. The main question is how the organization can continue to provide value to its clients. Transformation impacts every aspect of an organization, including culture, strategy, processes, relationships, and employee capabilities. DEN has developed the Focus Model to provide a better overview of your (digital) activities, where they come from, and what they contribute.
Similarities in the definitions
It is not surprising that these terms are often confused. They overlap in their meanings and usage, particularly in three areas:
Driven by technology: new technological developments offer new opportunities for digitization, digitalization, and digital transformation.
Aimed at optimization: the goal of digital interventions is to increase productivity, efficiency, and effectiveness, sometimes all three.
Foundation for data-driven work: all three digital changes can be used to make strategic choices. The digital transition in storage, processes, or organization ensures better understanding and insight into figures and data, which can be used to make better decisions.
Differences between digitization, digitalization, and digital transformation
Digitization, digitalization, and digital transformation efficiently use digital technology. The differences are visible in their scope, impact, and purpose:
Scope: digitization deals with converting data (from analog to digital). Digitalization professionalizes processes with digital solutions. Digital transformation uses technology for a complete change of the entire organization.
Impact: digitization is often a project or task, digitalization primarily concerns operational processes, and digital transformation is a strategic change affecting all facets of an organization (e.g., structure, business model, etc.).
Purpose: digitization makes information more accessible or locatable, digitalization focuses on more efficient work, and digital transformation uses digital resources to change the entire organization. The goal is to increase agility and keep pace with the changing needs of the client.
Why DEN is committed to digital transformation
The world around us is continuously and rapidly changing. It is hard to imagine daily life without anything digital, and this has a significant impact on organizations. In recent decades, many cultural organizations have invested in digitization and made their collections digitally accessible. However, to continue engaging, moving, and connecting with today's and future audiences, the digital aspect must become a structural part of the strategy and organization.
Digital transformation is the process of integrating this structural change into all facets of the organization. This way, it is no longer just part of a single team or department but provides input across the entire organization. From audience reach and value proposition to new processes and offerings. This increases the agility of the entire organization, allowing it to respond to changing needs and external factors. Digitization and digitalization are valuable components that can support digital transformation.
Sources for this article
S. Jansen (2022). The management book for digital transformation
Frequently asked questions
Are digitization and digitalization the same thing?Hide explanationShow explanation
No. Digitization is converting analog information to digital — think scanning a file. Digitalization uses digital technology to improve processes, such as automating administration. They are often used together, but they describe different levels of change.
Do I need to digitize before I can transform?Hide explanationShow explanation
Not necessarily. Digitization and digitalization can be part of a transformation journey, but they are not a prerequisite. Digital transformation begins with a strategic question: how do I remain relevant to my audience? From that question, you determine which digital steps are prioritized.
What is the difference between digital transformation and a digital strategy?Hide explanationShow explanation
A digital strategy is the plan — the choices you make regarding how you use digital technology. Digital transformation is the process of execution and change that results from it. The strategy provides the direction; the transformation is the journey.
How do I know which phase my organization is in?Hide explanationShow explanation
That depends on how much digital technology is already integrated into your organization. Use the DEN Digital Transformation Scan (opens in new tab) to determine where you stand — and what your next step might be.
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