The terms digital and digitize are related, one the noun and the other a verb. This creates confusion as they are often used interchangeably for example do you have a digital business or one that is digitized?
Normally I dislike definitional posts that seek to refine terminology more often in an attempt to ‘brand’ a term than create shared understanding. That is not my motivation in the following post, rather it seeks to point out that the use of proper English can have limitations and bias the way we think about new things. In this case it revolves around how we thing about digital technology and the process of creating digital value.
I have an ulterior motive for taking this distinction. On October 23rd, Gartner will publish its first eBook – The Digital Edge authored by Andy Rowsell-Jones and myself. The book uses the term digitalization in an attempt to capture a broader meaning of the work required to create a viable digital business.
Digital – from fingers to figures to facts
The term digital originally referred to anything done with a finger – the digits of your hand. Digital now refers to information. I imagine it made that transition as the first information created involved counting with your fingers. Digital also refers to media in which information is recorded – such as digital music.
Digitize – the process of information creation moving from analog to digital
Digitize is the verb form of digital or the process by which you convert things into a digital form. According to Merriam-Webster, the term digitize was first used in 1953. Digitizing creates digital resources. It is a process of transforming or creating information either about physical objects – like the description of an automobile, its location, its status, etc.
Digitizing refers to creating information from information. For example, when analytics produces new information you can say it is further digitizing the information from information – digital on digital.
Executives create a digital business by digitizing their resources and operations.
The sentence above, while proper English, creates a bias and narrows the context of what it means to become a digital business as if it is all that is required to become a digital business is to replace atoms for bits.
It also biases the context of this process toward its technical aspects – the technology, rather than the business, product, process and value innovations involve in creating a viable digital business and revenue.
Digitize focuses narrowly on the transformation of information. That is where the term digitalization or digitalizing comes into play. As a way of capturing the scope of transformation that goes beyond simply substituting analog or physical resources for their digital or information counterparts.
Digitalization – a mongrel term that captures more of the essence of digital transformation.
Digitalization, if you winched reading that out loud I understand, seeks to recognize that there is more to being digital than swapping atoms for bits. Digitalization attempts to turn the noun ‘digital’ into a verb.
Digitalization is not a word in the English language. The proper word is digitize, but there is more to creating a digital business than replacing atoms with bytes. That process creates digital copies of their physical originals – books become eBooks, forms become portals, processes become online dialogues.
Digitizing only mimics your existing business by following a strategy of digital substitution. You need more to be a digital business.
That more is what the mongrel verb ‘digitalization’ is intended to capture. Yes it digitizes resources, but it also entails the following activities:
- Evolving the business model,
- Using technology to changing the relationship between customer value and company revenue,
- Updating pricing models and policies,
- Creating new digital platforms, among others
All of these things are required to answer the question “How will technology support growth?”
The answer to that question is digitalization – yes its not a word, but it tries to capture the essence of the scale of changes requires to realize a digital strategy.
What do you think of when someone says we digitized the business? Is your focus on the digital things they have created or the transformation of the organization?