Are you digitising or digitalising?
Scratching your head? Let’s unpack in The Digital Week
The distinction between these terms is the theme of the most recent episode of The Digital Week.
Head of the PwC Chair in Digital Economy, Marek Kowalkiewicz, starts us off by defining the two.
Digitsation — “Is all about technology, it is all about applying new technologies on the existing business models… to make it operate better.”
Digitalisation — “Is all about completely new ways of thinking. What is the new value that can be created that was not possible before?”
As QUT’s Professor Michael Rosemann points out, digitisation is nothing new. We are essentially talking about automation — mass pain relief.
“It is not just implementing a massive piece of software and replacing paper… We do robotic workflow, we do Machine Learning, we use voice to talk to the government. We see an entirely new level of sophistication.”
Michael says Amazon Prime is a typical example of digitisation. They “deployed the latest technology — predictive shopping, predictive forecasting. Utilising the latest digital technology but ultimately optimised within the same business model.”
Essentially, Amazone Prime are selling the same products, they just made it more time and cost effective.
Marek explains, digitalisation is more “creation rather than automation”.
“If the only thing we do is put robots in the exact same place we had humans, this is not yet creation… This is not yet creation of a whole new value”.
Marek encourages us to look at Netflix as a key example. Initally, Netflix was a streaming service, recently transforming to media production. Those who digitalise are “never stuck to a particular industry”, explains Marek.
Should you be digitising or digitalising?
Well, both. “A truly digital business is both, digitised and digitalised” according to Marek. Michael reiterates “both are needed, both are equally as important.”
Bring some clarity to your next strategy meeting, listen to The Digital Week.
The Digital Week podcast is produced by the PwC Chair in Digital Econonmy at QUT. The conversation is facilitated by Monica Bradley and aims to make sense of the Digital Economy in 15 minutes.
