1. What is digital transformation and digitization?
Digitization is the process of converting data and information from traditional forms (such as papers, images, documents) into digital form. Digitization makes documents easier to store, access and process using computers, facilitating the use of technology and digital data in the digital transformation process. Digitization can be applied to many types of information, including text, images, audio, video, sensor data, etc.
Digitization example: convert paper documents into PDF files, convert analog images into digital photos,...
Digital Transformation is the process of using digital technologies to change the way an organization, business, or an area of social life operates. Digital transformation is not simply the application of new technologies, but also a change in thinking, models, processes, and culture of organizations and businesses.
Digital transdormation in businesses not only increases labor productivity by automating manual work, but also helps businesses operate more efficiently and enhance competitiveness. In addition, digital transformation also creates a favorable environment for innovation, helping organizations and businesses develop new products and services to meet market needs.
Example of digital transformation: Moving from a traditional business model to a network and data business model, such as converting a brick-and-mortar store to an online store.
2. Distinguish between digital transformation and digitization
Same: Digital transformation and digitization are both the process of applying digital technology to business operations. Both aim to improve operational efficiency, growth and sustainable development of businesses.
Difference: Digital transformation and digitization are often confused with each other. However, these two concepts have fundamental differences:
| Digital conversion |
Digitizing |
|
| Concept | The process of applying digital technology to all aspects of business operations |
The process of converting data and information from analog to digital form |
| Target | Innovate, improve business efficiency, create new values | Store, process, and analyze data more effectively |
| Limit | Comprehensive, including technology, processes, and people | Limited to data and information |
| Human factors | The human factor has not been given due importance in implementing digitalization | The human factor is the key factor that helps build and implement a successful CDS roadmap |
| Time | It is a complex process, requiring a minimum of 3 to 5 years to complete. | Several months to a year, depending on information traffic, technology infrastructure and human resources capacity |
|
Hard |
- Costs can be huge, including investment costs in technology, human resource training costs, process change costs,... - It takes a lot of time and effort to train and develop human resources to meet the requirements of digital transformation - Facing mixed reactions when changing the culture and way of working of the business. |
- Digitizing all data can encounter some difficulties, such as heterogeneous data, scattered data,... - Technological difficulties
|
|
Benefit |
- Increase operational efficiency by automating processes, improving decision making and optimizing resources - Increase competitiveness: Digital transformation helps businesses capture new market opportunities and meet customer needs quickly and effectively - Save operating costs, increase profits and revenue |
- Enhance the ability to access and manage information effectively - Collect and analyze data accurately and effectively, helping businesses make wise business decisions - Digitalization helps businesses create new products and services, better meeting customer needs |
|
Practical examples |
Use CRM to manage customers, use ERP to manage production, use AI to automate processes |
Scan paper documents into PDF files, convert analog images to digital photos,... |
3. The relationship between digital transformation and digitalization: Digitalization to advance digital transformation
Digitization is the process of converting data and information from analog to digital form. This is the first step in the digital transformation process. Digitalization helps businesses store and manage data effectively, creating the foundation for other digital transformation activities.
Digital transformation is the process of applying digital technology to all activities of organizations and businesses to improve efficiency and create new value. Digital transformation includes digitization, but it doesn't stop there. Digital transformation requires businesses to change the way they operate, think and culture.
Therefore, "Digitalization to advance digital transformation" means that businesses need to digitize their data and information before they can perform digital transformation. Digitalization helps businesses prepare the data and technology foundation necessary for the digital transformation process.
| Digital conversion |
Digitizing |
|
| Concept | The process of applying digital technology to all aspects of business operations |
The process of converting data and information from analog to digital form |
| Target | Innovate, improve business efficiency, create new values | Store, process, and analyze data more effectively |
| Limit | Comprehensive, including technology, processes, and people | Limited to data and information |
| Human factors | The human factor has not been given due importance in implementing digitalization | The human factor is the key factor that helps build and implement a successful CDS roadmap |
| Time | It is a complex process, requiring a minimum of 3 to 5 years to complete. | Several months to a year, depending on information traffic, technology infrastructure and human resources capacity |
|
Hard |
- Costs can be huge, including investment costs in technology, human resource training costs, process change costs,... - It takes a lot of time and effort to train and develop human resources to meet the requirements of digital transformation - Facing mixed reactions when changing the culture and way of working of the business. |
- Digitizing all data can encounter some difficulties, such as heterogeneous data, scattered data,... - Technological difficulties
|
|
Benefit |
- Increase operational efficiency by automating processes, improving decision making and optimizing resources - Increase competitiveness: Digital transformation helps businesses capture new market opportunities and meet customer needs quickly and effectively - Save operating costs, increase profits and revenue |
- Enhance the ability to access and manage information effectively - Collect and analyze data accurately and effectively, helping businesses make wise business decisions - Digitalization helps businesses create new products and services, better meeting customer needs |
|
Practical examples |
Use CRM to manage customers, use ERP to manage production, use AI to automate processes |
Scan paper documents into PDF files, convert analog images to digital photos,... |
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