Before identifying the benefits of digitization, it is necessary to define it, as digitization is applied to a variety of processes. An article in Forbes emphasizes the importance of distinguishing between three of the most common buzzwords in this context.

According to Gartner, digitization is “the process of converting from analog to digital form.” In concrete terms, it is any process that returns information that a computer can read. There are several examples of this in the business context, ranging from payroll management to sales performance monitoring and data analysis, all of which have undergone significant digitization.

On the other hand, the terms digitization and digitalization are frequently used interchangeably. According to the article, it is “the way in which many domains of social life are restructured around digital communication and media infrastructures.” Whatever definition is considered most appropriate, the fundamental point is its ability to bring about significant changes that benefit both businesses and individual users.

Finally, digital transformation encompasses a broader definition of digitization because it is a change dimension that affects all business functions and has a strong customer orientation. In concrete terms, a series of digitization projects can lead to a company’s digital transformation. According to Gartner, it can “refer to anything from IT modernization (for example, cloud computing), to digital optimization, to the development of new digital business models.”

Digitalization of business processes

This, like any major change in business dynamics, takes time, both in terms of implementation and results (or profitability), as well as a commitment in terms of resources to be invested in the process.

Efforts to fully digitize processes, on the other hand, are largely repaid in terms of revenue and transaction costs.

When we look closely at the many positive aspects of digital transformation of business processes, we can identify five points that summarize the main benefits of taking one’s business into the digital dimension.

Capability to enter new markets

Finding new markets for the goods and services produced by SMEs and large corporations can be the most important driver of growth.

When it comes to growing your business, communication is essential. The use of technology to track interactions with prospects in a new market, as well as the ability to monitor in real-time to fine-tune your messaging or the product itself, is critical for ensuring ROI. Furthermore, the ability to connect with your target audience—whether it’s an end customer or a C-level partner prospect—requires a consistent web presence and an omnichannel perspective.

The digital world has made it possible to break down cultural and organizational communication barriers that were previously unthinkable to overcome.

Using digital transformation of business processes to enter new markets entails not only entering new geographical areas, but also entering new opportunities for new products and segments. In the first case, approximately 99 percent of new products do not even recoup their development costs once they are marketed. These aspects can sometimes be used as a basis for the company’s reactive action in relation to the market (number of product features, future trends, high competition).

A proactive marketing strategy must be supported by the appropriate digital tools. In this regard, digital allows for a variety of organizational methodologies. One in particular employs many of the tools now used by small teams or integrated into the processes of large multinational corporations: Design Thinking. Companies can provide greater versatility to teams while also improving how they interact with end-users using tools such as “Sprint” and “Creative Problem Solving.” The feedback gained from this interaction can then be incorporated to improve work processes.

Increased productivity as a result of process automation

Business Process Automation (BPA) entails using technology to automate internal processes such as:

those that must be error-free and repeatable over time
The goal of BPA is to reduce manual effort in repetitive processes, making them less prone to human error and freeing up resources for higher-level tasks that require more creativity and other capabilities that a machine cannot replicate.

There are several examples of this: CV pre-selection processes in human resources, automatic invoice payment processes, and contract management are just a few examples of phases in which a large portion of the related tasks (from filling out forms to sending documents) can be digitized and automated.

Better employee experience

Work structures evolve over time, depending on the type of products and services produced, as well as the need to reach different markets, with flexibility and the ability to organize resources remotely, with teams working from various locations. The first condition for the development of a true digital transformation of business processes and the organization is the digitization of the resources required to develop and plan the distribution or delivery of a service.

The following are some examples of how the concept of Employee Experience (EE) can be improved:

Corporate VPN: access to corporate platforms from anywhere, in a secure and verified manner, is the first requirement for a concrete and widespread digitization development.
Internal training is one of the first forms of retention, as employees increasingly value the ability to learn new skills. Having an online corporate academy also allows you to train employees no matter where they are.
Remote support services: Similar to company academies, the ability to receive immediate remote support for internal processes can significantly improve efficiency and resilience.
While only 8% of the Italian workforce had access to smart working hours according to ISTAT, the COVID-19 emergency situation has given a significant boost to the adoption of new infrastructure.

Constant enhancement of business processes and customer relationships

The sum of the preceding points leads to the company’s viability through a reduction in fixed costs and an increase in capacity to offer products and services. However, these enhancements must be integrated into a broader framework of how all business processes are organized, from production to performance monitoring.

The customer journey mapping process, which involves tracking the entire consumer experience from first contact with the brand to purchase, varies greatly by industry, but there are some constant elements:

Individual touchpoints in the experience identification: what are the occasions when the company comes into direct contact with current or potential customers? Identify the critical issues and key elements of each individual touchpoint, from physical advertising (from billboards to pop-up shops) to digital customer care.
Multichannel and omnichannel dimensions: the ability to provide a single point of contact across multiple channels (for example, customer care via a territory network linked to an online customer care platform) throughout the buyer’s journey.
Many of the processes that can derail the purchase journey, such as negative customer feedback, can be triggered by calls to external call centers or requests for assistance from physical locations or touchpoints. Conversion can be hampered by complex payment processes or a non-linear journey to the corporate website.

However, thanks to digitization processes, it is now possible to reduce the need for support by resolving the most common issues with chatbots, effective FAQs, or guided journeys (e.g. through the use of tooltips).

The numerous changes in customer interaction caused by digitization necessitate changes in business processes. According to Barr Seitz of McKinsey, “culture is the most difficult aspect of the organization to change.” Shifting technology, finding the right talent, and developing the right product set and strategy are all doable, if not easy. The cultural transformation in businesses with deep legacy and cultural roots is the most difficult.”

Digitization at the corporate level thus encompasses a broad range of technological, cultural, and organizational changes that result in increased internal efficiency and greater responsiveness to external stimuli. As a result, it is more than just the provision of tools and technologies; it translates into a profound change in the way companies do, see, and think, necessitating new approaches to the market and the customer, new organizational and managerial structures in the production chain or in the provision of a service, and new approaches to employee management.