Academics love to quibble over definitions, but the two-letter difference between ‘digitisation’ and ‘digitalisation’ does have profound, real- world, significance.
The currently accepted distinction comes from market researcher Gartner. It says that Digitisation “takes an analogue process and changes it to a digital form without changes to the process itself”.
But Digitalisation “is the use of digital technologies to change a business model and provide new revenue and value-producing opportunities”.
When you buy a new truck, it comes with a manual for fault diagnosis and rectification. This manual contains a lot of ‘digitisation’. The text has been word-processed, images were scanned, and diagrams generated in CAD. Printed copies, are generated directly from a digital file, while other digital processes can make it available online.
This has taken cost and time out of producing the manual, and made it easy to change, update and disseminate. But the process that the manual empowers – that of finding faults and mending them, is still analogue. It involves looking, reading, thinking, and then putting the results into other analogue or digital systems to order parts or book a repair. – The information is digitised, but the process isn’t.
Digitalisation of the process
On the other hand, a file containing the same knowledge could be used directly, by the truck or other machines and systems. Allowing them to take readings, diagnose the problem and take appropriate action. This might include adjusting the operating parameters, ordering a spare part, booking maintenance, claiming on the warranty, or analysing root cause of failure. All performed quickly, seamlessly and automatically.
Consequently, the way that part of a business is run may be profoundly changed. For example how maintenance is planned, what resources are allocated, the safety buffers, the inventory held, and the way a vendor provides support.
This is digitalisation and moves beyond making your own processes more efficient. It allows a company to offer customers radically new ways of working.
A Digitalised approach to Intelligent Freight Matching
In TGMatrix’ own speciality, that of Intelligent Freight Matching, this is also true. Our digitalised approach doesn’t just offer customers a faster, more accurate and more efficient way of meeting transport needs. By working automatically with other systems, it enables a tactical rethink around how firms plan for transport and what sort of delivery promise they can give customers. It also considers how they approach Cost of Service, how they take ownership of events as opposed to merely reacting to them, and what sorts of relationship they can support.
Digitalisation doesn’t just enable ‘thinking outside the box’ – it can help create entirely new boxes to play in!
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