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Digitalization definition

Digitalization is using digital technology to modify current or create new business processes, culture, and customer experiences. It is meant to meet changing business and market requirements. The terms digitization and digitalization are often used interchangeably, however, they mean different things in IT context. Digitalization harnesses the capabilities made possible by digitization to enable, improve, or transform business operations and our daily lives.

See also: digital data, analog computer

History of digitization

Digitization started in the late 20th century as a product of the digital revolution. As computers and the internet became widely available, businesses saw the potential of using these technologies. And they did — slowly, but surely, businesses started to streamline their processes, improve customer interactions, and open new avenues.

Today, digitalization is often a necessity for businesses across the globe. It has led to the rise of digital-first business models and is a key factor in societal changes and advancements. Netflix is often considered to be the prime example of successful digitalization. It transformed the video entertainment industry by replacing traditional video rental services with online streaming.

Likewise, entire industries have been transformed by digitalization. For example, music moving from vinyl to CD’s to streaming services. Or banking transitioning from physical offices to online platforms.