Request a call
  • Hidden

The scope of evolutions triggered by technology is overwhelming. Modern tech advancements impact businesses, individuals, and the whole way of life. Digitalization of business is a glorious trend that has become the central point of discussion throughout all industry sectors. The impacts of digitalization can turn business operations upside down and offer sensational benefits. 

By not embracing new technologies today, companies risk staying behind the competition. What do the modern breakthroughs bring to organizations, and how do they gain the maximum advantages from their implementation? The article overviews what digitalization is, its challenges and effects, and what practical recommendations are for its adoption.

What is Digitalization of Business?

Digital transformation is a comprehensive occurrence that comprises the changes to business procedures, technologies, and culture that improve performance and customer experience. Digital transformation may encompass digitalization and digitization, which are different concepts, although sometimes used interchangeably. 

Digital transformation is a long-term trend that is slowly but surely gaining momentum like a freight train. This is clearly seen in worldwide IT spending—in 2021 it was $4 259.8 billion. The forecast for years 2022 and 2023 is $4,431.6 billion and $4,673.7 billion.

Digitization, Digitalization, and Digital Transformation: What are the Differences?

You may come across these three concepts in the media rather often. Although there are multiple cases of use, we can still see cases of misuse. Let’s briefly look at the differences between the three pillars of transferring your business online.

Digitalization in Business — Benefits and Ways of Implementation

Digitization basically refers to converting the information contained in physical objects and attributes into a digital representation. For instance, scanning a document and saving it as a picture. Digitization is the primary step that links the physical world to software. 

Digitalization is generally the next phase after digitization since it implies leveraging digitized information and technologies to enhance processes. In the technology era, the digitalization of business is seeing more importance than ever before.

Digital transformation is the highest level of change as it alters the way of business operation. The concept refers to the entire business transformation empowered by digitalization. This process embraces all areas of your business, from internal systems to customer communication.

Digitalization of Business: The Main Challenges

The fulfillment of digital transformation will occur differently for each specific business. Although the process implies certain similarities, there is no universal template to provide winning results for any company. 

Some organizations fall into the trap of adopting standard solutions; others tend to overlook crucial factors. Here are some of the main challenges companies can meet on their way to digital transformation.

Clear View of What the Digital Transformation Will Entail for Your Specific Business

The vagueness of expectations is the initial and primary challenge for all stakeholders as they do not have a vision of what the digitalization of business will imply. For example, a company may fail to properly assess its business needs and opt for creating an e-commerce website while it has a bottleneck in the order management system. In this case, a digital transformation that implies streamlining and automating order management procedures would be more appropriate. Moreover, by merely creating a website, a company could even worsen the situation, as this would increase the number of orders. 

How to overcome this challenge? Development project managers should participate in decision-making, which would help gain valuable insights and identify the technical bottlenecks.

Considering the Size of the Company as a Significant Factor Affecting the Scope of Change Required by the Digitalization of Business

A company’s size determines the number of employees and the business processes involved in the transformation. The process is a bit easier for smaller firms since they have fewer departments and personnel and thereby a smaller scope of change. On the contrary, larger organizations usually need to split the transformation into phases and implement it department by department. It is also crucial to adjust the business processes and expectations throughout the transition.

The Importance of Digitalization in Business: How Can it Drive the Growth of Your Company?

The impact of digitalization on business is hard to overestimate. 

Enhanced Efficiency and Productivity

Digital tools help companies design their systems and processes to enable more intelligent working processes. Cloud solutions, mobile devices, big data, and analytics empower businesses to reach higher levels of productivity and efficiency. Furthermore, some organizations are applying AI and machine learning to automate and scale data-intensive jobs. 

Research confirms that operational efficiency is the key benefit of the digital model for 40% of businesses.

Top Benefits of Applying a Digital Model

Digitalization in Business — Benefits and Ways of Implementation

Improved Resource Management

Businesses operate using multiple types of resources, including capital, labor, inventory, and suppliers. Resources optimization is a vital constituent of continual growth.

The primary technologies that aid in resource management include the following.

Cloud Computing

Technology is utilized to support resource sharing throughout different departments. Furthermore, the cloud helps to minimize expenses since businesses can pay only for the resources they require. Among the many benefits of cloud computing, it is worth mentioning cloud analytics solutions, which can x-ray multiple aspects of business and find areas for improvement based on the big data that modern businesses use. 

Internet of Things (IoT)

This technology helps companies track their resources in real-time, reinforce their visibility into how the resources are being used, and determine areas for improvement.

The enterprise IoT market enjoys impressive growth and promises to achieve almost $525 billion by 2027.

Higher Resiliency and Agility

Again, technology is an answer to the need for more agile and responsive processes, which are indispensable in a rapidly changing environment. 

Technologies such as IoT and blockchain aid in developing exceptionally resilient business ecosystems. Thus, blockchain enables faster and more cost-efficient delivery of products, enhancing products’ traceability, improving coordination between partners, and aiding access to financing.

Improved Consumer Engagements

Meaningful and engaging customer interactions are essential to stand out from the competition and build trustworthy relationships.

Technology, in this sense, delivers the tools designed for a better understanding of customers’ desires. For instance, AI and data analytics can be leveraged to create consumer profiles, which will then allow for providing highly-tailored customer experiences.

Additionally, chatbots promote customer support, and email applications can help create personalized messages and improve deliverability.

Faster Time to Market

To gain a competitive edge, business owners need to offer new products expeditiously. Your ability to deliver new products to market quicker than the competition depends on whether you can sense emerging trends and adapt fast.

Companies seeking to set the corresponding internal processes will benefit from holistic enterprise-wide digital strategies to ensure that all departments are working in conjunction. AI and predictive analysis tools will aid in keeping track of external opportunities and threats.

New Revenue Opportunity

By leveraging technology solutions, organizations can find new markets and increase their client base. For example, businesses can employ big data analytics to identify new customer segments and market opportunities. Data-driven marketing techniques, in turn, aid in developing targeted marketing campaigns. Furthermore, AI-powered assistants provide personalized customer service and can utilize upselling and cross-selling techniques to increase the general purchase value.

Innovation, Creativity, and Collaboration

Technology spurs collaboration, which is key to business success. Amplified creativity and cooperation among employees reinforce the company’s innovation and creativity. Modern employees are adept in new technologies and willing to utilize them in their working places. 

Advancements like IoT and AI provide the tools to uncover vast volumes of data, process it quickly and efficiently, and derive actionable insights. With staff open to such solutions, businesses become well-armed to make wiser decisions and discover new revenue sources. 

Transparency and Visibility

Smart, informed, and timely decisions are impossible without accurate and relevant information.

Transparency helps companies keep up with the newest trends and stay informed of the market situation. Digital technologies and solutions can be leveraged to set a unified, trustworthy source of truth which is accessible by all stakeholders and based on processing and filtering information from a huge amount of other sources. A universal access to the most up-to-date information enhances operational transparency and allows for better decision-making, more effective business processes, and more consistent organizational culture

Digital Presence

A compelling online presence helps companies boost leads, drive conversions, and raise brand awareness. Online presence in the modern world is composed of a properly designed website, activity on social media platforms, and engaging interaction with customers online. All these aspects, however, need to be integrated into the overall marketing strategy. 

Technology helps align all digital activities and optimize their implementation.

Winning Practices for Digitalization of Business

Digitalization in Business — Benefits and Ways of Implementation

If performed correctly, digitization and digital transformation are intended to drive organizations to a more customer-centric approach and elevate performance. Here are several things a business can do to accelerate the advantages of digitalization.

Take a Strategic View

Start your transformation by clearly formulating your end goals. Develop your strategy based on those goals since this approach will deliver valuable results. Your goals can comprise the following:

  • Streamlining processes for internal data sharing
  • Expediting the work of customer service
  • Revealing new client segments
  • Engaging your customers in active communication with your brand

Determine the problem areas to set the goals correctly and then pave your way to digital transformation. 

Consider the Culture

To experience the full impact of digitalization on business, you should view the transition as an opportunity to implement magnificent improvements to your business processes. Digital solutions and other technology resources are only part of your transformation. If not accompanied by deep changes in poor practices, they will never solve your performance and productivity issues. Therefore, you should think of the ways your people work and fulfill their everyday duties—if you manage to revamp those processes, the digitalization of your business will display its full power.

Combine Digital Tools and Talent

Before deploying digital transformation, enable your teams to maximize the effects of digitalization on business. How can you make your staff adept with advanced digital tools? 

  • Engage employees with strong technical skills to supervise your transformation
  • Select the tools that have easy and intuitive designs to simplify the transition for the less tech-savvy personnel

Your ultimate goal here is to create an environment where everyone brings a certain degree of digital awareness and skill. Depending on your existing talent, you may choose to hire some new experts to fill the gaps in digital skills or train current employees to reinforce their tech capabilities. 

Direct Your Efforts

Digitalization of business can potentially alter every part of a company, from product development to supply chains and sales. While the transformation requires a comprehensive approach, it does not mean that you should tackle all areas at once. 

Prioritize your goals by identifying the parts and processes in your organization where digital transformation can deliver maximum benefits. Then, compare that with the parts where you can make the respective changes quickly. By doing this, you will get a vision of where to direct your initiatives and investments first. 

Don’t worry if you start with digitizing only one specific area. Evaluating the effects of digitalization on business based on your first transformation project will help you plan further steps if they are required.

Establish Your Priorities

While this point partly intersects with the previous one, it deals more with establishing the effectiveness criteria to boost the benefits of business digitalization. How should you set priorities for business digitalization? Think of the primary issues your organization is experiencing and weigh every project according to these criteria.

If your overall goal is to digitize knowledge about products, you can base your criteria on the following considerations:

  • Which are the most critical information assets for sales reps? 
  • Does your database contain outdated or irrelevant assets? 
  • What is the value of resources throughout the organization? 
  • Should you prioritize assets that are frequently used by sales and service teams? 

Such questions will help you get a more detailed vision of your goal implementation and carefully consider the criteria that will be used to ensure your transformation moves in the right direction.


The business world is confidently occupying the online space. If you miss the right time to digitize your organization, you will likely lose a competitive edge. 

Digitization, digitalization, and digital transformation are all different processes and embrace different scopes of change. To maximize the benefits of digitalization in your business, you should identify the primary areas that require transformation, assess the needed range of change, and establish ultimate goals and criteria that will deliver your achievements. 

In our practice, we have faced situations where companies set excessively ambitious objectives for their digital transformation or prioritized the wrong directions. Our multifaceted experience in the industry allows us to optimize the digital transformation path for our clients and deliver customized solutions to perform the efficient transition.


Subscribe to our newsletter

This field is required.
This field is required.
This field is required.

Thank you for subscribing to our newsletter


Thank you for subscribing to our newsletter

Configure subscription preferences configure open configure close

This field is required.
This field is required.
This field is required.
This field is required.
This field is required.

Contact Us