Digitalisation is defined as transforming people, processes and technology to become a digital organisation. This encompasses realising a digital workplace, creating a digital value chain, using digital technologies and digital data, improving business (not just processes) and creating a digital culture where digital information is at the core of every service made available to the public.
Digital transformation requires the organisation to deal better with change overall, essentially turning change into a core competency as the organisation becomes end-to-end people-driven. According to Rob Llewellyn, founder of CXO Transform, “Transformation is about creating a new future, without the constraints of the past. … The difference with change is that change improves the past, while transformation creates the future.”
Becoming a digital organisation is, by default, a transformation of the current operating model to a future version based on a high confidence in digital capabilities. Organisations will have to strategise the future target operating model, and this will undoubtedly result in introducing new capabilities to the organisation. This will require new people, processes and technologies to be used to improve the services.
This is different from digitisation, which is simply the automation or digitisation of business processes, which in turn is based on the digitisation of paper (removing paper-based processes). This also includes the removal of manual labour where it isn’t effective or efficient.
Putting this together, we can state that we digitise information, we digitalise processes and roles that make up the operating model of an organisation, and we digitally transform the business and its strategy. Digitisation and digitalisation are essentially about technology, but digital transformation is not. Digital transformation is about the person.
It is fundamental that an organisation strategises “what” to transform, not “how” — that will come later. A digital mind-set considers new ways to transform business models, how they can deliver better value and experiences to people, operations and the workforce. The mind-set calls for completely new ways of operating within the organisation and with its workforce, partners and external talent.