Hello everyone, My name is Kenshin Fujiwara and I am the CEO and founder of HACARUS Inc.
Through this series of blogs, I will discuss a wide range of topics of AI, from the history of AI to practical tips for successful application of AI projects. I hope my blog posts will help you gain a better understanding of AI and solve your business issues.
Today I would like to discuss the difference between Digital Transformation (DX) and digitization/IT. In recent years, an increasing number of companies have established internal organizations or positions such as a “DX Promotion Office” or a “DX Manager”. As was the case a decade ago when many companies were pushing forward with IT and digitalization, the promotion of DX has become a major theme for companies aiming for growth in the coming years.
Common Misunderstandings about DX
To begin, it is important to note that DX should not be confused with IT or the digitalization of business operations. It is common for people to misunderstand this point when talking about this subject. For example, when discussing DX, many companies throw around metrics like, “digitizing all internal approvals and eliminating the use of stamps for approval (hanko)”, “digitizing customer presentation materials and providing iPads to sales representatives”, or “introducing robotic process automation (RPA) to improve productivity in the workplace.” While useful, these are all examples of IT and the digitalization of operations and they cannot be called DX.
The true focus of DX is not the digital aspect, but rather the transformation or change. Often, you will see phrases like “we will digitally transform our company” or “We will implement DX”, but the true meaning of this concept is often misunderstood. While it is not the main focus, the digital aspect of DX is still extremely important. If it wasn’t, it would make more sense to stick with analog operation and start a new business or modify your current business model.
Digitalization as Minimum Requirement
Before proceeding, it is also worth noting that it isn’t a requirement for a company to go through DX. If it is sustainable without digitalization, then it is perfectly acceptable for it to continue its expansion using analog means.
However, with the current trends in digitalization and networking in general, it is highly recommended that companies consider DX. Today, the business climate is evolving at a rapid pace, and companies risk falling behind if they ignore DX entirely.
A quick example is when a customer asks a company to send a quotation by email. In this case, if the company sends a paper quotation through the post, it would be unable to meet its customer’s demands. At the same time, rival companies would adopt email quotations and steal the customer from you.
While this is a simple example, in this day and age, digitization of operations has become the minimum requirement for companies who are looking to transform their operations. In such a world, companies will be unable to continue their business if they do not arm themselves digitally and they will quickly be left behind. This is why DX includes both aspects of “digital” and “transformation”. I believe that digitalization is indispensable for change in the coming era.
In the next blog, I will explore how to successfully and effectively manage AI projects, in particular, we will study about the 5 steps for proceeding with an AI project. For your updated knowledge and insight about AI technology, subscribe to our newsletter or visit HACARUS website https://hacarus.com.