What digitalisation means
Updated: Mar 9, 2021
Guest writer: Elin Hauge, AI evangelist and strategist
‘Digitalisation’. Many business leaders, and others too, are confused about this nebulous term, and struggle to grasp the actual implications and opportunities it represents for their organisations. Technology companies tend to talk a lot about products and solutions, suffocating their customers with more and more consulting jargon. However, in this era of AI and new technologies, digitalisation is not about technology: it’s a mindset, a way of thinking about your customers and your core business. We are surrounded by computers, smartphones and other smart devices, digital assistants, intelligent cars, etc, which have become essential parts of our everyday lives. The point is, we are immersed in technologies that generate, receive, store and process data. Technologies and data that fundamentally change how we all live our lives, what we expect from society, how we interact with businesses and how we solve the large and small problems we encounter every day. As business leaders, you have to adjust to this new way of defining and being part of society. THIS is what digitalisation is all about.
Many products based on new digital technologies are available today, and they have already had a significant short-term impact. The key, however, is to adopt the new technologies in the right sequence, with each one building on the one before, to ensure that your business does not fall behind in the inexorable march of progress. This coherent, step-by-step approach results in a road map suitable for any organisation’s strategy, including its digital component.
These products will, in turn, be dramatically impacted by AI technology, which will shape the digital future for businesses, employees and society as a whole. Based on this insight, we have divided digitalisation into two distinct waves:
What digitalisation is and how it impacts employees and businesses.
How AI combines with the first wave of technologies, increasing their impact on businesses, employees and society.
Digital Business Strategy
This strategy road map visualises the four sequential technologies from the first wave and the impact AI will have on them, which constitutes the second wave.
First digitalisation wave
Employee and business impact
Step 1. Low Code
A new Low code technology simplifying Application Integrations (APIs) makes step 1 within reach of every organisation. The Chills backend is build on this low code technology and updates customer details frequently in every application. It reduces errors and eliminates the need to constantly re-enter data. Integration costs are now substantially lower, delivering a huge increase in organisational data flow.
The automatic transfer of data between applications, eliminating the need to update customer information manually.
There will be more trust and understanding between departments because everyone uses a central customer database. Repetitive task will be replaced by more creative tasks and interaction with colleagues & customers. This leads to a more motivated workforce, willing to do their best for the company.
Step 2. Adaptive/low-code software
This technology enables organisations with little or no programming knowledge to adapt applications to their unique business processes. Applications can change every day and tasks performed by employees can be automated. Regular communication with application users is required, since the rate of application change will increase. This will motivate employees to share ideas about application improvements, contributing significantly to overall business performance.
Immediate application changes made by customers without programming skills at a very low cost.
Continuously changing tasks. Much closer cooperation between management and employees with regard to application improvements. Employees take ownership of the application and optimise their day-to-day work. This leads to available time being invested in continuous self-development, learning new skills, for example how to interact with AI.
Step 3. Big data –> Big information
The ability to specify and adjust the registration of valuable data, due to the use of adaptive technology, creates an agile business. Data from step 2 is visualised in dashboards and reports. Graphs combining data from various databases, show, for example, relations between logistics and customer satisfaction data.
Data from the entire supply chain is converted into information that provides valuable insights for employees and management. These insights support decision-making at every level in the organisation.
More self-governance (independence), understanding how day-to-day tasks impact the business as a whole, and increased interaction with other departments. Employees are able to discuss the broader impact of decision-making amongst themselves. This also leads to a more agile and integrated supply chain, capable of responding faster to changing customer demands.
4. 3D printing / design automation / digital production
Digital production means an online production chain that delivers tailor-made products to customers. Correctly analysed, information regarding customer trends and behaviour that was obtained in step 3 leads to new products and services.
Product/service creation and adjustment as a daily routine, including tailored delivery to each individual customer.
High demands on employee flexibility due to the increasing rate of change on products and services delivered through a changing organisation. The emergence of a digital process organisation is a result of digitalisation. Employees will shift from mass-producing products to enabling the production of bespoke products, each uniquely tailored to the individual customer’s needs.
Second digitalisation wave
Artificial Intelligence (AI) impacting other technologies
The application of AI to the previously described technologies creates insights surpassing the human intellect, due to AI’s unprecedented data processing power.
Step 1. Low code backend
AI-enabled integration between different applications databases (API). When available, this could increase the speed of digitalisation tremendously. An important consideration for the future is the data set quality fed into AI.
Step 2. Adaptive/low-coding software
AI connected to adaptive applications proposes automation based on the repetitive tasks in the application. The next question is when such application adjustments can be executed autonomous by the AI.
Step 3. Big Data / Information
AI connected to integrated data identifies trends and correlations much faster and better than humans. This AI support will accelerate your organisation’s capacity to deliver new products and services.
Step 4. 3D printing
AI connected to the production chain can create new products and designs based on changing customer trends and behaviour. The right input data is again crucial to enable AI to deliver superior value.
This will provide a practical tool that will enable customers to plot their business processes and applications, and visualise their digital organisations. To create understanding and thereby give customers the confidence they need to make important decisions about their future.
Getting started with digitalisation
From a buyer-supplier relationship to a partnership
In today’s rapidly changing technological environment, spending half a year on digitalisation strategies is a waste of time. In fact, it fundamentally misunderstands the role of technologies. Digitalisation is not a strategy. Digitalisation is about aligning the way you run your business with how the market and society works, and with the behaviour of your users and customers. Your most important task is to pay meticulous attention to your customers and users, and your business strategy is the only strategy that matters.
This is also why technology investments should move away from the traditional allocation of roles, with the buyer on one side of the table and the supplier on the other, to a partner-oriented approach. Technology development is so fast-paced that if you lose sight of your core business for even a short while, competitors may already be moving up the playing field.
There is a growing trend in the market towards ‘as a service’ solutions, simply because companies tend to shy away from investing in fast-moving technologies and prefer to buy the results of these technologies rather than the technologies themselves. But if you are not supposed to spend half a year developing a digitalisation strategy, what then? Just start. Start with small steps, learning as you go.
Digital maturity is not about having the most mature, modern IT system, it’s about having the most digitally mature leadership and organisation.
Guest writer: Elin Hauge, AI evangelist and strategist
Writer: Fredrik De Vries CEO Dynamic Integrations, Software-AI development