The Importance of Digitalization

The Importance of Digitalization, Currently in the world, we are no longer in an era of change, but in a change of era. This transition, called the fourth industrial revolution, derives from the exponential advances from digitalization in almost every single industry worldwide. Today, every organization finds each other in the need to implement digital development in their structural core of the organization, where every activity of the organization must work or at least plan its projection to elaborate in assistance with digital transformation tools. Digitalization is not anymore only focused on obtaining a greater profitability, obtaining a higher volume of clients or diversify in the marketplace, but to endure throughout time, this is for the reason that in most example cases, if an organization does not implement the digitalization in a transverse manner, it could undergo threats coming from competitors that do implement these. In some cases, it can be too late and expensive to invest in this technological application when the competition has achieved a considerable advantage in the market, as in the most well-known examples from Netflix, revolutionizing the movie rental industry, Airbnb, transforming the hotel industry or Uber, evolving the taxis industry.

It is crucial to mention that the current digital transformation is not derived from technology directly, we are now transitioning to an era of cultural transformation, oriented to a digital way of thinking. The new nature and reality from young generations have the digital tools implicit in their conventional routines, actually, currently, whoever is not in solid contact with the digital channels, becomes a disadvantaged person in the eyes of society. The inability to digitally interact with other people, to acquire information of our own interests or to be part of the digital supply and demand, turns an individual into somebody inexistent in the cybernetical world. The previous statement might be logical, its difficult to notice or coincide with an individual that does not count with at least one Facebook or Whatsapp account, notwithstanding the same is happening with companies, in the next ten years, the company that is not present in the digital environment, will simply stop existing for the industry of the same. 

Corporately speaking, companies must not only plan to satisfy the requirements of their current audience, but also understand that their clients and potential customers have grown up hand in hand with digital innovation, and will not delay their digital behaviours and/or traditions in the future. Previous to the beginning of this fourth digital revolution, people’s behaviour when faced with the frequent questions was to find a way to find a solution, however, today, the behaviour changes to “in which way technology could assist me in solving my inquiries?”. Such change in the structure of rationalization accrues from a cultural change derived from the digital revolution, where users approach digital tools based on their needs, like transportation, nutrition, entertainment, banking services, correspondence, work, academic information, among others.

An aspect closely related to digitalization is the evolution of automation systems. In recent decades, simple tactical jobs have evolved from human capital towards automated processes. Every company has a common purpose, and this is that their income is higher than their outcome. With automation processes, employment in the banking sector like bank tellers, store clerks, factory assembly personnel, among others, have evolved from being staffed by people to being done by automated systems. These activities, which include money management, repetitive activities, and standardized processes have been improved by being much more productive, with a lower margin of human error, longer working hours and interactions with the client at a more efficient, punctual and consulting way; consequently, better benefits for companies in relation to the reduction of costs incurred in salaries. The growth of automation is also exponential, not only tactical and repetitive tasks are being replaced by automatic systems, but also some other more complex tasks, for example, taxis, buses, and trains that work on automatic pilot, assisted by sensors and GPS (as in the case of Uber and Google), drones and robots that are responsible for delivering and shipping, or also Call-Center service with computers programmed for automatic responses. It is estimated that about 50 million jobs will disappear worldwide with the evolution of automated systems, however history supports that between greater research and development, better ideas and inventions emerge that create new industries, businesses and therefore jobs necessary for the successful development. Finally, from a business perspective, we should not wait for industries to change and transform to our surprise, but start implementing these innovations and concepts in our daily activities to be part of the imminent global transformation

Written by:

Camila Arango


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