A transformation where the system components and its communication links move towards digital end of technology from analog end of technology.

What does digital mean…. emphasis is not what the technical or technological meaning of digital is – that is, it refers to something using binary digits like 0 and 1.  Digital in simple terms can be seen as making the objects around us or their usage more manageable than the analog systems.

Digital has made the things around us simpler, easy to use and we can better relate to. The day to day experiences in life with digital devices have been better and their usage ever increasing. For example, if we check the commonly used digital devices like digital watches or digital weighing scales, they are easier to use and more accurate. In sports like a hundred-meter race, the time recorded in digits is more accurate and can be recorded to a level of hundredth of a second whereas with analog equipment it would not have been that easy, if not impossible.

Digital technology has made the life more efficient.  As more and more objects are moving towards digital our experiences are getting better. In a similar fashion, when companies gear towards digital transformation, they would become more efficient – that is the assumption. Hence there has been much focus in the past decade for the digitalization of the organizations and this seems to have picked up much pace recently.

At the same time there are few things to be considered so that digital technology can be optimally used and there is a balance. 

Ecommerce is one of the examples of the society moving towards digitalization. The events that have led to the digital transformation can be attributed to the advancement of electronics, the semiconductor industry and specifically the integrated circuits therein. There has been continuous improvement in integrated circuit design over decades since their advent and this has been a key factor in digital revolution. These integrated circuits form the backbone of almost all the electronic equipment like computers, tablets, mobile phones, digital TV, gaming consoles, digitally controlled devices in vehicles and home appliances. 

There has been many studies conducted by consulting firms around digitalization of the organizations; the benefits it brings, better resource utilization and overall business success. Still digital transformation of the organizations is not happening at the pace at which it should happen or have happened. These are constrained by organizational structure and behavior. These are also driven by the size and complexity of the organizations. For large organizations going through any transformation is not easy as it is going to impact the daily operations of that organization during the transformation project as many resources would be taken out, from their daily operations, to work on the project; at the same time organization has to ensure that operations are not affected. There are other factors to be considered. Small and mid-size organizations have their respective challenges and constraints.

Digital transformation like any transformation brings change in the organization. And, change is not generally imbibed easily by the organization and its people as there is always reluctance to change. There have been multiple studies to validate and look for solutions to make the change management effective and as seamless as possible. Well reluctance to change is a common behavior, as laws of Physics also state and suggest the same; that is, if something is stationary would tend to remain stationary or if something is moving will tend to keep on moving unless there is some external force applied. Similarly, organization by itself will not prefer change unless there is some external force which could be a transformation project that leads to the required change. The causes could be the market competition, to remain competitive, viable and relevant in the current market or at the very basic mere survival of the organization in the current disruptive world or the VUCA world as they say it now a days. 

Change implementation and management becomes very important. 

Manufacturing companies have been quite familiar with automation, sensors and robotics especially where mass production happens. This can vary from industry to industry and also within a particular industry depending upon the size and resource availability and other factors. For example, automotive industry has multiple production lines where many stations are fully automated without any need of manual intervention. In the CPG or FMCG industry the blending/mixing happens at automated stations, followed by packaging again at automated stations. Manual intervention is required when something gets stuck or doesn’t work as required.

Warehouse and transportation companies have been exposed to the electronic data transfer for efficient information exchange so that inventory movements can be better management within a warehouse, from supplier to warehouse, from warehouse to a customer, between warehouses or the movements could be between any business partners.   

Automation and electronic equipment and systems are not new to the industry and so are the process improvement, productivity improvement, better capacity utilization methodologies and disciplines. Six Sigma, Kanban, Just in Time, Lean and recently being the Design Thinking and many more process optimization methodologies have been there for a while then what value does digital transformation bring in?

This does lead us to the new technological disciplines, concepts and systems emanating from digital ecosystem like the Internet of Things, Artificial Intelligence, Block chain, Big Data and much more to come as we keep on inventing. Emphasis has been to use cloud computing by many organizations to embark on the journey of digitalization. 

It has been predicted that digitalization is going to impact each industrial sector like Utilities, Aerospace, Oil and Gas, Renewable Energy, Healthcare, CPG, Automotive, Construction, Global logistics etc. and business area like manufacturing, warehousing, transportation, quality management, finance, human resources, customer service and so on. This would mean that entire supply chain is going to be influenced by digital transformation and we already see this in many industries. The focus at this time seems to be more on the marketing and sales side to reach the customer, know the customer, their buying preferences and history so that customers can be better served and provide them an enhanced and enriched customer experience.  This includes reaching out to customers via digital media, emails, campaigns, search engines and social platforms. A delighted customer would lead to better business prospects.