Digitization is the adoption or increase in use of digital or computer technology by an organization or a company. Today, the focus of digitization is on the consumer interface, and consumer products and service. Companies want to get closer to their customers.
Companies that embrace digitization generate more turnover, are more profitable and have a higher company value. One major advantage enjoyed by such companies is increased efficiency. Production is key for any company targeting growth, and time is great factor when it comes to measuring productivity. Having a centralized portal where cataloged digitized files exist can greatly increase production time and deliver information quickly, a shift from the traditional model where an employee has to spend more time trying to pinpoint the document’s location than actually using the file.
The Internet has revolutionized the commercial landscape and changed the way business is conducted. It has created a business environment in which time and distance are less important, people have access to more information to help them make decisions and consumers have better access to a broader range of products and services.
An example is the idea of e-commerce. E-commerce, also known as e-business, is the conducting of business processes on the Internet. These processes include buying and selling products, supplies and services; servicing customers by providing technical or customer support; and processing payments.
An example of an e-business is an online retailer. An online retailer uses the Internet as a means to advertise and sell physical merchandise of one kind or another. Online retailers allow consumers to order merchandise from the comfort of their location and have the goods shipped to them. Some of the advantages that online retailers have over traditional brick and mortar retail stores are the ability to sell goods at any time of the day, to remain open on holidays and to sell goods without incurring the cost of renting retail space.
Services can also be provided through e-commerce. Users can sell merchandise via online auctions. Airlines are even providing online platforms through which customers can book air tickets without having to do so manually. Restaurants can adopt various online restaurant guides which will allow users to search and book restaurants by cuisine, location and budget right from their mobile phones, plus stay up to date with the latest news, offers and events.
There are advantages enjoyed by businesses which use the e-commerce model and these include:
Lower Startup Costs
Low investment costs are a prime factor for many businesses aiming to maximize profit and growth. A significant advantage of using the e-commerce model is that the initial investment for starting up an e-business is generally lower than the cost associated with starting an equivalent business using a traditional model. While the traditional brick and mortar model needs a physical location for the storage of goods and merchandise to be sold, such as a warehouse or a store, companies using the e-commerce model do not need the same. Businesses using e-commerce do not necessarily need to rent retail space.
For businesses already operating in a physical location, they can still leverage on the advantages of digitization. An example is where a company can get rid of many of its filing cabinets by adopting a computer system that allows for the digitization of the company’s records. Cloud computing solutions provide storage services that are not only secure, but also inexpensive and very reliable. This will free up space that was initially used to store the records and save up on resources.
Easier and Faster Communication
E-business also makes it easier, faster and cheaper for businesses to communicate with their trading partners such as their suppliers, and their customers. Using email and online ordering systems, communication and transactions occur almost instantly. This is particularly useful in the age when the demand for real-time information by consumers is high. Furthermore, the Internet is accessible twenty-four hours a day, seven days a week. This means that buyers and sellers can conduct transactions at any time, as opposed to the regular trading hours of traditional business models.
Access from Anywhere
With developments in cloud computing, users can access information from anywhere. This is particularly useful for businesses that adopt cloud computing solutions in order to leverage on the benefits of e-commerce. Consumers can therefore access information on the business from anywhere as long as they have devices that can access the Internet, without necessarily having to visit the company’s physical locations. This goes a long way in increasing the geographical scope available for the company’s market.
Better Customer Service
The Internet can also make it easier and more cost-effective for business managers to track and analyze the buying patterns of their customers, and in turn tailor the business to better suit their needs and expectations. Eventually, an e-business will operate on reduced costs and pass the savings on to their customers, who save money and time by shopping from their own homes.
E-business when adopted by a company, enhances organizational performance. Furthermore, e-business is a low-cost tool that offers many advantages including greater geographic reach at a time when companies aim for a global audience, greater visibility for the companies’ products, improved relationships with customers and suppliers, and new channels of communication. The ability to react quickly to the preferences and demands of consumers is a plus for any company seeking competitive advantage.