Many companies are now working on digital transformation (DX). As digital technology evolves, innovative products and services continue to emerge, enriching our lives. Turning to the business scene, with the development of AI (artificial intelligence) and IoT (Internet of Things), new businesses are emerging that completely overturn conventional wisdom and frameworks.
The First Industrial Revolution/Second Industrial Revolution that occurred in human history was a fact that could only be known in textbooks. But now we are facing the new industrial revolution of digital transformation.
In this article, what is Digital Transformation, whether you are a business person or not. The purpose is to help you to know the information and prepare to stay abreast of the times.
What is Digital Transformation?
The term was first advocated in 2004. Eric Stoltermann, a professor at Umeå University in Sweden, shares the concept that "continuing evolving technology enriches people's lives." In other words, I thought that "transformation" using digital technology would take place everywhere.
This concept is now a reality. Over the last few years, digital technologies such as AI and IoT have grown exponentially, increasing convenience and efficiency in business as well as in personal life. If you talk to your smartphone, you will get the answer you want immediately, and there are even wearable devices that keep on recording biometric data just by wearing it.
In the business scene, new businesses are being created one after another through a huge network that connects consumers, and we often see scenes such as small and medium-sized enterprises capturing the market share of large enterprises through marketing activities that utilize digital content. It is possible. In addition, unexpected disruptive products and services may suddenly appear in the market, and that company may become a unicorn company.
(Distractive: also known as disruptive technology, disruptive innovation, disruptive change)
By the way, digital transformation means "digital conversion" when it is translated directly, but it is proper to translate "transformation" instead of conversion, and it is pervasive. In addition, digital transformation is not just a change, it means "disruptive change using digital technology." This is called “digital disruption” and means innovative innovation that undermines the values, common sense, and social framework we have built up to date.
Digital transformation for business
The explanations so far have only been about digital transformation as words. In fact, it's a bit different from digital transformation in business. Furthermore, the definition may differ depending on the country or industry, so it cannot be said that "this is generally the case!"
So what does digital transformation mean for businesses in Japanese society? The answer is presented by METI.
“Companies respond to drastic changes in the business environment, utilize data and digital technologies to transform products, services, and business models based on the needs of customers and society. Transforming culture and culture to establish competitive advantage."
This definition is stipulated in the “Guidelines for Promoting Digital Transformation (DX Promotion Guidelines)” announced by the Ministry of Economy, Trade and Industry in December 2018.
In short, "a digital transformation that a company should tackle" is a concrete definition of a digital transformation that is concretely applied to a business.
Digital transformation has no “must have”. However, past examples and changes in digital technology have revealed the elements that make up digital transformation. The four are "cloud computing (cloud)", "mobile network", "big data analytics", and "AI/IoT".
1. Cloud computing
The system environment that was previously built in-house is now built on the Internet. Supporting cloud computing technology, it is attracting attention as a platform not only for digitizing infrastructure but also for storing huge data and providing new services.
It is inextricably linked to digital transformation, and many digital transformations are made possible by cloud computing.
2. Mobile network
The era of "one PC for one person" has passed, and "one smartphone for one person" has become commonplace. The networks that mobiles make up are too huge/powerful, which can be a huge boon to your business.
In addition to dramatically improving the labor productivity of organizations, new products and services using mobile networks are also appearing one after another, and they are arguably the core of digital transformation.
3. Big data analytics
It's been a long time since the word big data was born, and it's rarely seen in the media. However, it is because big data did not just flow as a buzzword, but the data in modern business is extremely large and diverse, and data has come to refer to big data.
Therefore, technologies and methodologies for analyzing big data are still hot topics, and there are many examples of realizing digital transformation based on big data analysis.
4. AI / IoT
The hottest trends in the IT industry are AI and IoT. The two digital technologies have a mutually complementary relationship, and AI analyzes and feeds back the data collected by the IoT to improve the convenience of the IoT. Furthermore, the accuracy of AI will be further enhanced by continuously analyzing the data collected from the IoT. AI/IoT will continue to be at the center of digital transformation.
What do you think? Knowing digital transformation can enrich your personal life, drive your business, and create new transformations. Take this opportunity to gain a better understanding of digital transformation.