Digitization
Syifa Aurellia Maryanto, 2301932701
Digitization
Digitalization has been identified as the most significant technology trend that is transforming society and business. Today, companies are constantly under pressure to use digital technology and adapt their business model to this new reality. However, although switching to digital poses many benefits, it also requires investment and associated costs. Digitalization is one of the most significant transformations underway in contemporary society and encompasses many elements of business and everyday life. Digitalization refers to the transformation from “analog” to “digital” (e.g. the shift from cash to electronic payments) and to the facilitation of new forms of value creation (e.g. Accessibility, availability, and transparency). Digitization adds new capabilities to non-digital artefacts by making them programmable, addressable, reasonable, communicate cable, memorable, traceable, and relatable.
Whereas Innovation is a “new combination of factors of production”, we refer to digital innovation as a new combination of factors of production that introduces discontinuity to a product, technology, organizing principle, market, or set of behaviours and is made possible by digital technology. This definition emphasizes discontinuity, noting that only never-before-tried combinations can be classified as innovations. The necessary but not sufficient condition for such innovation is digitization, i.e. encoding analogue information into digital format.
The concept of digitalization today is growing rapidly. Various fields both the world of entertainment, the world of education, buying and selling, and other fields refer to this concept. Digitalization provides a new experience that was never imagined by us. We get a lot of ease, speed, and accuracy in doing tasks and daily activities. One of the main factors of the shift in offline activity to online is the limited wiggle room during pandemics. This is certainly very felt for students and workers who have to move online at home, both for work and to follow learning. People and businesses that had not fully utilized digital technology, now seem to be “forced” to immediately live with digital technology itself.
A real example that has been so inherent in Indonesian community life is digital payment. Almost all citizens have an e-wallet account that can make cashless transactions in seconds. The use of digital payments is predicted to experience a 5%-10% increase from the period before COVID-19 until the new era after. Some other examples such as the use of e-learning, video conference, e-health, and online fitness were recorded to increase by 50%-90% in terms of user growth. While apps such as an online pickup in restaurants, TikTok, grocery delivery, and online streaming also experienced growth of up to 44%.
Dr Leonardus explained how digitalization can help Indonesia in overcoming the problem of unemployment, inversely proportional to the widespread assumption that digitalization shifts the need for human resources. The transition from offline to online activities is causing a growing need for digital workers. For example, such as how people now increasingly need the existence of e-commerce and social media during activities at home. This is an opportunity for job seekers to actively do business or work in cyberspace. Meanwhile, digitalization will also help the recruitment process that initially seemed long-winded and less effective. The keyword is in the ability to connect recruiters with the right job seekers. That way, job seekers with the appropriate competencies are able to connect and more easily find the position that best suits their abilities.
Based on data published by McKinsey, Indonesia’s productivity is only half of the productivity in China. The implementation of digital technology can massively increase Indonesia’s productivity level significantly, starting from the efficiency of the operating system. Industrial technology 4.0 that focuses on the concept of automation by combining the Internet of Things (IoT) and robotic machines is able to make business operations process faster, precise, and cheaper. Digitalization also opens the gates for businesses to collect user data, as Google does, to shape new markets and expand. The trick is to profile customers, conduct online surveys, or market testing. Businesses are better able to offer products that suit each consumer’s needs accurately with the utilization of big data.
Reference:
https://www.researchgate.net/publication/48926382_Digitalization_and_Innovation