What does process digitalization mean? Why should companies digitalise their processes and activities? And how can analogue processes be converted into digital ones? We clarify these and other questions in this guide.
Before we delve deep into the subject of process digitalization, let's first define a few basic terms. Because terms like process, enterprise process, process digitalization and process automation sound similar, but they are not really synonyms.
The term process has several definitions. In the business environment, it stands for a sequence of activities that influence each other and often take place one after the other. Each step serves to achieve a goal and obtain a desired result.
Corporate processes - also called business processes - are processes within companies. The work processes and their individual work steps serve, for example, to provide resources, to carry out measurements and analyses, to manufacture products and to distribute tasks. The specialist literature distinguishes between core processes, supporting processes and management processes, among others.
If you deal with the conception, implementation and control of business processes, you are working in process management - Business Process Management (BPM). If you optimise existing business processes, you are responsible for Business Process Optimisation (BPO).
Processes that function without the constant intervention of humans are automated. Process automation is about breaking down processes into such steps that they can be completed independently by suitable technologies. The result is partially or fully automated processes.
If you use process automation in your company, it is called business process automation. The technical term for this is Business Process Automation (BPA).
Human activities and workflows are digitalised in process digitalization. This means that such processes are no longer carried out by people, but by software applications or large IT systems. The input as well as the output are - casually speaking - an accumulation of bits and bytes.
What is known as process digitalization in German is called Business Process Digitalization (BPD) in English.
When you automate processes, you can do it with machines and robots. The processes are then done manually or semi-digitally. Process digitalization is about mapping processes completely digitally so that they are no longer tangible. But these do not necessarily have to run independently - i.e. automated.
If you mix process automation and process digitalization, you get automated, digital processes. This symbiosis is known as Robotic Process Automation (RPA).
In companies, process digitalization occurs in many areas. On the one hand, you can use process digitalization to digitalise existing, largely manual or analogue processes. On the other hand, increasingly better technologies such as machine learning (ML) or artificial intelligence (AI) make it possible to develop new, fully automated and digital processes.
Process digitalization is therefore not only about transforming established workflows one-to-one into the digital, but also about creating completely new, digital processes.
Rethinking is extremely important. Otherwise, you might transform bad, analogue processes into bad, digital processes. Fittingly, Thorsten Dirks, former CEO of Telefónica Deutschland, once said: "If you digitise a shitty process, you have a shitty digital process".
Accounting used to consist of a lot of "paperwork": Outgoing invoices were printed out and sent, and incoming invoices were entered manually and filed in folders. Thanks to process digitalization, such processes are now digital and (partially) automated: e-commerce systems create and send outgoing invoices independently, and incoming invoices land in the mailbox and are automatically processed by accounting programmes.
Returns and complaints can lead to high expenses in companies. This does not have to be the case! For example, CITRO digitalised the customer service for Sunrise Medical. Since then, enquiries are automatically forwarded to the responsible departments and made transparent. A central software ensures that a high volume of e-mail traffic and long Excel lists in customer care are a thing of the past.
With digitalization, the danger of cyber attacks is also growing. That's why companies need to properly secure their IT systems, but this usually involves a lot of manual, repetitive work. Special security solutions make it possible to automate tasks such as hardening systems - even in large system landscapes.
In other words: Why should processes be digitalised? The simple answer: because it makes processes more efficient.
There is no one-size-fits-all answer to this question. The selection of suitable tools is as varied as the requirements. CRM, DMS and ERP systems, accounting software, automation programmes, low-code platforms … what you use in the end depends on your requirements and goals. Therefore, it is eminently important that you approach your process digitalization in a planned and strategic way.
Even if it sounds tempting to take an all-in-one suite, in many cases this is not sensible. To meet your individual challenges, you probably need a customised solution. This may be a comprehensive toolset or individual applications developed specifically for you.
When choosing tools, don't just think about the status quo. Software solutions that seem suitable today may not be usable for scaling or change. Plan ahead and define what your needs are in the short and medium term.