Digitization

economic-dictionary

Digitization is the process by which analog processes and physical objects are converted to digital format.

In other words, digitization is the procedure by which certain operations can begin to be carried out through digital media, such as computers or smartphones, usually with the help of an Internet connection.

Similarly, digitization refers to a change of format, of articles or documents, from the physical to the digital. That is, the files are no longer on paper to move to a screen.

Digitization, it is worth clarifying, is a process that is not only carried out by companies or institutions. Rather, it is a change in the way people manage all kinds of information, from financial or banking to photo files that are no longer printed to put in an album. Instead, photos are now usually saved in a digital file and can be uploaded, for example, to the cloud.

Advantages and disadvantages of digitization

Among the advantages of digitization we can highlight the following:

  • It allows saving on paper and printing ink, since documents are archived digitally.
  • Continuing with the previous point, by using less paper, less waste is generated, helping the environment.
  • Digital documents are easier to share. For example, let's imagine that we are carrying out a procedure with an institution that is located in another city or country. Then, documents can be sent by email, arriving immediately. This, instead of mailing the corresponding papers, which would take days or weeks.
  • It is easier to locate a file when it is on digital media. This, compared to what it is to search for a specific document among a pile of papers.
  • Digitization also combats the informal economy and government corruption.

However, digitization also has some downsides:

  • Not all people can easily become familiar with digital media, especially if they are already old. So, even if an entity changes several of its procedures to digital, some of the users will be uncomfortable or reluctant to the new system.
  • Digital is not always infallible. It may be that, due to human error or a virus, for example, the files are lost.
  • Digitization is not usually immediate, it takes a certain time to be able to move all the files, for example, of a company, from the physical medium to the digital one.
  • When people share documents or information on digital media, there can always be a risk that the data will fall into the hands of unscrupulous people like hackers.

Digitization example

Let's imagine that a banking company, as part of its digitization process, has decided to allow credit card statements to be sent by post. They will do this gradually, starting by charging an additional amount for sending the physical document. In this way, customers are encouraged to only receive the information via email.

Over time, fewer and fewer bank customers should be willing to pay to receive their paper statement.

Tags:  administration passes comparisons 

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