Run on numbers: Is digitisation a friend or foe?

Since the advent of the digital age, digitisation and digitalisation have been buzzwords. Picture: Kacper Pempel, Independent Media.

Since the advent of the digital age, digitisation and digitalisation have been buzzwords. Picture: Kacper Pempel, Independent Media.

Published Nov 4, 2023


By Corrie Kruger

Since the advent of the digital age, digitisation and digitalisation have been buzzwords. Lately, digital transformation has also become a popular phrase in business and technology circles. Digitisation is the process of converting analog information to digital format.

Is the ordinary man on the street affected by these developments? The answer is a resounding yes! Unbeknown perhaps to some, the digital age has been with us for the last two decades at least, and it has affected people from all walks of life, from city dwellers to the most remote areas, but even in the most remote areas cell phones have become a part of every body’s life. The advent of smartphones has accelerated this phenomenon. Long gone are the days when a person would buy a newspaper to see what movies were showing and at what time. After the advent of the Internet digital platforms started developing which changed how individuals engaged with other people, businesses embraced the new technology to improve their own offerings. Some were slow in the adaptation and soon paid the price.

1. The world started to move at speeds that were not seen before. Moore's law is the observation that the number of transistors in an integrated circuit doubles about every two years. Moore's law is an observation and projection of a historical trend. Rather than a law of physics, it is an empirical relationship linked to gains from experience in production. Every year since 2001, MIT (Massachusetts University of Technology) Technology Review has chosen the 10 most important breakthrough technologies of the year. It’s a list of technologies that, almost without exception, are possible only because of the computation advances described by Moore’s Law.

2. Possibly the most successful social media platform in recent years is TikTok. TikTok was left out because it had long surpassed the million-user milestone before it even took that name. The app was created in September 2016 as Douyin, and within just over 200 days, had amassed over 100 million users. Its Chinese parent company rebranded the platform as TikTok in September 2017 for the international market, and a merger with two months later, cemented the social media platform’s presence in our lives from then on.

3. While digitisation refers to the act of making analog information digital, digitalization is all about moving existing processes into digital technologies. In other words, digitisation is for information, whereas digitalization is for processes. Digital transformation is the process of streamlining a company’s core operations and customer value propositions using emerging technologies. It’s a comprehensive strategy that requires changes to culture, structure, processes, and governance.

4. Supply chain technology, like any tech, is always advancing, and supply chain digitisation may be the biggest update to the supply chain we’ve seen in modern times. Digitisation of the supply chain means that the supply chain can use automated features and tracking technology to monitor each step of the process to complete tasks. In other words, it means greater efficiency, more agile processes, improved decision-making, and increased revenue.

Successful supply chain digitisation involves every layer of the supply chain communicating, collaborating, and sharing data in real-time. The digitized supply chain allows for data to be accessed at multiple points. Additionally, that data can be uploaded and shared more quickly and easily. The days of waiting hours, days, or weeks to communicate data and the results of data are long gone with digitisation, and require better cooperation and visibility between every part of the organization to make it a well-functioning machine.

A good example in this regard is Takealot, which has completely digitized the online shopping experience. From the moment one orders something online you can track exactly when collection can take place. The ease of transacting online and the supporting logistics solution is a great customer experience. A message is sent to the customer’s phone containing a QR code which on collection is scanned from the customer’s phone, and the item ordered is handed over. A QR code (short for "quick-response code") is a type of two-dimensional matrix barcode. In practice, QR codes contain data for a locator, an identifier, and web tracking.

Ian Wyatt of Daily Profit, asks the following question: “Are YOU scared of Artificial Intelligence? You wouldn’t be alone. 42% of people at the Yale CEO Summit say that AI could destroy humanity in 5 – 10 years. And 61% of Americans think AI could threaten civilization. Frankly, that’s normal. EVERY new technology is greeted with scepticism and fear – whether it is the automobile, television, the PC, or the Internet. Yet technology is unstoppable. Once released – it can NOT be reined in.

5. A very good example of the latest technology was excellently illustrated by Wesly Diphoko in an IOL article earlier this week: “The small block on the Springboks’ jerseys is known as the Apex device. It is a GPS wearable used in the world’s best leagues that meets standards for data accuracy, reliability, and consistency. Apex’s software includes the ability to monitor player and team demands specific to rugby.” It is due to this device that the management was able to know that a player such as Kwagga Smith, is the fastest of all the players to get back on his feet after a tackle and engage in the next relevant action required.

There have been cases when the implementation of digitisation has led to worse service levels than before. While digitisation has brought numerous benefits, it is not without its challenges. Here are some examples:

Automated customer support systems: Many companies have implemented automated customer support systems, such as chatbots or interactive voice response systems (IVR), to handle customer inquiries.

Online Government Services: Digitalisation in government services aims to make processes more efficient and accessible. However, in some cases, online government services can be plagued by technical glitches, security vulnerabilities, or complicated interfaces. The e-platform of the CIPC for instance is far from user-friendly. This can create barriers for citizens who are not tech-savvy or do not have access to reliable internet connections, leading to worse service levels compared to traditional offline methods. Our government systems rely on systems that often break down and become dysfunctional as there is not sufficient day-to-day support.

E-commerce Delivery Services: The rise of e-commerce has significantly changed the retail industry, but it has also brought challenges in the field of delivery services. While digitisation has streamlined the ordering process, there have been instances where e-commerce companies have struggled to meet shipping expectations. Issues such as delayed deliveries, lost packages, or poor communication can lead to dissatisfaction among customers. Shoprite Checkers has implemented an efficient delivery system and they have left the rest behind.

Online Banking and Financial Services: While online banking has provided convenience and accessibility, it has also given rise to new risks. Cybersecurity threats, including phishing e-commerce attacks and data breaches, have the potential to compromise customer accounts and sensitive information. These incidents can erode trust in online banking, and lead to worse service levels as customers may feel uncertain about their financial transactions.

Electronic Health Records (EHRs): The digitisation of health records is aimed to improve the efficiency and accessibility of patient information. However, some healthcare systems have faced challenges in effectively implementing and integrating EHR systems. Issues such as interoperability problems between different systems, data entry errors, or technical difficulties can interfere with the seamless exchange of patient data, affecting the quality and timeliness of healthcare services. It is time that the patient became the main custodian of his or her health record which with digitisation is extremely easy. In South Africa Discovery is miles ahead with its digital data base which enables doctors access to specific patient data.

Digital tax return systems: The digitisation of tax return processes aimed to simplify the process for taxpayers and improve the efficiency of tax authorities. However, the complexity of tax regulations and the user interface of digital systems can sometimes lead to confusion and error. This can lead to delays in processing tax returns, incorrect assessments, or problems in resolving problems, which can ultimately lead to worse service levels for taxpayers. Tax practitioners believe SARS is overly dependent on their e-service capabilities, and that face-to-face problem-solving is not given sufficient attention.

Every individual can be thankful for the benefits digitisation has brought to their lives. One should not be scared of new technology such as Artificial Intelligence, but rather embrace it to enhance your own capabilities.

* Kruger is an independent analyst.