Digitalising your business: the advantages and disadvantages
- Esther Riphagen
- 9 Sept 2023
- Edited 27 Nov 2023
- 3 min
- Managing and growing
Do you send invoices online, or do you sell your product(s) on social media? These are just two examples of digitalisation. Some possible benefits of digitalisation: more turnover, saving time, or returning customers. Discover the opportunities provided by digitalisation and how to use it.
What is digitalisation?
Digitalisation is a way to adopt a more efficient or smarter approach to work. You leave manual jobs, such as creating invoices or submitting sales orders, to a computer. When you digitalise customer or revenue details, this is referred to as ‘data’. Computers are able to process data more accurately and more quickly than human beings. While the start-up process takes some time, once this is completed digitalisation saves you considerable time and money.
Benefits of digitisation
Digitalisation offers your business several benefits, such as:
- Digitalisation offers your company structure, allowing you to achieve the desired results faster;
- By carrying out (parts of) your work processes digitally, you are less likely to make mistakes;
- Communication with colleagues and customers becomes easier, because you use multiple channels (email, chat, a CRM system);
- You save costs, because you print or copy less often;
- You work more sustainably, because you use less paper.
Disadvantages of digitisation
Digitisation also has disadvantages:
- Purchasing software costs you money;
- You become (partly) dependent on technology and may lose business information in the event of an online failure;
- Security risks may arise from data leaks or cyber attacks.
Starting with digitalisation
The ABC model allows you to identify opportunities for digitalisation in your business: supply, business operations, or commerce. You decide in what areas digitalisation will be most useful. The various components of the ABC model do not rule each other out: they complete each other and impact one another.
Your supply is the product you create or manufacture or the services you provide. The question is whether your supply aligns with your customers’ needs. Keep in mind what your customers want now and in the future. Opportunities for digitalising your supply include:
- Launch an online shop in addition to your brick-and-mortar store, to ensure your product or service is available online as well.
- Provide your services online, through webinars or an electronic meeting.
- If you also already operate a website or online shop, look at the visitor statistics and sales data and improve your website’s performance.
‘Business operations’ refers to all activities and processes within your business. Digitalising these activities and processes could potentially save you a lot of time. There are different ways of digitalising your business operations:
- Set up an online accounting system and a cloud-based cashier system. This ensures you can keep track of your data at any time.
- Send digital invoices. This is inexpensive and works efficiently.
- Automate stock counting, purchasing, and sales orders (in Dutch). This reduces the number of errors you make and saves time.
‘Commerce’ refers to the sale of your product(s) or service(s), including interaction with your customers, marketing, and actual sales. Digitalisation in commerce tends to mean e-commerce: doing business online. Examples:
- Managing customer relations with a Customer Relationship Management system or simplified CRM system. This enables you to provide better services to your existing customers and makes it easier to recruit new ones.
- Creating an online marketing plan.
- Retaining customers through a business website, social media, email marketing (in Dutch), or a podcast.
Schemes and grants
The Dutch government provides a number of different schemes and grants related to digitalisation – learn more about them and save money.
- If you manage development or research projects, reduce the costs through the Research and Development (Promotion) Act (WBSO). This is an innovation scheme that reimburses a portion of the costs and expenses of your project through taxes.
- If you are an SME owner who does business internationally, you can use the kickstart voucher. You can use this voucher to receive an 80% discount if you hire the services of an external consultant you choose yourself, subject to a maximum of €2,500. The consultant will help you digitalise your business.
Digitalisation in practice
If you are curious to find out what kinds of steps other businesses in your sector are taking, ask your trade association for tips and advice. For practical assistance, you are better off working with a MKB DigiWerkplaats (in Dutch).