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Digital Business Strategy: What is the impact of digitalization in Business Strategy?

Kirjoittanut: Julieta Villafuerte - tiimistä Ei tiimiä.

Esseen tyyppi: Akateeminen essee / 3 esseepistettä.
Esseen arvioitu lukuaika on 6 minuuttia.


Nowadays, high numbers of business tasks are performed using computers. The age of filing papers and dealing with cabinets as clerical jobs are already over. The wide spread use of technology is taking companies to move further in the next level of technology which is the digitalization. This technology improves business intelligence and performance in several fields within the company. It maximizes the opportunity of the world wide web to create new goals, new products and in any case where the technology is being implemented supporting the business objectives.

“Digital strategy focuses on using technology to improve business performance, whether that means creating new products or reimagining current processes. It specifies the direction an organization will take to create new competitive advantages with technology, as well as the Tactics it will use to achieve these changes. This usually includes changes to business models, as new technology makes it possible for innovative companies to provide services that were not previously possible.”(Christine Reyes, LifeRay.2023)

2. Digital Strategy is not Digital transformation.

Often times we describe digitalization in general as an associated process using technology with the inclusion of Transformation and internal pivot within the business system. To understand better the role of strategy in a business let us differentiate digital transformation to strategy.

Though these two are closely related but they differ in extent. Digital Transformation is a process that requires coordination in the system focusing on the function of the entire organization. These include customer service, production or the operational process, the culture changes and the business models .

On the other hand, digital strategy is the opposite of the transformation. It is mostly applied to changes in business models and utilizes the technology to create something new, create potentials which would lead the company to see the need to pivot digitally and unlock digital possibilities . It focuses on technology instead of culture changes and serves as a key component of the Transformation process with the guarantee that technology is being widely used and is aligned to the business objective.

3. Digital Strategy needs to become the Essence of business strategy.

Digital strategy is all about concept and a thing and that it should eventually lead to the creation of a concrete plan or a road map. Therefore, treat your strategy as a Vital core of your business strategy. (Christine Reyes, LifeRay.2023)

As an example, say your digital strategy which is your Ultimate goal is to monetize basic productivity software that your business has already developed and uses internally. At first, you lay out a strategic plan to package it as a mobile app and sell it to individual users. Later, you realize that it has more value if you sell it to businesses to incorporate into their own mobile apps. Your ultimate goal strategy didn’t change, but your strategic plan did. Changing the Guiding idea of ​​your digital strategy should amount to a big shift or reorientation for your company, but ideally, the concrete steps will be flexible enough to allow you to pivot as needed.(2023, What is Digital Strategy?)

To further understand why digital strategy must become the Essence of the business strategy to acquire positive impact of digitalization in the business strategy, another example is given:

People prefer variations and more options when it comes to wanting to know about what is happening around the world. The live broadcasts, video clips and live Streams are gaining more attention with the newspaper industry. For the past decade, newspaper is gradually fading its popularity due to the widespread of internet use. It has become

Over the past decade, the Popularity of Newspapers has waned due to the widespread digitization of content. However, one newspaper, in particular, has managed to thrive in the face of this disruption. Unlike many incumbents who have struggled to stay afloat, the New York Times has been slowly adapting itself over the past decade and has managed to position itself firmly to compete in the digital world. After launching a simple article-hosting website in 1996, they have successfully transformed into what is now a highly profitable multimedia platform.4

Like other newspaper publishers, the New York Times once faced the prospect of losing its footing in the market due to the threat of digital disruption. However, by executing the right strategies it seems to not only have weathered the technological storm but has gained an advantage over its competitors.

For example, the Times implemented a carefully designed paywall and subscription model for its online content that allowed the company to continue to deliver the same type of high-quality journalism and content while continuing to earn revenue. This method appears to be working. For the fourth quarter of 2021, revenue from Subscriptions rose by approximately 11 percent, to $351.2 million. For the 2021-year, revenue rose by 16.3 percent, to $2.1 billion. This is its first $2 billion year since 2012. (2022, GetSmarter)

With the given examples, a company working with digital strategy should be visionary enough to carry them through changes in the digital economy bringing a digital edge to the business adopting to the impact of digitalization.

Digital strategy is all about scaling the existing model into digital channels. The focus is on the customer and growth, not on the company’s own processes.

4. Digital business strategy makes the impossible possible.

Digital business strategy guides the innovation of new products and new capabilities that were previously impossible because it requires more time, Manpower and physical tools, but with the use of technology, opportunities for new products will evolve and will highlight the areas of growth, efficiency and competitive advantages.

When a small business restructures to adapt to the realities of the digital age, expect Unlimited opportunities to become big and successful. Adopting digital business concepts and digital strategies can help improve customer experience, boost productivity, and leverage business intelligence. It is not easy of course, turning a business into digitalization, it takes a long process of learning, adopting, planning and practicing. In a survey conducted by Tech Pro Research in 2019, 70 percent of business leaders reveal that they are investing more time and energy into Digital strategy. So why are businesses seeking digital business transformation if this is the case. The answer is simple, digital transformation is the new normal, and it helps companies to work smarter and not harder. (Stefan Mitzkus, 2022)

Before the word digitization came into existence most businesses set goals for globalization, which also requires a lot of effort, time and great investment. Maybe this is the only difference from these two, digitalization and globalization. Digitalization allows you to go global but with less investment. At least not even close to what you could Invest to go global with all the legalities and dealing with language barriers. Anyway, one example I would like to share in this paper is how IKEA – which is named after the Initials of founder Ingvar Kamprad, Elmtaryd, the farm on which the founder grew up, and Agunnaryd, the nearby village.”

Before becoming the largest furniture retailer in the world, Ingvar Kamprad started IKEA as a mail-order sales business in Sweden in 1943. IKEA is now a global conglomerate or a multi-industry and multi-sector business organization. The success of this organization can be attributed to specific business strategies and tactics that revolve around offering well-designed and functional products at affordable prices. But now, IKEA is in the middle of a transformation of its business model that made it successful on a global scale. Specifically, for many decades IKEA’s business strategy was primarily based on having giant out-of-town warehouses, where shoppers pick their own furniture and then build it at home. But now it is looking increasingly at city-center stores, online shopping, home delivery and assembly,

“Digital Transformation is not a goal in and of itself, and it is so much more than technology. We are Transforming our business: We are Exploring potential new offers to customers, new ways to bring our offers to customers, and new ways to operate our business. And in order to be successful, digital needs to be embedded in every aspect of IKEA. Digital is a way of working, making decisions, and managing the company. (Bara Martin Coppola, CDO at IKEA Retail)


A digital strategy is nothing to be afraid of, it is a huge opportunity for success and growth which anyone can have access to. Only, it requires close attention to the quality of the process since it does have its dangers. Mistakes on the way to finalization can cause the construct to collapse. So, you are well-advised to get expert knowledge about how things should be done. No cooperation can be more expensive than errors in the system. Because once an appropriate integration has happened, all components are chosen to interact with each other then everything will get affected. If you have saved money at one point, in the worst case the entire process can start all over again. Focus on the key points of your strategies, planning, Defining your target audience and what are the unmet needs, mapping, establishing benchmarks, use best practices and analyze and optimize and continue to innovate and the cycle continues, Transformation is not easy but working smarter with an opportunity to become big and successful and something to keep. Do it right then experience the impact.

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