Digital Transformation: The Latest Flavor in the History of Innovation

Digital is the latest promise in a long line of technology-driven innovation advances. 

Take your pick: digital value, digital transformation, digital customer experience, digital business, even digital disruption. All are top of mind right now with executives from backroom operations to the board room. 

In our rush to champion digital have we forgotten one of the most amazing innovations of all time? Paper. Yes, paper.  

As digital now looks to overtake and even eradicate paper, we would do well to remember the lessons learned along our journey to digital.

The First Competitive Advantage: Paper Making

The word “paper” is derived from papyros, ancient Greek for the papyrus plant used as a writing surface in ancient Egypt, which long preceded the creation of paper making in China around 105 A.D. 

The Chinese closely guarded their secret of paper manufacture and tried to eliminate other centers of production to ensure a monopoly. However through the captures of war, paper making made its way to the Islamic world, where they too kept it a secret. 

As with any great invention, the art of paper making eventually spread across the world, though it was not until several centuries later that the Europeans and ultimately the North Americans learned how to make paper. 

The making of paper was truly an amazing innovation:

“Paper is at the center of so many of the elements of the development of civilization,” says Mark Kurlansky, author of “Paper: Paging Through History,” a definitive history of paper and the astonishing ways it has shaped today’s world.

The End of ‘True Knowledge’

Of course, new ideas and ways often raise concerns. Thousands of years ago, Socrates and Plato warned that the written language would be the end of “true knowledge,” replacing the need to exercise memory and think through complex questions. 

Similar arguments were made about the advent of printed books on paper. Yet Johannes Gutenberg’s introduction of mechanical movable type printing to Europe in the 15th century is widely regarded as the most important invention of the second millennium, the “seminal event which ushered in the modern period of human history.” 

Paper, paper making and ultimately, movable type printing dramatically changed our business and personal lives for the better. So how did paper — one of the most essential milestones in technology innovation — become such a burden?  

Why Is Paper So Bad?

History shows we learned how to communicate better and more widely with the innovation of paper.  

Now we are determined to remove paper from our lives.  

We talk about driving costs out of our businesses by removing paper from our key processes, especially those that directly touch the customer, like onboarding, claims and mortgages.  If we look at our paper-based healthcare systems so fraught with quality issues, or our paper money system under siege by other payment options, it is perhaps not so much that paper is bad, but that digital promises significant advantages.  

Moving from Paper to Digital does a good job of describing the many comparative advantages of digitization over paper: 

• Superior Information Sharing: While the potential to distribute information on paper can be very limited by the number of copies you can make of it, a digital document allows for virtually unlimited information sharing 
• Improved Cost-Effectiveness: In terms of cost to the company, digital, due to its relative freeness, is more advantageous
• Increased Collaboration and Flexibility: Once printed, information on paper can be difficult to modify, which quickly makes the material obsolete and useless. Updating and customizing digital documents is easy in comparison. In the event of a loss or a degradation of traditional materials, a prior digitization offers easy access to their electronic version

These three points offer solid proof, but I see another area as the most compelling reason to move from paper to digital. That is, to better serve customers with processes that can efficiently handle exceptions in our new omnichannel world. 

As I described in my article about case management Helping the Insurance Industry Serve Customers,

“When a customer calls to dispute a rejected health insurance claim, the claim — that was otherwise on a path to be archived — must now be reviewed in an appeals process instead of proceeding on the standard path. The claim documentation, along with medical records, can be reviewed by doctors on both sides of the disagreement, and can be completed within a mandated time period. The case folder can advance through events, both externally and internally … contents can be added to the case folder, and new tasks or processes may be created.”

This process would not be possible with paper — it requires digital.

What the Move to Digital Really Means

Paper and printing laid the material basis for the modern knowledge-based economy and the spread of learning to the masses. So why are we now so focused on digital?  

The numbers tell the strongest story. The move from paper to digital has driven results like 30 percent acceleration of mortgage loan approvals and 80 percent faster insurance claim processing.  

Digital has changed our individual lives and the way our business enterprises get work done, just as paper making did in its day.  

The cautionary tale here is to look deeper at what an innovation represents not just at the innovation itself, and the lesson learned applies to digital as well as paper.

McKinsey believes that digital should be seen less as a thing and more a way of doing things. Our focus must be on three attributes:

• Creating value at the new frontiers of the business world
• Creating value in the processes that execute a vision of customer experiences, and 
• Building foundational capabilities that support the entire structure.  

With this approach, our journey from paper innovation to digital innovation and whatever might lie ahead should well be transformative. 

Digital May Transform, But Paper Still Inspires

As we undergo our digital transformation though, keep in mind that paper laid the basis for many of our advances and still has the ability to both amuse and inspire. 

Not convinced? Just imagine what we would be missing without paper in a digital-only world:

• The essential beauty of origami
• The fun and challenge of paper airplanes  (you have got to see this admittedly digital video about thinking outside the box!)
• The clever startup Lovepops that is getting notice in a waning Hallmark market, and 
• The feel of a good book in your hands

Digital is important and is irrefutably changing our world. 

But never forget that paper was once the innovation that changed the world and perhaps remains one of the most life-changing innovations of all time. Just try hurling a digital spitball and you will know the truth.

Title image by Jimmy Chang