Digitization

How do businesses expand digital competence? In this article we will answer questions about digital skills and how to teach your employees properly.

In this article:

1. Digital competence definition
2. How important is digital competence?
3. The 10 most important digital skills
4. Build up digital competence: Our 5 step guide
5. Possible hurdles and challenges
6. Will analogue processes soon be replaced completely? 
7. Conclusion

The most important in a summary

• Digital competence has become increasingly important in the world of work.
• Ideally, businesses aim for a step-by-step execution in which all employees are equally involved.
• Analogue processes become less important but a complete digitization of existing structures will take time.

Digital competence definition

The term “digital competence” describes all required skills to use computers and other devices as well as to manage and process information through these devices. That includes the successful usage of specific applications to edit, save and publish content.

For a long time digital competence was limited to answer mails and to use office applications such as Word or Excel. But in 2023 the requirements are much higher. Cloud applications, online meetings and digital administration determine the daily life of office employees.

The expansion of digital competence requires a holistic approach which doesn’t only consider the skills of your employees but improving existing business structures too. Keyword: Digitization.

Ideally, businesses aim for the goal to encourage the knowledge of their employees as well as the renewal of existing structures. Without expanding existing structures, digital competence has no value. On the other hand employees don’t know how to use digital ways if they don’t acquire relevant know-how.

How important is digital competence?

More and more employees work from home and use the possibilities of digital communication on a daily basis. That is one of many reasons why the expansion of digital competence becomes more relevant. Businesses are responsible to encourage their employees to work more efficiently and to establish smooth working processes.

The right handling of digital applications has not only gained in importance in recent years. Already in a survey of 2018, 71 percent of managers said they want to open up new ways of income by using digital ways. The covid pandemic has further spurred this trend, as online retailers in particular have increased their sales.

→ Competence expansion goes hand in hand with the expansion of business structures. Every expansion or adjustment of processes requires adequate know-how.

The 10 most important digital skills

Digitization affects almost all company departments and they all require different skills. Therefore, there is no such thing as the “one” skill but rather a variety of many competences. Including the following:

Search engine optimization: Essential to improve the positioning of a website. Without SEO a website will disappear in the “google nirvana” and possible competition advantages remain unused.

Social media marketing: Platforms such as instagram, pinterest or linkedin have developed to profitable sales channels for businesses in the past years. That is even confirmed by statistics: In 2021 businesses earned more than 150 billion euros through social media.

Web hosting: That includes management of a website, blog or online shop. Web hosting is not only about uploading new content or creating new sub pages for a website, it’s also about evaluating statistics to improve performance.

Content production: Social media won’t ensure growth if businesses post low quality content. Possibilities in content marketing reach from picture design to video production.

Digital communication: The usage of applications such as zoom or google meet belongs to the basic knowledge of all employees.

Product management: Develop, manage and market digital products. Hereby many businesses focus on lead generation by offering digital products for free, so called “freebies”.

User experience: It takes 50 milliseconds until website visitors get a first impression. Many businesses ignore user experience because they primarily focus on technical requirements (e. g. SEO). However, the target group should always be the number one priority.

Cloud solutions: Using applications such as google docs makes it easy to share data and saves time as you don’t have to send mails with attachments.

Service and customer management: Data banks and customer relationship management systems simplify the management of customer data and reveal more about the wishes and desires of your target group.

Programming: The king discipline among digital skills. There are thousands of programming languages but the most known ones are PHP, java and python.

Build up digital competence: Our 5 step guide

To successfully promote the digital skills of your employees, you need to take measures but also consider hurdles and possible challenges. We have prepared the following guide for you so that the implementation is successful. It will help you to encourage the digital competence of your employees in just five steps.

Know the needs of your team and your business

The expansion of skills costs resources, especially time and money. That’s why the first step requires a plan and a goal oriented needs assessment.

Let’s come back to the ten digital skills: Almost every business takes advantage when it schools its staff in the area of digital communication or service. However, it doesn’t make sense for businesses to invest in programming knowledge. There are only a few businesses which take advantage of this kind of internal know-how.

The following questions will help you to purposely determine your businesses needs:

• In which industry is our company active?
• What goals are we pursuing?
• What is the current level of knowledge of our employees?
• To what extent do we benefit from the development of digital competence?
• What knowledge and skills do we source externally?
• What are the costs associated with expanding digital skills?
• Are employees we train for specific areas likely to stay with the company longer?

Recognize the value of further education

Sure, further education is a purposeful way to expand the competence of employees. But it’s even more important to invest in the right measures. Online platforms such as Udemy can indeed provide valuable knowledge but on such websites are also course suppliers who don’t even understand their own profession properly. Hereby it’s better to consider other sources, even when they are more expensive. Get back to expert knowledge to school your employees as well as possible. Sure, that costs more at the beginning but ensures a purposeful investment in the long term.

Sure, there are also ways to get free access to know how. Platforms such as LinkedIn or YouTube provide a variety of possibilities for further education. Especially in the field of digital communication, cloud usage and user experience it’s not necessary to invest in expensive education measures to school employees properly.

Obtain external knowledge

In many cases it’s much cheaper and more sustainable to get back to external knowledge. One example is building and maintaining the business website or programming an app.

Businesses also have the possibility to combine internal and external knowledge. Here, the business website is again a great example: External web designers or programmers promise a purposeful investment because their expertise, including the areas of social media and SEO, requires years of project experience. In turn, employees can manage and maintain the website. But also other tasks such as entering new products in an online shop don’t require external knowledge for execution.

Through a cost-benefit analysis businesses determine the goal oriented usage of their budget and such a consideration is to be used for each investment. But as a rule of thumb we recommend the following: Big projects, for example building the business website, are better given into the hands of external experts. It requires too many resources to properly teach employees how to do it. In turn, it is cost wise more reasonable to, for example, build social media channels with an internal team.

Don’t get lost into details

Expert knowledge ensures advantages in competition and more growth possibilities but in many cases the basics are completely enough. Your business doesn’t need professionals who know every single detail function of Google Docs or Google Meet. Knowing the basic requirements is enough. Therefore, don’t only consider which measures are purposeful but also to which extent.

Consider current trends

The term “digital transformation” describes the current situation perfectly: We are in a constant transformation which doesn’t allow standstill. That also means that our level of knowledge is constantly sinking. Who would’ve thought that we would use social media channels such as TikTok only a few years ago or that the stationary trade will focus more on e-commerce. But it is exactly these unpredicted changes which bring businesses into the position to find ways to expand their employees’ knowledge. The expansion of digital knowledge is not a one time project but a long term process. Therefore, initiate steps to ensure a long term expansion of knowledge.

Possible hurdles and challenges

Executing a plan is not a one-way street. When expanding the digital competence of your company, some hurdles and challenges might be in your way. Including the following:

• No unified level of knowledge
• Personnel fluctuation
• Growing requirements

No unified level of knowledge

Further education, as purposeful as it is, comes with a major weakness: The educational content is aimed at several people at once. As a result, some employees have too low or too high a level of knowledge. Beginner oriented training provides no value for advanced employees, on the other hand, programs for the advanced are no good approach to introduce newcomers to a topic.

Solution approach: Don’t only consider training programs for all employees. Instead, help your staff to find suitable mentors to expand strengths individually.

Personnel fluctuation

Qualified employees can choose between many employers on the market. This also increasingly reduces operational loyalty. This is a big challenge for companies as they lose internal knowledge when employees leave. As purposeful the investment in the knowledge of employees is, it might not have any long term advantages because other companies appear more attractive.

Solution approach: Don’t forget to prioritize the expansion of a positive working climate. Employees aren’t just human resources, they are human beings who belong to your business. You can’t avoid job changes completely but you can initiate measures to make your business more attractive to employees to make them stay.

Growing requirements

Digital progress promises solutions and makes business processes easier. However, requirements regarding operation, administration and editing grow too. That on the other hand requires higher investments in training and the expansion of competences. There is no doubt that the expansion of digital competence is worth it but you shouldn’t underestimate the volume of investment.

Solution approach: The already mentioned cost-benefit-analysis helps to determine goal oriented measures. Know your team’s level of education and focus holistic as well as individual approaches equally.

Will analogue processes soon be replaced completely?

Prognosis regarding the future influences of digitization suspect a successive omission of analogue applications. But this process will take time. There are still too many businesses which primarily rely on analogue processes and although many of them pursue the goal of digitization, they often don’t have a concrete plan.

The development of start-ups and new founded businesses suggests that young businesses rely on digital structures from the very beginning. Business size and smaller structures play a role here too. The digital construction of a small business is done less complicated than restructuring analogue processes of bigger businesses with more than 100 employees.

But big businesses digitize their processes successfully too. German statistics actually confirm that especially businesses with more than 250 employees use the strengths of social media. Furthermore, there are barely big businesses without their own website or a digital marketing strategy.

In some areas it is to expect that analogue processes will be replaced completely, especially in marketing. Reasons are measurability and that businesses reach out to a broader audience. But digital marketing strategies require deep knowledge in social media and SEO. Therefore, businesses are responsible to school their employees to not only expand digital structures but to ensure long term results as well.

Conclusion: Build on progress

Digitization is advancing and so is the expansion of internal competencies. New trends, especially in marketing, put companies under pressure to pull. Digital change may progress faster than the level of knowledge in the company is growing.

It is necessary to weigh up which trends and competencies offer added value. In addition, it is purposeful to build on existing strengths in order to ensure specialist knowledge. As already mentioned, it therefore makes little sense to get lost unnecessarily in details. On the other hand, it has disadvantages in competition if companies do not offer further training in certain areas.

In this article you will find out everything you need to know about data warehouses. All information about definition, advantages, tools and application.

In this article

1. What is a data warehouse?
2. Data warehouse: Components and functions
3. These are the pros and cons
4. Data Warehouse vs. Data Lake
5. Which data warehouse tools are available?
6. This is how businesses use data warehouses
7. FAQ

The most important in a nutshell

• A data warehouse is suitable for processing and evaluating company-related data
• Disadvantages include long loading times and that only structured data can be processed
• Access to data lake is easier but the method is not useful for processing structured data

What is a data warehouse?

Data warehouses describe a database which was specifically optimized for analysis. The system collects and processes relevant data from a summary of sources (e. g. apps or internal departments) and provides it clearly for businesses. The goal is to get a general overview of all important data.

A data warehouse is some kind of a data management system which supports business intelligence activities as well as it collects and saves huge amounts of data. The collected data passes through a formatting- and import process which compares existing information of the data warehouse. The following saving process ensures a simple data access. From this page, companies can derive important business data and optimize decision processes.

Data warehouse: Components and functions

A data warehouse normally consist of the following four elements:

• ETL solutions to prepare data for analysis
• Data mining functions
• Relational database to save and manage data
• Analysis applications to evaluate data and to visualize it easily

This is how a data warehouse works

Data warehouses don’t have a unified architecture. Instead, the specific requirements of a business determine the structure. When the business requirements are defined, conception follows. This includes the logical design (relationship between elements) and the physical design (best method to save and retrieve data).

During the design process of the data warehouse there are some steps to consider, including the frequency of data update, the supported system environment and the relationships between the different data groups.

The following process, the so-called “data warehousing”, normally takes place in four steps:

• Data acquisition + integration: Data is obtained from sources and loaded into the data warehouse
• Data storage: Data is held
• Data evaluation: Full analysis of structured data
• Data provision: Data is made available for analysis

These are the pros and cons

Businesses have specific advantages when using a data warehouse. The probably biggest advantage is that huge amounts of different data can be analyzed and evaluated purposefully. The data is easily accessible, goal oriented and relevant. That improves data quality and the decision making process within a company. Hereby, flexibility doesn’t get lost and businesses can, for instance, reduce data volume for an accurate verification.

Disadvantages include long loading times for complex data and increasing data volume. Furthermore unstructured data (e. g. audio) can’t be processed and live streaming isn’t possible either.

→ The access through a data warehouse is principally uncomplicated but associated with high effort.

Data Warehouse vs. Data Lake

Data Lake represents an alternative to the warehouse variant for data processing. Data lakes are better for unstructured data such as pictures or live streaming because they are easier accessible and therefore don’t require any expert knowledge. Furthermore, businesses have the opportunity to analyze bigger amounts of data on different ways to win new insights regarding relevant company data.

The data warehouse on the other hand has the advantage that structured data builds a good base for analysis which matches with the predefined business goals. The evaluation also happens much faster. And through the precise data evaluating processes, businesses can trust on the results and make decisions fast.

Use the strengths of both methods to bypass disadvantages

You don’t have to choose either of the two methods to evaluate data. Both ways complete each other and in combination provide a goal oriented approach to evaluate data. Data lake has more storage capacity and allows the deposit of big data quantities. The processed raw data can be structured and further processed with data warehouse tools.

Which data warehouse tools are there?

• integrate.io
• Informatica
• Oracle 12c
• IBM Infosphere
• Amazon Redshift
• Ab Initio Software
• ParAccel
• MarkLogic
• Cloudera

The tools belong to the ten most known and popular tools for processing data. Each of these tools has its individual advantages and was made for different application areas. For businesses it’s worth it to use at least one of these tools to make processes of data evaluation easier.

Cloud data warehouse: Which options do businesses have?

Cloud data warehouses become more popular to collect and process data from different sources. Data warehouses require a lot of effort in administration but cloud solutions provide a user friendly application which doesn’t even stress beginners. Furthermore, a cloud data warehouse ensures advantages regarding costs because there is no maintenance needed and businesses don’t have to invest in additional safety software.

But that doesn’t mean that internal solutions are bad. The opposite is the case. On-premise-servers ensure more safety and businesses have more control over data procession. So whether cloud-based solutions offer a better alternative is a matter of individual consideration.

This is how businesses use data warehouses

Businesses have many application possibilities with data warehouses. They primarily use it to provide reports to evaluate processes and to optimize them. This also results in more transparency to provide stakeholders a better insight into business processes. Processed data can also be used to determine information regarding commercial transactions.

Other application areas:

• Determination of resources and costs
• Getting information about business related KPIs
• Evaluation of concrete processes
• Structuring of data

It’s important to define goals and to know the requirements of users to use data warehouses properly. A data warehouse is a centralized collection of earmarked business data. Furthermore, changing data causes a lot of effort whereby inadequate goal planning may waste resources.

FAQ

Lastly, we will answer common questions regarding data warehouses.

What is an ETL process?

ETL consists of the individual steps Extract (E), Transform (T) and Load (L). The ETL process ensures that data from different sources is integrated into the data warehouse. It’s used primarily in scenarios with large volumes of data (e. g. big data).

What are the primary differences between a data warehouse and a data mart?

A data warehouse is normally larger than a terabyte and ranges across multiple areas. Data marts on the other hand are mostly smaller than 100 GB and are limited to a single purpose for one line business.

What does a data warehouse cost?

The costs of a data warehouse vary but typically it is between 350 and 400 euros annually. Cloud services and on-premise-solutions hardly differ in terms of costs.

What is the ultimate outcome of a data warehouse?

A data warehouse ensures precise insights into business data which makes decision making easier and therefore helps to save costs. Stakeholders get access to visualized and analyzed data which was evaluated based on business related goals.

Sources:

https://www.talend.com/de/resources/was-ist-data-warehouse/

https://www.weclapp.com/de/lexikon/data-warehouse/

https://www.bigdata-insider.de/was-ist-ein-data-warehouse-a-606701/

https://www.oracle.com/de/database/what-is-a-data-warehouse/

In this article, we will answer all your questions about data management. Advantages, examples, data security and best practices for your strategy.

In this article:

1. Definition: What is data management?
2. Data management tasks
3. Three steps to successfully execute a data management strategy
4. These are the challenges
5. Advantages of data management
6. Advice for your data management strategy
7. Conclusion

The most important in a summary

• Data management provides many advantages such as safety, cost savings and efficiency
• Innovative solutions don’t cause any problems regarding GDPR
• Many businesses complain about the missing transparency in data management

Definition: What is data management?

Data management belongs to the digital competencies and combines all elements of information transfer within a company. The goal is to establish methods and processes to save, to minimize and to archive data.

Many businesses have already established data management to automate working processes and to relieve staff. Furthermore, they pursue the goal to minimize mistakes and to ensure more transparency. Last is especially important because only when businesses consider current data they have the possibility to optimize processes sustainably.

In this article we will talk further about data management and its tasks. We will show you all pros and cons as well as common challenges. Other than that we will answer questions regarding data security and strategy.

Tasks of data management

Basically, the main task of data management is to save business related data transparently. Through that, stakeholders get insights into data and structure to make solution oriented decisions. Furthermore, businesses minimize their error rates and use their budget efficiently.

Data management is not limited to essential operation areas. Many might think of financial stuff and bookkeeping when they hear the word data management, but evaluating marketing KPIs and factors to improve quality management is also considered in the process.

Data management is a holistic process which takes over the following tasks:

• Easy access to business data
• More transparency
• Establish automated and efficient working processes
• Ensure safety and prevent data loss
• Comply with retention obligation
• Eliminate old or not needed data

Three steps to successfully execute a data management strategy

To successfully execute a data management strategy, businesses need to consider questions regarding data sets, data structure and data saving. The following three steps help you with that.

Know and understand your data sets

The first step of a successful data management strategy requires knowledge about data itself. Without understanding data sets of your business you can’t create a goal oriented strategy. A systematic analysis considers three types of data, namely personal-related, “High-value”-business data and public data.

Personal-related data includes all data sets regarding your target group and other natural persons. This includes name, address and email. For these data sets the requirements of GDPR are to consider.

“High-value”-business data is sensitive business data. This includes bookkeeping data, tax documents and financial data. The encryption of this data is highly important.

Public data is accessible for everyone and concerns the area of marketing. Through transparency regarding marketing KPIs (social follows, website visitors etc.) businesses have easy access to relevant data but they have to consider to avoid intellectual property damages.

Structure data properly

Data-lake and data-warehouse belong to the most known methods of data saving. The data lake is a large store of raw data whose use has not been determined. In contrast, the data warehouse is a central collection of business data that is tied to a purpose.

Data lakes are easily accessible and do not require specialized knowledge to modify new data. However, data can only be accessed with specialized tools or by experts (e.g., data scientists). Data access via a warehouse is much less complicated, but data modification requires more effort.

Many businesses use both methods to have more advantages. Data warehouse requires less expertise for data retrieval and is more secure. On the other hand, data lake has advantages in terms of flexibility and data storage.

Storage environment

The best-known model of data storage is the cloud. This offers a variety of benefits to businesses, including secure data storage, greater flexibility and resilience. As an alternative, many companies are turning to server-based computing in the form of an internal storage environment. Hard to beat in terms of security, but not accessible to third parties without a cloud service.

To form better interfaces, there are so-called “data fabrics” on the market as storage environments. This concept combines the strengths of cloud services with those of internal storage environments and equips them with additional functions to ensure greater security as well as flexibility.

These are the challenges

Data management has many advantages (more about this in a moment!) but businesses face many challenges during the process of implementation. Some of them are:

• Costs
• Data volume
• Requirements of stakeholders

Costs

Data administration causes costs. Although data management ensures cost savings, it’s still recommended to carry out a cost-benefit-analysis to invest available budget efficiently. Therefore, it’s less about if a data management strategy is financially worth it, but rather to which extent the budget is invested.

Data volume

With too much data volume, transparency might get lost. The usage of data management software reduces this risk but the danger of loss still exists. Without a goal oriented organization and planning, there are also no advantages regarding transparency and efficiency because your business might evaluate the wrong data.

Requirements of stakeholders

Data management pursues the goal to establish solution oriented as well as efficient working- and business processes. Hereby the requirements of stakeholders are to consider to evaluate collected data purposefully.

The bigger the company, the more complex are probably the requirements of stakeholders. That possibly aggravates goal oriented data management because wishes and expectations of single persons might go too far apart through which no clear goals can be determined based on the evaluated data.

This is how businesses master these challenges

Clarify requirements, knowing goals, planning resources purposefully and choosing high quality software. These four steps build the base for goal oriented data management. Especially stakeholder requirements and data saving are no hurdles with a detailed plan. In terms of costs, there are advantages with a data management strategy anyway, but insufficient calculation of personnel deployment may waste financial resources.

→ Simply explained: Planning is everything!

This is how you ensure a GDPR compliant realization

In May 2018, the European Union adopted the General Data Protection Regulation (GDPR), creating a legal framework for data processing. This legal framework is based on principles such as fair processing, lawfulness, adequacy of data processing, integrity, purpose limitation and accuracy.

Companies have a responsibility to ensure these principles in their data management. But in practice, this is not so easy. Even one incorrect setting in the website cookie banner may already lead to unlawful data processing. Good compliance prevents such difficulties.

Declarations of consent form the basis for DSGVO-compliant data processing. In addition, companies must comply with their administrative obligations and delete data upon request. A regularly changing legal situation complicates this process, so staff and involved stakeholders must be trained regularly.

The advantages of data management

Regardless of the mentioned hurdles and challenges, a goal oriented data management has many advantages for businesses. Some of them are:

• Transparency
• Problem identification
• Eliminating disruptive factors
• Targeted working processes
• Process automation
• Better user experience
• Recognizing customer needs

Transparency

The accumulation of big amounts of data are barely overlooked by businesses which is why they often oversee important sets of data. Through a targeted administration, businesses ensure more transparency and can evaluate as well as organize data purposefully.

Problem identification

Transparent processes result in better problem identification. Organizations have a lot of interactions going on, whether between software applications or protocols – and good data management helps identify the problems created by processes.

Eliminating disruptive factors

Problem identification ensures an uncomplicated solving process of disruptive factors. Besides that, it’s easier for businesses to execute prevention methods to avoid difficulties in the future.

Targeted working processes

The main goal of data administration is to optimize working processes. Through transparent data evaluations, businesses recognize their potential and use it. No matter if it’s for marketing, human resources, bookkeeping or quality management. Businesses recognize, for instance, which marketing methods generate the most leads or which benefits motivate employees the most and then can improve existing processes based on that.

Process automation

Through performance and process monitoring, business can stop processes and methods which require too many resources. That, on the other hand, ensures possibilities and process automation.

Example: If companies try to implement too many marketing measures, the test phase takes longer and requires many resources. With more transparency regarding the target-oriented marketing measures, it is possible, for example, to optimize and automate lead generation. This is because companies can see what their marketing team is investing time in and thus shift the focus to the processes that lead to the goals.

Cost savings

The elimination of non-targeted processes results in financial advantages. Businesses are less focused on such tasks and approaches which don’t promise any success. Furthermore, they reduce the effort for testing phases.

Better user experience

The advantages of data management are not only internal to the company. Data administration reveals important information about customer wishes and which advertising works best. It’s also easier for businesses to react to trends. Hereby, there are advantages in the area of user experience and target group approach.

Recognizing customer needs

Feedback and ratings are among the most important sources for businesses to get to know their target group better and to identify customer needs. Structured data management helps to evaluate all collected sets of data better and to recognize customer wishes accordingly.

Advice for your data management strategy

Develop a holistic and waterproof strategy

A good and goal oriented strategy should be your number one priority. Without knowing the requirements and goals of stakeholders, your business will collect too much irrelevant data. Also, deal in advance with questions regarding storage locations, file formats, monitoring of KPIs and which data protection regulations have to be observed.

A goal oriented strategy considered the following aspects:

• Clarify roles and responsibilities in the team
• Consider legal aspects and compliance
• Determine measures and methods
• Set up criteria for external business partners

Find the right data management software

Only use software which suits your business goals. The offer on the market is growing and there are suppliers for different goals. Clear the following questions to find the right data management software:

• What are our business goals?
• What is our budget?
• Which requirements must a software fulfill?
• Does the software fulfill legal requirements?

Consider changes

In the area of data management a lot of things have happened in the past years. There are different software providers on the market, the goals of stakeholders change regularly and customer needs are in an everlasting change. Data management doesn’t only mean to establish purposeful structures once. Instead, targeted processes require regular optimization to ensure long-term results. 

10 best practices for data management

• Weighing costs and benefits
• Know your business goals
• Use databases which fulfill the requirements of your business
• Centralize communication of involved parties
• Teach your staff
• Inform stakeholders and work transparently
• Use data discovery to track processes and ensure good compliance
• Act purposefully but thoughtfully when optimizing processes
• Don’t only think of business processes but also about the effect on your customers
• Don’t get lost in numbers but orient yourself on the wishes and desires of your target audience

Conclusion: Data are digital gold

Targeted data management ensures transparency, process optimization and cost savings. First, you need to clarify questions regarding software suppliers and responsibilities. Data management is a business process, a good strategy is therefore the fundament for a successful implementation.

Software and hardware – two terms which are often mentioned regarding IT and digitalization. But what do they mean and what are the differences?

In this article:

1. Hardware and software: Differences and connections
2. What is software?
3. The different types of software
4. What is hardware?
5. What is the difference between hardware and software?
6. The difference between hardware and software through the example of digital signage solutions
7. What are the challenges of hardware and software?
8. Conclusion

Hardware and software: Differences and connections

The progress in software development is especially helpful for app founder teams | © Austin Distel

The advance of digital techniques establishes new terms. To be honest, “software” and “hardware” aren’t really new and have already been established in the language use about two decades ago but these terms come with several questions to answer. In the following article we will answer questions regarding hardware, software and their differences as well as future challenges.

What is software?

Most people associate the term “software” with computers and this isn’t particularly wrong. But actually, software is a general term for all executable programs and their associated data. In many cases, software describes a script which on the other hand describes the functions and usage of a software controlled device.

The different types of software

The question regarding the definition also comes with the question if there are different types of software. Short answer: Yes, there is, many actually. Following, we will take a closer look at the different types of software.

Open Source

Open source is a free to use software. The source of this type of software is freely accessible and can easily be changed or adjusted. Known examples of open source software is LibreOffice.

Embedded software

Embedded software is a software which is recorded into hardware. The actual danger here is that once software is embedded it is not possible to change it afterwards. Therefore, the software must be flawless. Good example for this type of software are central heating systems – the software is installed within the hardware and functions are predefined. Updates or individual changes aren’t possible afterwards.

Cloud based solutions

The biggest advantage of cloud based software solutions is the independence. Only a few years ago updates and maintenance needed to be done by the business the software was provided for but that has changed thanks to cloud based solutions. Central administration gives businesses the opportunity to be provided with regular updates without having to do them by themselves.

A good example for cloud based software solutions is digital signage – most digital screens are provided with cloud based software. Solutions such as FRAMR make working processes more flexible, individual and centralized. Centralized business processes save a lot of money in the long term and businesses can be sure that processes run reliably in the background and that performance will improve.

Packaged software

It’s probably the most known type of software. Packaged software provides the same solutions for every customer and for every business with only a few changes possible. Good examples are Microsoft Word and Microsoft excel. The actual challenge of these programs is to be compatible with many different systems. Everyone knows the regularly required updates of windows which mostly serve the purpose to fix errors or similar problems – the actual goal is to improve performance but also to make adjustments regarding the compatibility of different operating systems.

The separation of the different types of software can be specified further – often the different types of software are categorized into standardized software, industry software and individual software. Standardized software is often used by many different businesses (bookkeeping software for example), industry software mostly provides solutions for niche businesses (commercial sector for example) and individual software is specifically developed for one or only a few companies.

What is hardware?

Hardware describes the physical components of a computer system and serves as a “tool” for functionality of software. One distinguishes between internal and external hardware. Internal hardware are the invisible components (the inside of a computer for example), external hardware on the other hand are all devices which are outside of a computer.

Examples for internal hardware:

• Processor
• Power Adapter
• Random access memory
• Hard disk
• Drives
• Graphic card

Internal hardware is actually physical as well but not touchable from the outside like external hardware. For example, the hard disk is in the inside of a computer and serves the functionality of the device.

Examples for external hardware:

• Screen
• Printer
• Computer mouse
• Keyboard
• Fax machine

What is the difference between hardware and software?

Software describes the non-physical components and the executable programs of a computer device. Hardware on the other hand helps the functionality of software – hardware itself doesn’t have any impact on the functionality of a program but without hardware it’s not possible or only partly possible to use software. This is where physical components such as computer mouse, screen and keyboard come into play to support the usage of software.

The difference between hardware and software through the example of digital signage solutions

The difference between hardware and software is mostly shown through the example of computers but there are several other devices which are perfect examples of the combined usage of hardware and software. This will give you another perspective and further insights into the topic.

Digital signage software describes the usage of digital-visual screens to display video and picture content in a compact form. Mostly, you will find digital screens in malls. The content is displayed through a central source – therefore it’s usual that screens and programs are not provided by the same supplier because software can be installed into any screen device. A good example of the combination of hardware and software.

But one after the other. How does digital signage work if you consider the differences between hardware and software?

In the first step, software is important to display content on a digital screen. Our different FRAMR players fulfill these requirements because you can save, create and display content through them. It’s a cloud based software solution because maintenance and administration in general are executed through the usage of a cloud. FRAMR players are internal hardware devices at the same time because there are no processors and storage devices within the player itself.

What appears to be complicated at first glance, requires many different working processes and a well qualified team of programmers. The requirements of a good interaction between hardware and software comes with many little steps within the working process and the consideration of high technical standards. Optical elements also play an important role when you display content to make a good user experience possible.

What are the challenges of hardware and software?

The change and progress in fields such as IT also changes the requirements of hardware and software. Especially the  software area comes with many new challenges – the importance of data security increases and B2B customers especially want data secure solutions. But not only are legal aspects to consider, there is also a lot of work to do in technical fields.

Businesses prioritize individuality and flexibility as well as easy to execute working processes. Here, software providers are responsible to offer centralized solutions which consider individual wishes at the same time.

The area of hardware isn’t directly impacted by technical changes. Technical requirements are to consider but even more important are the wishes of consumers and customers. Take screens as example: No business wants to use hardware which is on the technical level of 2015 – it must be modern but also better. The actual challenge lies within usage based elements (User experience, screen definition and easy usage of hardware for example).

Conclusion

The topic of hardware and software is a complicated one, especially because of the changing requirements in IT. There are many different types of software and what businesses want depends on the current events on the market. Currently, cloud based solutions such as digital signage software are highly demanded.

The choice of the right software depends on the goals of a business as well the individual requirements. Cloud based solutions offer the possibility to react fast on changes, packaged software is cheap and individual software solutions precisely fit the wishes and wants of a business (but are mostly much more expensive).

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Digitalization of businesses comes with less known advantages which have a huge impact. FRAMR. presents the seven most important ones.

In this article:

1. Digitalization: Too many businesses miss the trend
2. Why digitization for businesses is important
3. The advantages of business digitization
4. Advantages for your cients
5. This is how the implementation succeeds
6. Are there any disadvantages and risks of business digitization?
7. Conclusion
8. FAQ

Digitalization: Too many businesses miss the trend

The digital transformation is advancing, but not all companies are successfully following suit. In a way, that’s understandable, because the switch to digital processes doesn’t happen overnight. Nonetheless, small and medium-sized companies in particular are missing out on opportunities if they sleep through current trends and fail to realign their strategies. 

Before we take a closer look at the benefits of digitization, we examine the current situation and what difficulties exist in the digital restructuring of corporate processes. Finally, we also look at possible disadvantages to give a better overall view of the topic.

First, an important message: Don’t think too complicatedly when it comes to digitization. Every company goes through the journey of expanding digital processes, be it in internal communications or in advertising. It’s not just about the big steps, whereby an analog company suddenly transforms into a tech giant. The following therefore does not resemble a manual in the direction of “How do I use less paper in the company”, but rather relates to the digitization of internal processes (e.g. marketing and recruitment).

Mobility and social media are two main advantages of the digital progress | © NordWood Themes

The advantages of digitization in companies are well known to many. Thanks to technological progress, there are financial savings opportunities, companies generate more sustainably and offer their customers flexible solutions. Difficulties often arise during implementation – that’s why we have prepared the following tips to pave the way for the digitization of your company and to better prepare you for implementation measures.

Why digitization for businesses is important

Even though digitization is making progress in companies, the processes and competences still have room for improvement. A statistic published on February 14, 2022 shows that 35 percent of German companies consider themselves to be digitalization pioneers and, in turn, 44 percent state that they have increased their sales through digital measures.* Progress is therefore discernible, but there is still a lot of potential to be exploited. Other countries, especially the USA, are much more advanced and are already using digital technologies that are not yet used in the DACH region or are used to a lesser extent. AI products are a good example of this.

The real challenge lies in the lack of a doer mentality. Entrepreneurship already faces various hurdles (e.g., financial or bureaucratic) and processes for digitization do not improve the situation: the first step requires external consultants or the expansion of internal personnel structures. Then comes strategy development, which requires countless consultations within the team. The next step is implementation, which involves a high financial investment.
The thought of this process alone prevents many companies from taking the necessary steps and implementing digital measures.

However, this is no reason to stop or even rethink the change, because digital measures are gradually replacing analog processes. A good example of this is marketing: fewer and fewer companies are relying on print media, but instead on websites, search engine optimization and social media. Online processes are in fact easier to measure and thus enable more efficient use of available resources. However, only a few companies have the ability to implement various online marketing measures at the same time. But there are hardly any disadvantages to this, because even if a company focuses exclusively on search engine optimization, it is already reaping the benefits, even though other measures (e.g., social media) are not yet taking effect.

Therefore, our tip: Digitize your business processes step by step and don’t restructure everything overnight. This minimizes the effort and ensures a proportionate cost structure.

7 underestimated advantages of business digitization

Which advantages do digitized businesses have besides more flexibility, expandation of mobility and a more efficient use of resources? Many businesses ask questions like this and we anticipate it right away: Setting long term goals is the most important factor.

The advantages of digitalization in businesses are the following:

• Digitalization encourages competition and innovative ways of competing with others
• Better service for customers is provided
• Obtaining new employees easier
• Expanding communication structures
• Creating new jobs
• Easy measurement of processes
• Potential of optimizing processes
• Saving money

Digitalization encourages competition and innovative ways of competing with others

Growing competition requires constant rethinking of one’s own offering and customer communication. Right from the start, companies ask themselves to what extent their products or services set them apart from competitors and position them in relation to their target group. And the digital transformation offers additional opportunities to expand internal processes in order to constantly improve the offering and strengthen the company’s own brand.

Here, competition enables some opportunities; after all, competitors are also recognizing the benefits of digitization and optimizing their processes based on the adapting desires of the target group. But what initially appears to be a disadvantage actually promotes your company, because in a constantly growing market with a lot of competition, you are in a position to stay on the ball and offer something new. And because of the competition, there is no standstill, which constantly creates room for more innovation on the market.

Better service for customers is provided

The centralization of work processes ensures that companies can provide their customers with better service. A good example of this is the area of digital signage – thanks to the centralized, cloud-based solution approach, maintenance work is carried out holistically and not every customer is looked after individually, at least in the case of cloud hosting. This saves personnel and financial resources, and the centralized service guarantees long-term functionality. The latter also has a positive effect on customer satisfaction.

Obtaining new employees easier

Posting a vacancy, waiting for applications, and going through a long selection process – that’s what recruitment looked like for a long time, and it’s still common practice at many companies in 2022. In the course of digitalization, however, this changed and companies are finding it easier to obtain personnel, especially through social media channels such as LinkedIn or Xing.
Especially smaller start-ups and founding teams take advantage of this, because freelancer portals enable uncomplicated as well as flexible placement of orders without permanent personnel commitment. Due to the remote work (home office) of the freelancers, no additional office space is required and this saves costs.

Home Office: Remote work is one of the biggest advantages of digitalization | © Austin Poon

Creating new jobs

With digitization, many companies are pursuing the goal of expanding analog work steps as best they can through the use of modern technologies in order to preserve existing jobs. Since then, however, the digital transformation has also seen the emergence of many new occupational fields, especially in the areas of IT and digital marketing. Existing jobs are gaining additional relevance (e.g., web design) and more analog fields are undergoing a digital transformation (e.g., designers for print who now design digital media)

Easy measurement of processes

This advantage is particularly evident in digital marketing. Key figures such as reach and click-through rate can be easily accessed and provide precise insights into the success of the measures taken. Tools such as Google Analytics or the insights on social media channels such as Facebook or Instagram are particularly helpful here. But it is not only in marketing that companies benefit from better measurability, because every digital process is based on evaluable key figures.
In our blog article “What is monitoring?” we explain the advantages of process monitoring in companies and which software is available to you for this purpose.

Potential of optimizing processes

Every process goes through a test phase and it is initially uncertain whether something works or not. But it is precisely the measurability of digital processes that offers optimization potential, because it is immediately apparent from the figures whether an established measure promises the desired success.

Here again, digital advertising is a suitable example. Facebook ads or Google Ads not only promise a lot of reach and more leads, the evaluation of the data also provides information about which approaches or which type of ads perform best. This in turn enables efficient and targeted use of available resources, resulting in exponential growth.

Saving money

Let’s stay with the example of digital advertising: Optimizing digital advertising, be it in terms of content or strategy, saves resources in the long run and for the future you know which advertising measures to consider and which not. This permanent optimization process provides immense financial savings over the years and also gives you the opportunity to learn more about the interests as well as needs of your target group – a win-in situation, because you save money and at the same time you target your marketing more specifically to potential customers, which increases sales in your company.

Note: Our examples mainly considered marketing, but other business areas also benefit from the advantages mentioned so far. Whether it’s human resources, logistics, marketing or production, the benefits of digitization for companies exist across divisions and industries.

Summary of advantages

The greatest advantage comes from the long-term optimization of internal company processes. Initially, digitization in the company requires financial investments and targeted planning, but this process is worthwhile because you gain better insights into the result structure and recognize potential that is denied you with analog methods.

Advantages for your clients

• Shorter delivery times
• Faster communication
• Better information exchange (e.g. through a FAQ section)
• Lower product costs
• Targeted interaction (e.g. through gamification)
• Improved user experience

This is how the implementation succeeds

The good news is that establishing digital work processes does not require any serious structural changes in the company. Instead, you analyze existing processes and define measures for digitization. We recommend selecting individual areas and developing a strategy for each subarea.
Example: As a team, you decide to optimize your company’s website for search engines and, at the same time, you commission the development of an app. Here, it is less important which step you focus on first, but rather which strategy you define for the individual steps, i.e. search engine optimization and app development.

FRAMR: DIVE INTO A DIGITAL AND INTUITIVE WORLD

Looking for a way to better target customers and digitize your marketing? FRAMR. products pave the way for you! Digital signage promotes communication with your customers and you respond to their needs in a targeted manner. In addition, you gain significant competitive advantages thanks to a better user experience and a lot of “wow effects”.
You are not convinced yet? Then get a detailed overview of the advantages HERE! You can also try our FREE trial version to experience FRAMR in action. Spoiler alert: You’re guaranteed to be thrilled, and for a monthly subscription cost of just €6.90!

Are there any disadvantages and risks of business digitization?

Digital transformation promises a wide range of benefits, but some are still skeptical. Many criticize, for example, that jobs are at risk as a result of digitization. Others, in turn, see the financial outlay as a major hurdle.

It is a misconception to claim that digitized work processes will lead to job losses, because some professions downright require retraining to learn new skills. A good example is the profession of architect – ten to 20 years ago, houses were created on paper, now they are created with digital programs. And thanks to continuing education, even architects trained in the 1990s know how to use modern software.

The objection that digitization requires high investments is also not entirely correct. It is true that in marketing, for example, many test phases are required to assess the success of an advertising measure, and content marketing in particular is known to involve a high investment of time as well as money. However, it should not go unmentioned that such investments are worthwhile in most cases and the average return on investment in content marketing is four percent*. This means that the supposed disadvantage turns into an advantage in the long term.

Conclusion: Advantages of business digitization outdo the disadvantages

Digital business processes will be indispensable in 2023. The advantages of digitization range from increased flexibility to expansion of competition. Many see the digital transformation as a threat to jobs, but it is precisely the basic innovative idea that will create further opportunities in the future to combine analog workforce with modern technology. Business areas such as marketing are already showing the added value that the implementation of digital strategies offers companies, not to mention the opportunities to use resources more efficiently and evaluate results more accurately.

FAQ

Below we will answer the most frequently asked questions about digitalization of businesses.

What does digitalization mean for businesses?

The goal of businesses is to create more independent as well as more flexible working processes. That results in long term cost savings, more efficient usage of resources and progress in the development of products and services.

Why is digitization important for businesses?

Digitalization saves money and processes become more sustainable. Other advantages are obtaining new employees, easier measurement of the usage of resources and expanding sales ways.

*Source: https://de.statista.com/themen/6129/digitalisierung-der-arbeit/#topicHeader__wrapper

Pictures: © Canva.com

In this article you will find out more about cloud based solutions and how b2b businesses take advantage of them.

In this article:

1. Cloud based solutions B2B: Digital signage and more
2. Cloud computing simply explained
3. Cloud computing and the advantages for businesses
4. Cloud server digital signage
5. How safe are cloud services?
6. Conclusion
7. FAQ

Cloud based solutions B2B: Digital signage and more

Digitalization makes businesses rethink their working processes and also more flexible as well as adaptive. Cloud based solutions for businesses offer many advantages and strengthen the position of a company against its competitors.

Cloud solutions: location independent usage – even worldwide | © NASA

Cloud computing simply explained

The term “cloud” is defined in many different ways. Most people see it as a way to get access to content without a required internet connection. Others point out the advantage that no storage space is needed. Simply explained, cloud based solutions give the possibility to location independently save data as well as to be able to get access to them location independently.

Many people associate cloud based solutions with services such as Google Drive but the possible applications go further. Cloud based solutions even offer a location independently application, best example: Digital signage software. The cloud based usage of digital signage pursues the goal that businesses can display video and picture content without an internet connection. Other than that, businesses take advantage of provided servers. The storage of data is a good usage as well but the main advantage lies within the uncomplicated access to content and to show it to potential customers. Therefore, cloud based solutions not only offer a good way to save data but also to overcome communication boundaries with customers.

Cloud computing and the advantages for businesses

Switching to cloud based solutions means that businesses are given more advantages in the process of using and providing digital signage solutions. As the possibilities are not exclusively limited to save data, there are also advantages regarding costs and hosting.

Better organization and more flexibility

Cloud based solutions B2B provide a flexible as well as uncomplicated execution of applications within a service. The centralized data saving offers more safety when it comes to technical problems and is followed with fixing them fast thanks to the hosting service.

Save data storage

Worries regarding the safety of cloud computing are unjustified when you rely on a serious provider. Data management happens over a professional protected data center.

Competition advantages and focus on competences

Cloud computing means to automate processes and that makes it easier to implement further processes or new applications. That comes with advantages in competition with others and the automated processes enable a better focus on the core business. 

Flexible display of media

Cloud based solutions offer more flexibility, especially for digital signage software. Once the content is created, displaying it can easily be done with the help of cloud based solutions.

Less costs

More flexibility, less costs for human resources and uncomplicated possibilities to adapt come with less costs.

Breakdown safety

Cloud based solutions require maintenance work on a regular basis and meet high safety standards. The sudden loss of important data is therefore almost impossible to happen.

Cloud based solutions B2B not only come with advantages regarding flexibility in data saving but optimize the whole working process of a company. Businesses save money, centralize working processes and come with benefits in competition with others.

Cloud server digital signage

Cloud based solutions for businesses are diverse and are available in many different fields. With digital signage software it’s also possible to use a cloud and display content easily. Through the central data saving, you have access to content every time you need it and you get your own individual access for registration.

Thanks to cloud based digital signage solutions you won’t have to pay for establishing your own server and important updates as well as maintenance are done by the hoster. Because of that, maximum safety is provided and your focus is on the core business of your company.

That comes with the possibility to provide cheap license and subscription models. Your own server and maintenance work are expensive – often, unexpected problems occur and you have to pay even more. Cloud solutions for digital signage businesses create a clear cost structure to good conditions.

FRAMR. EASY AND INTUITIVE DIGITAL SIGNAGE SOLUTION

Show digital media content on common displays like consumer or professional screens or even LED walls! That’s simple digital signage, and that’s how we support your work with FRAMR. The answer for easy and intuitive management and presentation of media content.

FRAMR uses its own and safe cloud, based in the European union. It is supported by a connected Content Delivery Network (CDN) for safe delivery. We provide maintenance work and offer central data saving in exchange for fair subscription prizes. Our products connect with different devices and come with many advantages, starting from the amount of data you can save within the cloud to high quality resolution and powerful processors. Oor products are all GDPR compliant.

Recommended reading → 7 underestimated advantages of business digitalization

How safe are cloud devices?

Many people argue that cloud based solutions aren’t safe when it comes to protecting data but you don’t have to worry about it. The communication between internet service and local disk is cryptic. Therefore, it’s safe from hackers. Other than that, cloud based solutions mostly require passwords which provides more safety.

But there is no guarantee that you won’t lose your data. Weaknesses in programming may lead to the loss of data and average saved registrations might leave hackers a chance for a strike. Many people can’t figure out how safe cloud services are and that makes them worried the most – especially because cloud based solutions offer such good services makes people worried that something unknown might cause a bigger problem.

How safe is FRAMR?

When using FRAMR, you won’t have to worry about such problems. Our cloud system provides safe data administration and hosting as well as crypting working processes to prevent hacker strikes. We are responsible and want to offer safe solutions as well as we hold up to standards as we regularly finish required updates and do the maintenance work for you.

Conclusion

Cloud based solutions for businesses are an important factor in competing with others. Providers have many advantages because it makes organization easier and investing for server hardware is not necessary. But even consumers have advantages because being local independently as well as not being dependent on an internet connection provides the easy and uncomplicated service potential customers want.

FAQ

Below we answer some of the most frequently asked questions about cloud based solutions.

What is cloud storage?

Cloud storage is a computing model which saves data in a logical pool (cloud). That gives the possibility to get access to saved data without having to have an internet connection.

How safe are cloud services?

Data in a cloud is safe because the communication between server and local disk is cryptic. Unwarranted access is not possible because of safety standards and password requirements.

What is resource pooling?

Resource pooling describes the process in which providers of cloud software give many users access to their server.

When is a cloud based solution GDPR compliant?

Centralized data saving is GDPR compliant when users accept the terms of services and allow the processing of personal data.

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