The Impact of Digitization

Data digitization makes the storage and transmission of data easier and more cost effective. Some data starts

out as digital data, such as that from a Microsoft Suite product. The Excel files and Word documents we create

are ubiquitous and easily stored and transmitted. Cloud storage and video conferencing are now the norm.

Emails and Zoom meetings are quick, easy, and inexpensive ways to share and store information. Businesses

now create an e-trail, or virtual paper trail, to document, verify, and share processes. Because data is now

much easier to access, firms bear the added responsibility of ensuring that it is stored and secured properly so

that individuals cannot inappropriately alter or delete information.

Data storage has changed significantly in the last decade as companies have moved the storage of digital data

to the cloud. The advantages include only paying for the storage actually used, reduced energy consumption,

access to specialized data protection services, and software and hardware maintenance. However, the risk of

data hacks and the safety of data are key concerns in the storage of digitized information.

Uses of Data

Taken together and separately, the internally generated financial statements can provide managers with a

wealth of information to enable superior decision-making. Harvard Business School identifies six ways

managers can use financial statements.3

1. Measuring the impact of business decisions such as new software, marketing plan, or product line

2. Aiding in the development of budgets by creating a starting point for future expectations

3. Aiding in cost cutting or the reduction of duplicate activities

4. Providing data-supported strategic planning and visioning

5. Ensuring consistent data and content across departments

6. Motivating teams to set, meet, and exceed goals and objectives