A key to any organization’s survival of the ongoing digital reformation will be their ability to break free from the deeply ingrained thinking in terms of atoms and start thinking in bits.

I first came across the idea of thinking in bits in Nicholas Negroponte‘s 1995 book Being digital. In the book, Negroponte talks about the limitations, the cost, of moving information around as atoms – paper books, CDs, DVDs, snail mail, you get the idea – and how information would soon be converted from atoms to bits. The immediately obvious implication is that it now becomes essentially free to move and share information as bits.

The less obvious, but much more important, implication is that bits change the way you can think about the information. How you can manipulate and repurpose the information. How you can do things that were impossible with the information locked up in atoms. The obvious applications have come to fruition. Email instead of snail mail. Music downloads instead of CDs, and now streaming instead of downloads. The same with video.

And yet…

And yet, the way this digitized information, these bits, is handled is still in many ways tied to the way atoms were handled. The medium has changed, but the process remains the same. Some of this, such as in the music and movie industries, is purely for commercial reasons. They are shipping in bits, but they are not thinking in bits.

Even from a creative perspective, as opposed to the commercial, this thinking in atoms prevents many from seeing new possibilities for providing engaging and individual experiences to their customers. For example, consider how labels distribute music, how they release the same tracks in the same order on both CD and on services like iTunes or Google Play. This is thinking in atoms at its finest (worst?).

Imagine if they were thinking in bits instead. They could offer an “album” that includes songs from the setlist the band played in your town, or edit the songs at the disc-breaks on multi-disc albums so they didn’t fade out / fade in. For individual song downloads from live recordings they could edit the track so you didn’t catch the introduction to the next song at the end of the song you’re listening too.

The same is true, albeit for different reasons, inside many organizations. Yes, nearly everything is in bits, stored on shared drives, in Sharepoint or email, on an enterprise social network or whatever system your organization uses to “manage” content.

And yet….

And yet most of these bits are locked up in mere digital representations of atoms. Again, working in bits but not thinking in bits.

Of course, 20+ years after Being Digital things have changed quite a bit. Many companies have leveraged thinking in bits to their advantage. Tax preparation software companies come to mind: the process of collecting the necessary information is designed to meet the needs of the person entering the information while the output of the information is in the format (atom-based) necessary for submission to the appropriate agencies. (Sadly, my guess is that those agencies still have atom-based processes to actually handle the information.)

And technology has evolved radically. Blockchain comes to mind. But even there, in a highly thinking in bits based process of transactions, most people’s attention is drawn to the most atom-based aspect of the blockchain – it’s use as a currency.

Digital transformation is not, as some people think, something you do. It is, rather, something that is happening, something that is happening to you. Whether you want it to or not. Thinking in bits is your key to not just surviving the transformation, but to leading the way.