In the age of digital disruption, traditional ways of creating sustainable competitive advantage are no longer effective. The adoption of the new suite of digital technologies including social, mobile, cloud, data analytics is the new competitive imperative for success. Simply put, if you don’t significantly improve your organization’s digital acumen your competitive viability is at risk.
Most companies are lagging in adopting digital technologies
This year’s Harvey Nash/KPMG Survey of 4500 technology leaders found that only 18 percent said their company was effectively using digital technologies to advance their business strategy.
The 2017 New Rules for the Digital Age report from Deloitte found that only 5 percent of the companies surveyed said they have strong digital leadership development programs and 65 percent said that had no significant programs to drive digital leadership skills.
The chart below highlights the breadth, scope and impact of these new disruptive digital technologies:
Bridge the digital technology gap
In order to improve your organization’s digital acumen, you have to get very good a leveraging digital technologies’ to:
- Mine and interpret multiple data sources to make critical business decisions faster and more accurately
- Optimize underlying business processes and functionality and convert them to digital processes
- Anticipate what you need to do to deliver the ultimate customer engagement digital experiences
- Provide your employees with digital workflow tools and resources to make them more productive and effective
- Establish your brand as a pioneer in the new digital frontier
Identify what you need to learn to become a digital technology savvy organization
Many companies today don’t have any formal process or initiative in place to expand their knowledge and understanding of the competitive impact digital technologies can have on their businesses. As such, they are often caught off-guard by these disruptive changes and find themselves scrambling for survival.
Here are some ideas to consider to avoid this situation:
- The CEO should engage the C-suite and the Board in a series of discussions to agree upon the appropriate digital transformation strategy for the company and the plan to implement it.
- Establish a digital technology learning network comprised of internal and external resources that can facilitate ongoing dialogues about when and how these technologies can impact your company’s performance.
- Conduct periodic briefings and workshops for the Board, C-Suite, Operating Units and Functional Support Groups to introduce and socialize specific digital technology initiatives and programs.
Build a digital acumen roadmap
Most successful transformational journeys start with a concise well documented roadmap that highlights the desired outcomes and a timeline for critical deliverables. I think the core framing questions for this digital transformation roadmap are:
- How does our company become a digital enterprise without compromising our customer relationships, our brand value proposition and our employees’ well-being?
- How does our company look and operate as a digital enterprise?
- How open is our culture to changing the way we do business?
Assemble a cross-functional digital transformation team
Once you’ve agreed to the digital strategy, you can then put together a dedicated cross-functional team to develop the roadmap and implementation plan. Unlike most planning exercises, this work cannot be done within vertical functional silos but rather must draw upon a diverse set of skills from across the entire organization. A study conducted by MIT and Deloitte found that 70% of digitally mature companies are organized around cross-functional teams versus just 28% for companies in the early stages of digital development.
To be clear, this work is not about improving the last best version of your old business model, it’s about creating the first best version of your new business model.
The good news is that you don’t have to do everything at once. You can and should identify specific parts of your business that present the best opportunities to conduct a series of pilot experiments where you can learn fast and make changes based on actual customer actions.
Here are some questions to start that process:
- What part of our business has the highest competitive risk from a digital technology disruption?
- What do we need to do to mitigate this competitive risk?
- What resources can we redirect away from our current businesses to develop and launch a digital business?
Clearly a transformative change of this scope and magnitude is not undertaken lightly and requires:
- The desire and resolve to explore new ways of doing business and letting go of the old ways of doing business.
- Being willing to assemble a digital learning ecosystem of resources from both within and outside your organization.
- A commitment to building a culture of continuous learning and experimentation.
- Making increasing digital acumen a formal leadership competency for hiring and promotions.
- Complete alignment and support for the new digital game plan from the Board all the way through the entire organization.
I have had the opportunity to work with several CIOs and their C-Suite colleagues on this issue and seen first-hand the benefits increasing digital acumen can bring to any organization. As such, if you are thinking about tackling these issues within your company, please reach out to me as I would be happy to share the approach we’ve taken and the results we’ve achieved.
As always, I am interested in your comments, feedback and perspectives on the ideas put forth in this blog. Please e-mail them to me at email@example.com.