One of the questions clients ask is how they prepare for the digital transformation of their business. In some cases, the businesses are completely digital and the answers are much easier. For legacy businesses, however, the changes are often slow and painful, if they happen at all.
The folks at the MIT Sloan Management Review and Deloitte Digital released the fifth annual Digital Business Study. Called“Aligning the Organization for Its Digital Future, it presents an increasingly wide gap between the companies that have transitioned successfully to the digital world and those who are struggling to do so.
The report found that digitally maturing companies have organizational cultures that share common features, including an expanded appetite for risk, rapid experimentation, heavy investment in talent and recruiting, and the development of leaders who excel at soft skills. It also examined the different types of companies with respect to their digital transformation:
Additional analysis of this year’s study found three distinct cultural mindsets that relate closely to corporate stages of digital maturity. Some characteristics include:
- Low appetite for risk– This mindset is common among early stage digital organizations. In addition to being risk adverse, early stage companies tend to have a hierarchical leadership structure, conduct work in silos, and make decisions based more on instinct rather than hard data.
- Experimentation and speed– Conversely, digitally maturing companies value experimentation and speed, embrace risk, and create distributed leadership structures.
- Collaboration– Digitally maturing companies also foster collaboration and are more likely to use data in decision making.
Nearly 80 percent of respondents surveyed from digitally maturing entities indicate their companies are actively engaged in initiatives that bolster risk taking, agility and collaboration. For early stage companies, the number falls to 23 percent.
Finally, they found that nearly 90 percent of digitally maturing organizations are integrating their digital strategies with their companies’ overall strategies. In other words, digital is not something that’s “tacked on” or just another channel.
Where do you fit in the spectrum? Do you have the skills – having a transformative vision, being a forward thinker, having a change-oriented mindset – the study found are critical for a successful transformation? How are you putting them to work?