A Digital Organization Combines Digital Capability with Digital Dexterity
In prior research, we showcased how digital leaders are using investments in digital technologies to transform key capabilities across customer experience and operations. However, in today’s volatile and disrupted world, capability leadership is not enough. As well as having the capabilities in place, organizations need to be nimble and flexible – dexterous – if they are to respond to ever-changing technology advances, emerging competitive disruptions, and changing customer needs. Enterprises that excel in both qualities – capability and dexterity – are digital organizations. This ‘digital elite’ reported that they outperformed their competitors on multiple key performance indicators including profitability, customer satisfaction, innovativeness and growth.
The report, the latest in a series analyzing the opportunities and challenges presented by digital transformation, is based on 31 interviews and a survey of 274 industry executives, representing 150 different enterprises across 28 countries. It uncovers five key attributes that set the most digitally dexterous organizations apart from others:
- Establishing partnerships – The digital elite not only understand the importance of outside expertise in digital initiatives but are able to quickly establish partnerships
- Identifying and deploying internal expertise – The ability to find and utilize the best, most relevant expertise regardless of where it resides within an organization
- Response to customers’ individual needs and preferences – Have embraced digital as a tool to zero in on and respond to individual customers needs
- Detection of emerging trends – Have a finger on the pulse of the new technologies, business models and market changes being driven by digital
- Ability to self-organize quickly – Can quickly bring together its organization around new digital initiatives or opportunities
Organizations are showing varying degrees of building this dexterity in to their design:
- A small cadre (7%) of leading organizations exhibit a digital-first and dexterous mindset; they have digitized operations at company-scale, are able to quickly self-organize and create partnerships around new digital initiatives and hold significant experience and skills in digital technologies.
- The majority of companies are embarked on a path towards digital capability and dexterity, with many (56%) ‘initiating’ and just starting the shift, while a significant number (21%) are ‘engaging’ and well underway with transition, with various digital capabilities in personalizing customer experience, simplifying routine tasks and enabling collaboration within and beyond an organization’s boundaries
- 16% of organizations are ‘stalling’, without any significant digital capability and grappling with its possibilities, inflexible and unable to respond to emerging trends and customer needs.
The research outlines the key issues for organizations as they progress towards digital dexterity and provides a blueprint of the ideal digital organization, including a guide encompassing the mindset, practices, talent, and data and tools required. It also provides an interactive self-assessment tool to evaluate the digital maturity of an organization and understand how it ranks from beginner to accomplished performer.
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