The digital reinvention revolution is upon us. In fact, the train has long left the station. Along its journey, flocks of consumers and businesses have boarded. Digital is as ubiquitous as air. Or is it?
Reality is, different industries are at different points of their digital journey. Some are far down the tracks, whilst others are still waiting at the platform.
According to research by McKinsey & Company, on average industries are less than 40% digitised. While it is true to say that every industry has some degree of digital penetration, it is clearly occurring at vastly different speeds.
So which industries are embracing digital reinvention and which ones are hitting the buffers?
Industries leading the charge:
- Media and entertainment (62%)
- Retail (55%)
- High Tech (54%)
Industries falling behind:
- Consumer packaged goods (31%)
Automotive and Assembly (32%)
Financial Services (39%)
Why are businesses failing to digitally reinvent?
Enduring businesses perpetually reinvent themselves. This is particularly the case when it comes to digital. Why is it then that a number of key industries continue to fall behind?
Well, according to McKinsey, a failure to see return on investment is a big digital deterrent. A deeper delve though, suggests the real problem is often the manner of investment.
Some businesses, for instance, have been investing too much in the wrong areas. On the other hand, some invest too little in the right areas.
What do leading companies do differently to the rest?
Digital transformation doesn’t happen by chance. Those businesses successfully reinventing themselves do so by working to a coordinated strategy; they faithfully follow one which cuts across many different tracks.
McKinsey’s research supports this thinking. It posits that those on the forefront of digital reinvention are adopting a number of common practices. These include:
- Ensuring their digital strategy is aligned with their corporate strategy
- Exercising a high level of strategic response to digital change in products, eco-systems, processes and supply chains
- Having a strong organisational culture and avoiding siloed mind-sets and behaviour
- Recruiting talent that will position them strongly for digitisation
- Investing more, more broadly and boldly
Do you choo choose digital reinvention?
The potential effects of full digitisation on economic performance are apparent. A successful transition, however, means strategically aligning your corporate goals against new technologies, solutions, emerging marketings and shifting profit pools.
The research from McKinsey & Company suggests digital is yet to become fully mainstream for the business masses. It is achievable though. Those who embrace digital by taking steps to invest, then re-strategise, can reach their goals.
They board the digital train with care. Mind the gap. And are fully aware that stagnation of technological progression could see them wiped off the track altogether.
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