Moving Digital Transformation Forward

Moving digital
transformation
forward
The research
OVER Survey of business executives, managers, and
analysts from organizations globally to understand
3,700 how the digital enterprise is evolving
Respondents were
34% 66% 131 27 VARIOUS

United States other countries industries org sizes
15 Executives & subject

matter specialists
Feature report
to be published JULY 2016
Source: 2016 MIT SMR and Deloitte Digital business research 2016 Deloitte Development LLC. All rights reserved.
We asked imagine an ideal organization
transformed by digital technologies
respondents to: and capabilities that improve
processes, engage talent across the
organization and drive new value-
generating business models.
We then asked rate their company against that ideal

on a scale of 1 to 10. Three maturity
them to: groups were observed, early (1-3),
developing (4-6), and maturing (7-10).
The results:
Digital
maturity
needs INTERNAL OBSTACLES
ARE THE BIGGEST
cultivation REASON COMPANIES
and vision FALL BEHIND.
2016 Deloitte Development LLC. All rights reserved.
Digitally maturing
organizations typically
experiment rapidly, take
risks, invest in their own
talent, and value soft skills
in leaders more than
technology expertise.
Most organizations are still
striving to reach maturing level
Organization digital maturity
(on a scale of 110)
of respondents believe
digital technologies will
disrupt their industry
feel their organizations are

adequately preparing for
disruptions projected to occur in
their industry due to digital trends
Many business leaders
still believe that if your
product exists in the
physical world, you can't
be digitally disrupted.
Arun Sundararajan, professor of business at New York
University and author of The Sharing Economy
Thats the wrong attitude. Any
responsible company today should
view digital technologies as a means
to create a more efficient
organization or a different form of
customer engagement, irrespective
of how physical the product may be.
Arun Sundararajan, professor of business at New York

University and author of The Sharing Economy
WAIT...WHERES
Talent EVERYONE GOING?
Maturing companies develop from within.

People who arent getting digital
opportunities may leave.
Talent gap is acute, and may grow
MY ORGANIZATIONS
Respondents
EMBRACE OF DIGITAL
ATTRACTS NEW TALENT
(% of respondents
agree/strongly agree)
MY ORGANIZATION NEEDS
NEW TALENT TO COMPETE
IN THE DIGITAL ECONOMY
(% of respondents
agree/strongly agree)
Organizational
Digital Maturity
and the war for digital talent is
heating up; talent may take flight
% who plan to leave their
company in less than one
year given digital trends:
6 TIMES
as many VP
level leaders at
risk of leaving in
1 YEAR
CORPORATE DIGITAL
Culture CULTURE MATTERSA LOT.
Motivating cultural traits are shared

across maturing companies.
Digitally maturing
organizations adhere to a
distinct culture mindset
In-house talent MATURING & DEVELOPING
becomes critical as COMPANIES TEND TO FIRST
you mature LOOK INSIDE, NOT OUT
How is your organization primarily
strengthening digital innovation capabilities?
Hire Contractors/
1. Consultants
Develop Employees Develop Employees
2. Don't know External Relationships Recruit Digital Employees
Hire Contractors/
3. External Relationships
Consultants
External Relationships
4. Develop Employees Recruit Digital Employees Recruit Digital Leaders
Digitally maturing companies
are consistent in how they
work across the enterprise
ORGANIZATIONAL CONGRUENCE
CULTURE
INPUTS STRATEGY TASKS STRUCTURE OUTPUTS
PEOPLE
Continuous feedback;
learning and adapting
Based on concepts from A Model for Diagnosing Organizational Behavior,

David Nadler, Michael Tushman, American Management Association. 2016 Deloitte Development LLC. All rights reserved.
STEADY AT
Leadership THE HELM
Leaders with vision are critical

to driving digital changes.
Leadership requirements dont change
TRANSFORMATIVE
VISION 22% 20% FORWARD
LOOKING
CHANGE
ORIENTED 18% 18% TECHNOLOGY
UNDERSTANDING
REGARDLESS OF MATURITY LEVEL, A RANGE OF SKILLS ARE VALUED

Effective change
management is
imperative to making
the transformation
from doing digital
to being digital.
WHERE DO YOU
Strategy GO FROM HERE?
Take a long-term view.

Longer than that.
No, even longer.
Time frames greater than
10 years may be needed in
a digital environment.
John Hagel, co-chairman of the Center for the Edge at Deloitte
Digital strategies are evolving
Companys digital maturity level:
My companys digital strategy is
81% 86%
64%
54% 52%
46%
38% 34%
23%
Clear and coherent Integrated into overall Forward looking

company strategy (2 years or greater)
BUT DIGITAL STRATEGIES EVEN FOR MATURING COMPANIES MAY NOT LOOK LONG ENOUGH INTO THE FUTURE.
Silicon Valley companies follow a
Zoom Out and Zoom In approach:
Consider Address the next
time horizon by defining and identify the two or

what the market will three business initiatives
likely look like and what that will have the greatest
customers will expect. potential to accelerate
movement toward the
longer-term destination.
To read the full report, visit
sloanreview.mit.edu/digital2016
To understand the challenges and opportunities

associated with the use of social and digital
business, MIT Sloan Management Review, in
collaboration with Deloitte*, conducted a fifth
annual survey of over 3,700 business executives,
managers, and analysts from organizations
around the world.
*As used in this document, Deloitte means Deloitte Consulting LLP and Deloitte Services LP, which are separate subsidiaries of Deloitte LLP.
Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services
may not available to attest clients under the rules and regulations of public accounting.
Deloitte University Press |Aligning the Organization for Its Digital Future @DU_Press @DeloitteDigital @MITSMR #digitalevolution

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Moving digital

34% 66% 131 27 VARIOUS

15 Executives & subject

We then asked rate their company against that ideal

feel their organizations are

Arun Sundararajan, professor of business at New York

Maturing companies develop from within.

Motivating cultural traits are shared

2. Don't know External Relationships Recruit Digital Employees

4. Develop Employees Recruit Digital Employees Recruit Digital Leaders

INPUTS STRATEGY TASKS STRUCTURE OUTPUTS

Based on concepts from A Model for Diagnosing Organizational Behavior,

Leaders with vision are critical

REGARDLESS OF MATURITY LEVEL, A RANGE OF SKILLS ARE VALUED

Take a long-term view.

My companys digital strategy is

Clear and coherent Integrated into overall Forward looking

time horizon by defining and identify the two or

To understand the challenges and opportunities

2016 Deloitte Development LLC. All rights reserved.

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