Beyond Digital

Key insights
from the book
Since the first commercial
internet browser was
created nearly 30 years
ago, “being digital” has
been a business mantra.

2
1 Strategy& | PwC Strategy& | PwC 2
Digitizing existing
processes and systems
Enabling Implementing
people sales pipeline and

has become a requisite,

to work quotation system
remotely Implementing
AI within the
and a costly one, for Upgrading systems
to latest release Implementing business

competitive advantage. Improving

workforce
new supply
chain system Implementing
analytics Upgrading to CRM system
cloud-based
Establishing
systems Upgrading
The shift to “virtual Implementing finance
e-commerce
channel
everything” during HR platform systems
Harmonizing
Automating financial
the pandemic only
data structures
report generation Building data &

accelerated the trend. Implementing

configure, price,
analytics insights

quote platforms
Improving digital
marketing practices

3 Strategy& | PwC Strategy& | PwC 4

 But digitizing what your It’s not even enough to
company has always catch up with the pack.
been doing is no longer
enough to gain a
competitive edge.

5 Strategy& | PwC Strategy& | PwC 6

 capability [keɪpəˈbɪlɪti], noun: a highly integrated and
often complex combination of knowledge, processes,
That’s because the fundamental technologies, data, skills, culture, and organization
models that allows a company to create value in ways

model of value creation that others cannot. The complexity and need for
integration make capabilities hard to replicate,
which is why companies that define themselves through
has changed. what they do rather than what they sell tend to be
distinctive and create lasting advantage.

Revolution of demand
• The internet has given customers access to more
choices and insight into the quality of these
choices.
• Being OK just isn’t good enough any more.

Creating value requires

Revolution of supply
building scale in capabilities
• Value of scale in mass production, distribution, (rather than captive assets)
marketing, and back-office operations has eroded.
and working with ecosystems
• Decline in friction has reduced barriers to
cooperation and enabled ecosystem plays. to address some of the
massive problems the world
needs to resolve.

Transformation of context
• Executives must balance many factors (beyond
profit) when deciding how to create value.
• Stakeholders ask for transparency on ESG impact.
• Global interconnectedness has raised uncertainty
and risk.

7 Strategy& | PwC Strategy& | PwC 8

 The time has come to
move beyond digital.

The time has come

to fundamentally
rethink how
your company
creates value.

9 Strategy& | PwC Strategy& | PwC 10

To understand how, we
researched 12 established
companies that got in front …and transformed themselves
of change… for success in this new world.

Microsoft Cleveland Philips

Clinic

Eli Lilly Hitachi

Inditex
Honeywell
Komatsu
STC
Adobe Titan
Citigroup

Note: The following pages contain highlights from six of these company transformation stories. The
book Beyond Digital: How Great Leaders Transform Their Organizations and Shape the Future by
Paul Leinwand and Mahadeva Matt Mani contains the full set of 12 transformation stories.

11 Strategy& | PwC Strategy& | PwC 12

Our research 1 Reimagine your company’s
place in the world

2
revealed How your
company Embrace and create value via
7 leadership faces the
external
ecosystems

imperatives
3
world
Build a system of privileged
for transforming insights with your customers

your
organization and
shaping the How your
4 Make your organization
outcome-oriented

future.
5
company
sets itself Invert the focus of your
up to create leadership team
fundamental

6
advantage
Reinvent the social contract
with your people
Following them will help

7
secure your company’s
future in the “beyond
How you Disrupt your own leadership
digital” era. lead approach

4 | The Strategy Crisis

13 Strategy& | PwC Strategy& | PwC 14
 Reimagine your
company’s place
in the world

Redefine what problems your company is

here to solve and what differentiating
capabilities are required for that.

15 Strategy& | PwC Strategy& | PwC 16

 Reimagine your company’s place in the world

Companies across sectors need

to reimagine their place in the
world to ensure their relevance
and sustained success.

With the definition of value itself and the model of value creation To reimagine your place in the world, ask
changing, reimagining your place in the world has become a
prerequisite to securing your relevance in the future. yourself these questions and consider
these insights:
Your place in the world
• How is the definition of
= the unique value you promise value changing? Take a point of view
• How are customer about the future
+ the differentiating capabilities needs changing?
needed to deliver that promise • What ultimate value
do the ecosystems you Use your ecosystem to
Both dimensions—the unique value you provide and your
participate in create? widen your aperture
differentiating capabilities—are what defines your company’s
• What are the real needs
place. Focusing on just one of those dimensions isn’t enough.
of the ultimate user?
What your organization does to create value and how it does it
are critical in the “beyond digital” world, where trust and
• What are the incredible
outcomes are not only sought after but increasingly demanded.
things your company is able Find your hidden powers
to do that could offer value
beyond your current products
and services?

• What would you do if you

entered this industry without
Unconstrain your team
the baggage of your legacy?
• How can you shape
your future?

17 Strategy& | PwC Strategy& | PwC 18

 Reimagine your company’s place in the world

Company story: Philips

Founded as a lightbulb manufacturer in 1891, Philips had become
a vast conglomerate selling products ranging from audio and video Philips’s quadruple aim:
consumer electronics to lighting and medical equipment.
In 2011, under the leadership of its new CEO, Philips looked into
the future and realized the need for a fundamental transformation
to compete in a more technology-driven and outcomes-focused Better health Improved staff
world. The company would refocus itself around healthcare and outcomes satisfaction
healthy living and pursue a truly ambitious purpose: “to make the
world healthier and more sustainable, with the goal of improving
the lives of 2.5 billion people a year by 2030.”
Philips would transform into a health technology company Improved
enabling integrated healthcare solutions and services that unlock Lower cost
patient
the power of data and AI at the point of care and optimize delivery of care
experience
across the health continuum, from healthy living and prevention of
illness through diagnosis, treatment, and aftercare. Philips’s new
place in the world drew on research showing the promise of value-
based healthcare to improve outcomes and lower overall costs.
This place in the world allowed Philips to address people’s need to
manage their health in a more integrated way and leverage its
strong capabilities in medical devices, consumer insights, and
technology innovation.
As part of this major transformation, Philips:
• divested or spun off legacy businesses, including lighting, TV,
video, audio, and domestic appliances
• reorganized around customer domains, bringing together
previously siloed teams to create customer outcomes
• built new ecosystem partnerships
• brought in new talent to take technology, data, and software
capabilities to new levels.

Today, Philips’s focus as a health technology player has resulted

in remarkable gains in profitability and shareholder value, with the
stock price rising 82% in the five years ending in 2020.

19 Strategy& | PwC Strategy& | PwC 20

 Embrace and create
value via ecosystems

Collaborate with other organizations to

deliver value propositions no company
could offer by itself, and access
needed capabilities.

21 Strategy& | PwC Strategy& | PwC 22

 Embrace and create value via ecosystems

Companies need to make full

use of ecosystems to offer more
ambitious value propositions
and access needed capabilities.

Many of today’s unresolved problems are so massive and When people hear about ecosystems,
complex that no single company can solve them alone—you
need networks of companies and institutions that work together many think about platforms. But
toward a common purpose. platforms are just one of several flavors:
Given the pace of change, companies need to quickly scale up
capabilities. They don’t have the time or resources to build all Offers a platform and
the required capabilities on their own; they need to work with creates a marketplace
ecosystems to access the capabilities that others have built—at Platform provider
where users can connect
speed, at scale, and flexibly. (e.g., Amazon, Facebook)

Creating value from within your four Enables participants to

walls may have served you well in the Orchestrator collaborate to serve a
broader objective with
past, but it won’t do so going forward. customers (e.g., Komatsu)

The companies we researched shared insights on how to make Assembles or curates

your ecosystem strategy work: related products and services
Integrator
• Determine what role you should play in the ecosystem. into a bundled offering (e.g.,
many hospitals)
• Focus on the value you are creating for the ecosystem—not
just what you’re extracting from it.
Develops breakthrough
• Clearly define what capabilities you contribute to, receive Innovation partnership products by working
from, and deliver together with your ecosystem. across company lines
• Invest in building trust and deep understanding together with (e.g., automotive companies)
your partners.

23 Strategy& | PwC Strategy& | PwC 24

 Embrace and create value via ecosystems

Company story: Komatsu

Japan’s construction industry is facing a massive shortage in
labor. By 2025, according to a projection by the Japan Komatsu’s 3 levels of digitization:
Federation of Construction Contractors, there will be a shortage
of some 1.3 million skilled construction workers.
Step 3: In-depth digitization
In 2013, Komatsu tried to address the problem by introducing
new construction machinery that used GPS, digital mapping,
sensors, and IoT connections to enhance efficiency. While its
machines performed well, overall efficiency improved less than Surveying Planning Construction Inspection
expected because of bottlenecks upstream and downstream of
the new smart machines.
To materially improve construction site productivity, Komatsu
found it had to transform its business—to move beyond selling,
renting, and servicing machinery and create solutions that would Step 1:
Vertical
enable customers to shape safer and more productive digitization
construction sites. Drone 3D survey 3D construction 3D construction Drone 3D finished
/measurement plan/simulation mgmt. with ICT landform inspection
That’s why, in 2015, Komatsu created the Smart Construction
Promotion Division to work more closely with customers and
other stakeholders involved in their construction projects. In
2017, Komatsu launched the open platform Landlog to bring Data Data Data

together data from people, their machinery, competitors’

exchange exchange exchange

machinery, building materials, and geography across the entire

construction process to better coordinate and manage Step 2:
construction programs end-to-end—shifting Komatsu’s role from Horizontal
digitization
being just another provider of machinery to orchestrating the
construction ecosystem.
By the end of 2020, Komatsu had introduced its Smart
Construction to more than 10,000 construction worksites in
Japan and has now also expanded the proposition to other
countries. Komatsu has experienced many ups and downs in its
100-year history. However, the way the company fundamentally
rethought how it works and how it creates value for customers
has let it shape its future and firmly taken it into the world beyond
digital.

25 Strategy& | PwC Strategy& | PwC 26

 Build a system of
privileged insights
with your customers

Build trusted relationships with

customers to gain unique insights
on their true wants and needs to
increase the value you create.

27 Strategy& | PwC Strategy& | PwC 28

 Build a system of privileged insights with your customers

Gaining privileged insights from

your customers is vital to
increase your relevance.
It requires trust and purpose.

Companies win because they’re able to address a fundamental

need of their customers better than anyone else. What that exact
need is, however, evolves over time; and what it takes to excel
A virtuous cycle of trust, purpose, and
at addressing the need changes all the time, in ever-faster privileged insights:
innovation cycles.

More trust from

Having good customer insights isn’t delivering on Greater customer
enough. You have to assiduously your promise engagement

invest in gaining privileged insights to

fuel your competitive differentiation.
4 steps to build a privileged insights system:
• Establish a foundation of purpose and trust: be crystal clear
about the value you create and the values, principles, and
governance around how you treat customers’ data and use your
insights. Better value More
proposition customer insights
• Lay out a purposeful customer insights approach and road map:
be guided by the problems you seek to solve for customers.
• Build and enhance your mechanisms for gaining customer
insights: make them an integral part of how you operate.
• Wire your privileged insights into how you work: use them to
systematically strengthen your value proposition, capabilities,
and offerings.

29 Strategy& | PwC Strategy& | PwC 30

 Build a system of privileged insights with your customers

Focusing on privileged insights

helps shape and prioritize your
data and technology strategy in
a way that fuels how you
create value.

As you go beyond digital, you will have to address the underlying

data and technology needed to support your privileged insights The connection between business,
and differentiating capabilities.
technology, and data strategy:
However good your business
strategy, it is going to fail unless Business strategy: Privileged
you connect it with your data insights—fed by data and
and technology strategy. supported by technology—are key
to keep your company relevant and
capabilities differentiated.
In many ways, data has become a new super-currency. But you
don’t necessarily need to own all the data—tap into the data of Data builds
your ecosystem to improve your insights. Technology: Your
the foundation
technology strategy should
The technology to capture data and turn it into insights exists and for strategy,
be prioritized based on what’s
is constantly innovated. Given how challenging these large and strategy
needed to gain privileged
investments can be, be clear about which technologies to determines
insights and build your
innovate and build versus leverage and integrate from your what data
differentiating capabilities.
ecosystem. to collect.

Shape your technology and data priorities, using your place in Data: You need a
the world and privileged insights as a guide. Focus on what coherent data strategy to
helps you build the differentiating capabilities that are key for determine how to collect,
securing your place in the world. store, secure, govern, and
analyze data, and how to
work in data ecosystems.

31 Strategy& | PwC Strategy& | PwC 32

 Build a system of privileged insights with your customers

Company story: STC Pay

Saudi Telecom’s financial startup STC Pay created a highly
successful fintech platform that provides innovative financial
solutions, banking technologies, and digital experiences for
Saudi businesses, citizens, and guest workers.
STC Pay’s very first offering was a “digital wallet” that enables
customers to send and receive money, shop, and control
finances through a single smartphone app. This offering was a
solution for the country’s large population of guest workers, who
typically had no banking relationship and remit the majority of
their compensation to family members in their home countries.
From there, STC Pay added many features to its app that helped
it attract other Saudi customers, for example, the ability to pay for
purchases by scanning items’ QR code, pay for gasoline by
authorizing payment at gas stations that have license-plate
Focus on
readers, or enable domestic workers or friends and family to value
spend from “shared accounts,” while keeping control over how creation
much they spend and what they spend on (e.g., paying for gas
and groceries is OK, withdrawing cash from an ATM is not).
How did STC Pay know which customers to target and what
would resonate with these customers? The company’s strategy is
almost entirely shaped by a deep study and understanding of
customer needs. All product designs start from personas, which
allow the company to put itself into the shoes of its customers STC Pay’s
and reimagine what would help them better manage their Listen Put
closely to sources of themselves
financial lives. This focus on the customer has allowed it to customer privileged into customers’
attract a community of fans that regularly give privileged feedback shoes
feedback to STC Pay, which it acts upon to further improve its
insights into
products. customers
STC Pay’s privileged–insights-based value creation strategy has
paid off: only two years after launch, STC Pay became the first
unicorn in Saudi Arabia and the first fintech unicorn in the Middle
East, putting it into a strong position to expand its services into
the UAE, Kuwait, and Bahrain.

33 Strategy& | PwC Strategy& | PwC 34

 Make your
organization
outcome-oriented

Bring together multidimensional skills in

outcome-oriented teams that deliver the
required differentiating capabilities.

35 Strategy& | PwC Strategy& | PwC 36

 Make your organization outcome-oriented

Organize in a capabilities-based
model, with outcome-oriented
teams in charge of delivering
your differentiated capabilities.

With success depending From the traditional …to the capabilities-based BUs must be even
more customer-
on scaling up complex
capabilities, you must organization… organization centric, integrating
capabilities and
change how you work Board of Directors Board of Directors shaping them toward
customer needs.
and redesign your Executive Leadership Team (ELT) Executive Leadership Team (ELT)
organization to support
Corporate center Corporate center Outcome-oriented
that new way of working. teams bring together
Corp. Corp. Corp. Corp. Corp. Corp.
… … multi-disciplinary skills
You can’t get away with Strategy Finance Comms Strategy Finance Comms and deliver
plucking people out of capabilities. Unlike
Business units/regions Business units/regions typical cross-functional
their functional roles and teams, they:

Functions Outcome-oriented teams

asking them to work BU/ BU/ … BU/ BU/ … • are long-lived
region region region region • have members
together 10–20% of their dedicated full-time
Customer solutions 1 2
time. Instead, you need
Functions/Shared Services

HR to building
capabilities
to build more durable Total quality • have their own
outcome-oriented Finance budget and
teams that deliver Customer experience personnel
Legal • are led by
your differentiating Innovation top execs.
capabilities by bringing
together the many Marketing …
different skills and HR Functional teams
… focus on mono-
experiences they Finance
functional work
need from across Marketing and drive
…. …
the organization. functional excellence.

Changing lines and boxes alone won’t be enough to cement this
capabilities-driven way of working. You will need to address your
organization’s DNA by:
▪ Rewiring budget ownership and channeling investments to the
capabilities that drive your advantage
▪ Redesigning how you define, measure, and reward performance
▪ Putting in place career models that enable fluid organization
▪ Facilitating the change by shaping new behaviors

37 Strategy& | PwC 44 Strategy | PwC Strategy& | PwC 38

 Build a system Make
of privileged
your organization
insights with
outcome-oriented
your customers

Company story: Microsoft

Microsoft’s outcome-oriented teams drive
customer outcomes by bringing together
After Satya Nadella’s appointment as CEO in 2014, Microsoft diverse skills:
undertook a major transformation to position for success in an
“AI/cloud-first world”: instead of licensing software and selling
products to customers, it would provide solutions to help Industry prowess to provide tailored expertise
companies become digital and to drive consumption.
Technical/engineering competency to design the target state
One of the key organizational changes underpinning Microsoft’s
refresh was the transformation of the company’s global Customer success expertise to promote usage
commercial business. It had to move away from its traditional
functions—presales, sales, and post-sales—to more integrated
roles better aligned with customers’ needs. In an effort that
changed the jobs of 40,000 people overnight, Microsoft therefore:
• realigned specialized account-team units to better support the
company’s top accounts with industry experts
• refocused specialist team units that include solution specialists
and technical solution professionals to focus on solving
customer business problems with technology (vs. selling
them technology)
• created a customer success unit to assist enterprise customers
with their entire cloud strategy and journey, helping them shift to
a consumption-based transaction model that is more directly
linked to their business outcomes.
With all these diverse skills coming together, Microsoft’s new
outcome-oriented teams were well positioned to deliver on the
company’s new place in the world.
Microsoft also redesigned its organizational DNA. It instilled new
behaviors and a new sales approach and ran a massive
technical upskilling program for everybody. It also started
measuring performance and compensating people based on
specific outcomes (e.g., customers’ consumption of services), not
output. Additionally, it replaced its traditional midyear review of
individual performance with a quarterly business connect in
which the team has a shared dialogue about what they, together,
need to do to succeed.
39 Strategy& | PwC Strategy& | PwC 40
 Invert the focus of
your leadership
team

Rethink the composition of the leadership

team to drive collaborative performance
and shift the team’s focus to propelling
the transformation.

41 Strategy& | PwC Strategy& | PwC 42

 Invert the focus of your leadership team

Your company’s success is

dependent on having your
leadership team drive the
transformation, together.

Working in a capabilities-based way is not how most leaders 3 actions that help you invert the focus
have grown up. Many companies typically experience a lot of
competition in their top ranks: competition for who’s managing of the leadership team:
the strongest P&L or whose function contributes most to those
P&Ls, and sometimes competition for the top job. This
individualist thinking, while rewarded in many modern Team Establish the top team based on the
corporations because it drives individual accountability, won’t right skills mix: What roles, skills, and
help you transform your company. backgrounds are needed to deliver the
capabilities you have chosen to focus on
and deliver on your reimagined place in the
You need to invert the focus of your world?
leadership team, away from working
in separate silos and toward shaping Agenda Shift your leadership team’s focus
toward driving the transformation, not
the future as an integrated team. just responding to today’s demands:
What structures and mechanisms will
Just as your company needs a strategic effort to build the right allow you to ensure the urgent does not
differentiating capabilities, your leadership team needs new overwhelm the important?
skills and mechanisms to shift to this new form of value creation.
Behaviors Take ownership for how your
leadership team collaborates and
behaves: How do you best instill the level
of shared accountability and collaboration
your place in the world demands?

43 Strategy& | PwC 44 Strategy | PwC Strategy& | PwC 44

 Invert
Invertthe
thefocus
focusofofyour
the leadership team

Company story: Eli Lilly

Eli Lilly was facing a major challenge in 2009, as patent
protection was about to expire on four drugs that accounted for Eli Lilly before and after the transformation:
40% of the company’s revenue. Instead of defaulting to what
many competitors were doing or what investors were asking
for—seeking a mega-merger or cutting R&D spending—then- 2009
CEO John Lechleiter made a brave decision: the company would CEO
innovate its way out of this problem.
Doing so required Lilly to speed up and significantly improve the
success rate of the company’s innovation process. Key to the Lilly Research Global Sales Other
Manufacturing
transformation was a change in operating model and a drastic Laboratories & Marketing functions

repositioning of Lilly’s top leadership team. Lechleiter created

five business units—diabetes, oncology, biomedicines, emerging
markets, and animal health—to enable more collaboration
focused on specific health outcomes. It also allowed for faster
decision-making that focused more on customers. In addition,
the company created a Development Center of Excellence to 2016
increase the speed and efficiency of the development of new CEO
Creation of 5 BUs instead
of functional model
products.
The top team underwent massive change, too. In line with the
Lilly Research Bio Meds Oncology Emerging
new operating model, a newly named Executive Committee was Laboratories
Manufacturing
BU
Diabetes BU
BU Markets BU
Elanco BU

set up and the heads of the five new business units were added
to the team, while the number of leaders with functional Other
8 new leaders among
top team of 13
responsibilities was drastically cut. Overall, eight of the 13 functions
members of the Executive Committee were new to that team,
with two being outside hires. The mix of backgrounds better
balanced science and commercialization expertise. And the
injection of a few disruptors made sure the team was going to
shake things up. To make sure that leaders “put team Lilly before
their own unit,” the company kept executive incentives linked to
total performance.
As the initial transformation plan promised, Lilly continued to
invest in R&D. By 2016, Lilly was firmly back on a path of
profitable growth.

45 Strategy& | PwC Strategy& | PwC 46

 Reinvent the
social contract
with your people

Reinvent your relationship with your

people, putting them at the center of
your value creation model and giving
them the means to lead and drive
the transformation.

47 Strategy& | PwC Strategy& | PwC 48

 Reinvent the social contract with your people

Components of the new social contract:

Companies need to reinvent the
social contract with their people
Become worthy of your
people’s engagement Give people the Connect people in
by articulating your opportunity to be supportive teams so they
so they drive value creation. purpose in a way that
is meaningful.
part of the solution, to
innovate and contribute.
can develop something
great together.

People engagement has always been important—but it takes

on a whole new meaning in the “beyond digital” age. It’s not just
that the scale of the transformation is so large that it requires
significant work from the organization, or that the pace of change Purpose Contribution Community
is such that no leadership team can hope to grasp it and react
to it fast enough; it’s that the very nature of today’s value creation
model requires you to integrate people—their experiences, skills,
judgment, and values—with technology, assets, and processes New social contract
into differentiating capabilities. But:

How do you get your people to take Development Means Rewards

ownership? How do you get them to
embrace change? How do you help them
volunteer ideas and take the right risks?
You will need to reinvent your social contract with your people—
putting them at the center of how you create value, and at the top
of your leadership team’s priorities.
Help people acquire the Give people time and Recognize that
skills and experiences resources to build the people’s perception of
required to thrive in the differentiating value goes beyond
“beyond digital” age. capabilities you have pay, and offer a more
committed to. comprehensive system
of rewards.

49 Strategy& | PwC Strategy& | PwC 50

 Reinvent the social contract with your people

Company story: Cleveland

Clinic
In the summer of 2020, Cleveland Clinic established a Chief
Caregiver Office to engage all caregivers across the system, and
to support its team-of-teams concept.
One key way of engaging the whole organization to solve
problems as they happen is Cleveland Clinic’s “tiered daily
huddles.” These are focused, 15-minute conversations that take
place every morning among a multidisciplinary team in each unit.
They follow a structured format that allows caregivers to speak
about the issues of quality, patient safety, experience, and
utilization of resources. Caregivers throughout all tier levels
resolve issues, often that same day. Issues that can’t be
resolved are escalated to senior teams, tier by tier. Daily huddles
start with the care teams at 7 am. and escalate to executive
leadership, where they conclude, by 11:15 a.m. Cleveland Clinic’s “tiered daily huddles”:
Huddles have improved everything from workplace safety to Escalated to top
patient experience to quality of care, facility repairs, and staffing. by 11:15 a.m.
They create a mechanism for the front line to raise issues,
develop solutions, and get the needed support from the top. As 6 CEO and Operations Council

the CEO of Cleveland Clinic explains: “Tiered huddles solve

problems in real time. They help us deal with today’s problems 5
Hospital system presidents, COOs, CNOs,
and ECNO
today, making our organization a better place to be a patient and
a better place to work. Tiered huddles are one way we are
working to create a culture where every caregiver is capable, 4 President, COO, ACNO/CNO
empowered, and expected to make improvements every day.”
Nursing directors and ACNO/CNO and
Daily tiered huddles not only give teams the setting to 3 Operations President, COO
communicate with one another to improve how they collaborate,
but they also help people on the front line directly contribute to
shaping how the organization works, and they make leadership 2 Managers and directors

accountable for helping the whole organization succeed in

fulfilling the company’s mission. 1
Caregivers at the unit level and
managers/supervisors
Start at 7 a.m.

51 Strategy& | PwC Strategy& | PwC 52

 Disrupt your own
leadership approach

Proactively invest in your own leadership

capability development, building a new
type of leadership that balances across
a range of leadership paradoxes.

53 Strategy& | PwC Strategy& | PwC 54

 Disrupt your own leadership approach

Today’s environment
requires a broader approach
to leadership. Leaders need
to disrupt themselves.

Navigating the shifting landscape of the world beyond digital The best leaders embody six leadership
requires a new form of leadership.
paradoxes:
The leaders we interviewed for our Strategic executor
How do you execute effectively while also being
research consistently emphasized that highly strategic?
they undertook a journey of personal Tech-savvy humanist
transformation that was every bit as How do you drive technology enhancement that
exciting and arduous as the one their generates future success while deeply
understanding human needs?
companies took.
High-integrity politician
Despite the specificity of each company’s—and each How do you navigate the politics of making things
leader’s—development journey, we have observed a common happen and still remain true to who you are?
set of characteristics among the successful leadership teams,
characteristics that on the surface seem quite odd: six Humble hero
leadership paradoxes. How do you act confidently in an uncertain world
and recognize humbly when you’re wrong?
All leaders will bring their own strengths to the job—but being
strong in one or two of these areas is probably not going to be Traditioned innovator
enough. So while you will build on your strengths, being deeply How to you drive innovation while staying true to
aware of this set of characteristics will help you be deliberate your purpose?
about your development, seek the right experiences, and
surround yourself with the right people who will round out your Globally minded localist
leadership profile. How do you navigate a world that is increasingly
both global and local?
Source: Based on Blair H. Sheppard, Ten Years to Midnight: Four Urgent Global Crises and Their
Strategic Solutions (San Francisco: Berrett-Koehler Publishers, 2020)
55 Strategy& | PwC Strategy& | PwC 56
 Disrupt your own leadership approach

4 principles that can help you shape

Leading in this new way is a your development:
stretch for many executives—
they need to actively shape
Be critically self-aware
their development. Have an honest conversation with yourself
about what your strengths are, but also where
you have weaknesses. Complement your own
view with feedback from others.

A recent survey conducted by Strategy&, PwC’s strategy

consulting team, highlights the importance of the six leadership Use your strengths to overcome
paradoxes, but also the degree to which many leaders are your weaknesses
struggling with these new demands.
Be deliberate about leveraging your discipline,
your creativity, your ease in rallying people
96%
90% around you—or whatever your strengths might
84%
be—to fill some of your gaps.

51% 49%
39%
Study those who aren’t like you
Strategic
Strategic executor Tech-savvy
Tech-savvy humanist High-integrity
High-integrity politician Look out for people who are great in areas you’re
executor humanist politician
not, observe what they’re doing, and develop
your own approach to learning, emulating and
83% adapting changes that are right for you.
72% 71%

42% 42% 36% Seek the right experiences

59
Throw yourself into situations that allow you to
Humble hero Globally minded localist Traditioned
Humble hero Globally Traditioned
innovator
innovator test and learn new behaviors. Many of those will
minded
localist
take you out of your comfort zone, but there’s no
Importance: % of respondents indicating that both characteristics of the paradox are
important or critical to the company’s future success better way of learning than by doing.
Proficiency: % of respondents indicating that top leaders in their organization are
good or best in class at both characteristics of the paradox
Source: Strategy& survey with 515 participants in 2021

57 Strategy& | PwC Strategy& | PwC 58

 Disrupt your own leadership approach

To succeed in the “beyond digital”

era, you need to tackle the 7
imperatives as a coherent system.

The seven imperatives are so intertwined that it would be very

difficult to pick just two or three to focus on. When you aren’t
1. Reimagine
your place clear about your company’s place in the world, for example, you
in the world won’t have a clear purpose that’s rooted in how you create value
for customers. You’ll lack a North Star for making decisions
7. Disrupt 2. Embrace about who’s in your ecosystem and how you should partner with
your own and create
leadership value via
those organizations. If you overlook any of these imperatives,
approach ecosystems you won’t be able to address the others successfully.
On a positive note, however, working on any one of those
imperatives helps your efforts in the others. Working in an
ecosystem, for example, allows you to glean deeper insights into
more customers from more angles. You can also combine forces
with ecosystem partners, offer greater value to customers, and
6. Reinvent 3. Build
the social privileged occupy a more ambitious place in the world. And you strengthen
contract with insights with the capabilities of your leadership team by giving them a chance
your people customers
to see intimately how other companies work.
We can’t stress enough the importance of being clear about the
differentiating capabilities your company will need to build, as
these are important to every imperative.
5. Invert the 4. Make your
focus of the organization
Our experience is that most companies will have significant work
leadership outcome- to do in most of these areas. Tackling one or two won’t be
team oriented
enough. Working on all seven imperatives creates a true
interlocking system that’s going to make your company fit for the
challenges ahead.

59 Strategy& | PwC Strategy& | PwC 60

The best time to plant
a tree was 20 years
ago. The second best
time is now.
Chinese proverb

Let’s get started.

61 Strategy& | PwC Strategy& | PwC 62

Additional resources
For more information about how to transform
your organization and shape the future, see
www.beyonddigitalleadership.com.
The full-length edition of Paul Leinwand
and Mahadeva Matt Mani’s Beyond
Digital: How Great Leaders Transform
Their Organizations and Shape the
Future contains deeper insights and
extensive stories of 12 forward-thinking
companies that have reinvented
themselves for the “beyond digital” era.
“Digitizing Isn’t the Same as Digital
Transformation,” article by Paul Leinwand
and Mahadeva Matt Mani in Harvard
Business Review
https://hbr.org/2021/03/digitizing-isnt-
the-same-as-digital-transformation.
63 Strategy& | PwC
About the authors
Paul Leinwand Mahadeva Matt Mani
Paul Leinwand is Global Managing Director, Capabilities-
Driven Strategy and Growth, with Strategy&, PwC's global
strategy consulting business. He is also an adjunct professor of
strategy at Northwestern University’s Kellogg School of
Management and writes regularly for Harvard Business Review,
strategy+business, and other publications.
Mahadeva Matt Mani is an adviser to executives across
industries on business model transformation and operating
performance improvement for Strategy&. He leads PwC’s
transformation platform and has worked with dozens of
companies across the globe on their transformation efforts over
the last 25 years.
Strategy& | PwC 64
Responses to Beyond Digital
“Many books have been written about transformation. But Beyond Digital
addresses transformation for the first time from a very comprehensive and
consequential perspective, addressing all the key elements. A must-read for
leaders who are serious about moving away from incremental change or one-
off change projects to a fundamental overhaul of the enterprise they are in
charge of.”
—Ingo Bank, CEO, OSRAM Licht AG
“This book will move your thinking into the mid-twenty-first century. The internet
is over fifty years old—’digital’ is yesterday. Here are seven insights about what
comes next. But consider each one with care. Don’t rush. A return to deeper,
more complex thinking, followed by decisive, bold action is the only way to win
in the postdigital world.”
—Sally Blount, CEO, Catholic Charities of Chicago; Michael L. Nemmers
Professor of Strategy and former Dean, Kellogg School of Management at
Northwestern University
“Beyond Digital takes a strategic approach to increasing the relevance of your
company in a world where technology and data open up new possibilities.
Leinwand and Mani focus on how leaders define the ‘what’—their purpose and
business model—and how they set their companies and themselves up for
success. This reimagination is critical for leaders of companies of all sizes,
including startups.”
—Joy Chen, cofounder and CEO, Pure Culture Beauty
“Businesses in today’s world cannot afford to stand still. But change is a
continuous journey. Beyond Digital’s approach underlines the fact that it’s
only when organizations and leaders are prepared to truly challenge and
change the way they think, act, and engage that lasting and meaningful
transformation happens.”
—Jean-Philippe Courtois, Executive Vice President and President, National
Transformation Partnerships, Microsoft
“In Beyond Digital, Leinwand and Mani bypass the buzzwords and clichés and
provide a rigorous foundation for digital business transformation. They show
how successful strategies are grounded in answering core questions such as
‘What is our purpose?,’ ‘What unique value do we add for our customers?,’ and
‘What distinct capabilities do we need to deliver on our value proposition?’ A
timely, insightful, and eminently useful guide for anyone leading business
transformation in today’s digital environment.”
—Daniel Diermeier, Chancellor, Vanderbilt University
65 Strategy& | PwC
“There is no shortage of books about the impact technology has on business
and how to differentiate a company from its competitors. But Beyond Digital is
the rare book that brings wise and practical advice to leaders at any level.
Combining clear insights about how value is created with cohesive leadership
principles, Leinwand and Mani show how even the most challenged enterprise
can prepare to compete today and win tomorrow.”
—Damien Harmon, Executive Vice President, Omnichannel, Best Buy
“Rather than writing one more book about how technology will change our
lives, Leinwand and Mani have captured a future view of the world in which
business leaders must cope. The fundamentals of every industry—demand,
supply, and context for success—have changed forever, and Beyond Digital
clearly describes the imperatives and actions that will make tomorrow's leaders
successful.”
—Ray Lane, Managing Partner, Greatpoint Ventures; former President, Oracle;
former Executive Chairman, Hewlett-Packard Company; member of the board
of directors, Beyond Meat
“Beyond Digital provides a detailed, well-researched road map for companies
looking to transform themselves in an era when digitization is no longer a
differentiator. The authors cite examples from successful international
organizations to challenge leaders to push past the defeatist sentiment ‘that’s
how we’ve always done it’ to achieve true transformation.”
—Tom Mihaljevic, MD, CEO and President, Cleveland Clinic
“Recent technological innovations are accelerating structural change across
industries while also facilitating the resolution of social issues. To make the
best use of these innovations, today’s companies must reimagine who they
are, open new pathways to value creation, and transform their business. Based
on an in-depth study of a dozen success stories, Beyond Digital reveals how
any organization can translate this challenge into success. I strongly
recommend it to all leaders who aspire to transformational change.”
—Naoki Tani, Executive Vice President, Chief Technology Officer, and
Executive General Manager of R&D Innovation Division, NTT DOCOMO
“Beyond Digital challenges leaders to get past the obsessively competitive race
toward digitization. Instead, this book helps them transform their companies by
using technology to solve the massive challenges and opportunities facing
society today.”
—Scott Watterson, Chairman of the Board and CEO, iFIT Health & Fitness
Strategy& | PwC 66
Strategy& is a global As a part of PwC, every As the only at-scale The result is an authentic
strategy consulting day we’re building the strategy business that’s strategy process powerful
business uniquely winning systems that are part of a global enough to capture
positioned to help at the heart of growth. professional services possibility, while pragmatic
deliver your best future: We combine our powerful network, we embed our enough to ensure effective
one that is built on foresight with this strategy capabilities with delivery. It’s the strategy
differentiation from the tangible know-how, frontline teams across that gets an organization
inside out and tailored technology, and scale to PwC to show you where through the changes of
exactly to you. help you create a better, you need to go, the today and drives results
more transformative choices you’ll need to that redefine tomorrow. It’s
strategy from day one. make to get there, and the strategy that turns
how to get it right. vision into reality. It’s
strategy, made real.

strategyand.pwc.com

© 2021 PwC. All rights reserved.

All rights reserved. PwC refers to the PwC network and/or one or more of its member firms, each of
which is a separate legal entity. Please see pwc.com/structure for further details. This content is for
general information purposes only, and should not be used as a substitute for consultation with
professional advisors.