Digital transformation (DX) derives major fluctuations in the planning and execution of a digital strategy. Some companies revamp their digital strategies not just to dodge failure, but also to thrive their market worth.
In this article at McKinsey & Company, Jacques Bughin with his co-author Tanguy Catlin explains some effective strategies to form a winning move for a digital operating model.
Agile Digital Strategy
There are four key areas of a noticeable difference in how companies perform their best digital strategies. The top-performing ones must augment the agility of their digital strategy. Here are the four key elements to keep in mind while doing so:
- Upsurge the Agility: To step-up DX, the organizations must rapidly reallocate resources and capital. The top-performing ones can differentiate themselves from the rest by being adaptable to digital transformation. This will help them remain spontaneous in spotting emerging opportunities or covering loose ends.
- Invest in Sound Ecosystem: DX has encouraged the creation of new marketplaces, data sharing, and the benefits of network effects at a scale that was impossible before. The digital ecosystems created by these marketplaces are blurring industrial limitations. They are already active in their respective ecosystems and are positioned to understand their customer’s needs, which is becoming broader and more integrated. The top performers seem to be developing way more innovative offerings than their peers.
- M&A to Expand Digital Capabilities: The top performing firms spend way more on mergers and acquisitions (M&A) than others. Not only spending, but they are also investing in diverse M&A activities which may bring them much-improved revenue and market position. Surprisingly, the top economic performers take a diverse approach to the M&A by investing more in acquiring new digital businesses and capabilities instead of spending on low-performing non-digital ventures.
- Invest in Digital Talent: Finding the right digital resource may turn into a key enabler for success in the digital arena. Hence, look for a well-qualified digital talent which may not be easy. The top economic performers are making a great effort to resolve this issue by dedicating their existing workforce to digital initiatives and training programs.
The author believes that a digital strategy must be adaptable to the constant digital transformation happening outside the organization as well as inside. Given the breakneck pace of such transformations, enable first-mover opportunities by revisiting, iterating, and adjusting to the more frequent strategies of the modern business landscapes. Click on the following link to read the original article: https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/a-winning-operating-model-for-digital-strategy