How to get digital transformation right


How can organizations better compete in a world of ever-changing digital technologies? Mike Cooray and Rikke Duus outline the challenges and opportunities presented by the digital revolution.

Added on 13 June 2016 by Mike Cooray,Rikke Duus

Digital formation


By 2020, 75% of businesses will be a digital business or will be preparing to become one¹. Only 30% of these efforts will be successful due to a lack of talent and technical expertise. Digital transformation is affecting businesses across industries. It is driven by new technologies, fierce competition and increasing expectations from customers of a ‘digital-first’ experience. Digital transformation can be defined as the use of technology to radically improve the performance and reach of organizations². Technologies, including cloud, mobile, big data and the Internet of Things (IoT), are amongst those causing disruption to established industries, organizational structures and customer expectations.

We are in the early stages of a research project looking at organizations’ adoption and use of digital technologies. The study looks at organizations’ use of technology to enhance operations, marketing, customer engagement and innovation.

Preliminary findings show that 30% of respondents are using the automation of processes to drive digital transformation and 82% rated this to be an effective initiative. The key factor holding back adoption and use of digital technologies is the lack of appropriate IT systems (61%) to implement digital initiatives in the organization.

In terms of organizations’ use of data analytics and big data to enhance customer service, 31% of B2C organizations used these technologies compared to 12% of B2B. B2B and B2C organizations also take different approaches in their transition to digital. B2B organizations are more likely to appoint a Chief Technical/Transformation Officer whereas B2C organizations have digital transformation project teams.

What has become increasingly clear, is that success in the digital age requires more than talent and technical expertise. It requires the vision to re-imagine and re-invent the business, taking advantage of the opportunities digital creates.

With 608,110 new startups founded in 2015³ and many of these in tech domains, there is ample reason for larger established businesses to identify opportunities for a digital overhaul. One place to start is the business model. The question is, how can digital technologies help re-imagine and re-invent existing business models to ensure boosted competitiveness and value creation for customers?

Business model re-innovation can be the key to survival. However, a recent study by Harvard Business Review⁴ found that executives are mainly using digital to improve customer service, productivity, product innovation and revenue and not taking a holistic business-wide view. Competing in the age of digital has its own challenges. 


Converting data into insight

Data alone does not always lead to new opportunities and may even put the organization on the wrong track. That is because data, in isolation and without context, is not always the best indicator of which strategic move to make next. 

Inability to respond to opportunities

Organizations may have all the required skills and expertise, systems and financial resources to take advantage of new digital opportunities. However, bringing these together in a way that leads to cutting-edge innovation, timely competitive responses and the best utilization of skills is a challenge for most.

Joining up the physical and digital worlds

Many traditional bricks-and-mortar organizations realize the need to extend their presence into the digital space. How best to go about this, while still serving their core customers, is often a challenge. The opportunity lies in using digital to enhance value created for customers and engaging with them at their convenience. This means embracing new digital platforms and partnerships in order to extend their presence and gain new digital capabilities.

Protecting customer data

It is important that organizations build consumer trust by offering transparency in how data is gathered and utilized.


Creating inter-industry collaborations

Digital transformation requires organizations to collaborate within and outside of the organization. Organizations that are better equipped to bring together expertise, systems and data are able to develop stronger business models faster and be more effective in fiercely competitive sectors.

Designing superior customer experiences

Proactive organizations use data and digital interfaces to create customized and individualized experiences for customers. Data can be used to add value to the key customer journey and build a competitive advantage for the organization.

Empowering customers

With digital technologies organizations can intensify their engagement with customers and put more control in their hands. Consumers are excited to be empowered by organizations and are looking for immersive omni-channel experiences.

Enhancing employee productivity

New wearable technologies are emerging that enable employers to track their staff’s health, productivity - and even their ability to create beneficial collaborations. Using wearable sensors and digital data, companies can create people analytics and insights to enhance the well-being and efficiency of the organization. 

Looking ahead

Open data, analytics, cloud technology and IoT are set to transform industries and challenge the status quo. The power of digital platforms creates new opportunities for invisible competitors to successfully penetrate markets that they may not have the expertise, skills or knowledge of, yet successfully build them in a short period of time. Future organizations will not only be digitally transformed and connected, they will also have the unique ability to respond to new opportunities with greater agility. This invariably raises the question of how these new-age organizations can develop strategy, align resources and develop dynamic capabilities.

We see a future where organizations that are transparent, agile and collaborative stand the best chance of growth and sustained competitiveness. The challenge for many well-resourced and large organizations is that their leaders’ thinking is often analogue and the digital natives are able to take a march on them.

The full article in the Spring 2016 360º Ashridge Journal goes onto discuss the future of connected ecosystems. 

See the full article

If you are interested in this subject take a look at our 3-day Open Program The Digital Organization run by Mike and Rikke

1.     Lopez, J. (2014). What Are You On The Digital Business Development Path? Gartner Research. Retrieved from:

2.     Westerman, G., Bonnet, D., & McAfee, A. (2014). Leading Digital: Turning Technology into Business Transformation. Boston: Harvard Business Review Press.

3.     Startup Tracker. (2016). Retrieved from:

4.     Harvard Business Review (2015). The Digital Transformation of Business. Harvard Business Review Analytics Services.