If your company gets digital, you’ve got a digital marketing strategy and you’ve gone social, that’s it surely? Unfortunately, no. A recent McKinsey report concludes that businesses need a companywide strategic shift to make digital pay.
Fairway Consulting offer an integrated company-wide digital assessment to ensure that your company doesn’t get left behind and you can realise the opportunities that digital offers.
In this day and age, it’s easy to assume that the economy’s digitalisation is already far advanced. However, on average, industries are less than 40 per cent digitised, despite the relatively deep penetration of these technologies in media, retail and hi-tech.
Recent research from McKinsey has shown that companies must act decisively to survive, whether through the creation of new digital businesses or by reinventing the core of today’s strategic, operational, and organisational approaches.
More digitalisation — and performance pressure — ahead
Through reducing economic friction, digitalisation enables competition that, in turn, pressures revenue and profit growth. And there’s more pressure ahead, as digital penetration deepens.
That economic pressure will make it increasingly critical for executives to pay careful heed to where—and not just how—they compete, and to monitor closely the return on their digital investments.
McKinsey’s study suggests that some companies are investing in the wrong places, or investing too much (or too little) in the right ones — or simply that their returns on digital investments are being competed away or transferred to consumers. On the other hand, the fact that high performers exist in every industry indicates that some companies are getting it right.
Where to make your digital investments
Improving the ROI of digital investments requires precise targeting along the dimensions where digitalisation is proceeding. Digital has widely expanded the number of available investment options, and simply spreading the same amount of resources across them is a losing proposition.
Distribution channels and marketing have been the primary focus of digital strategies and investments thus far. However, this critical dimension is increasing just par for staying in the game, it is now no longer enough to just be doing this. Companies are overlooking emerging opportunities, such as those in supply chains, that are likely to have a major influence on future revenues and profits.
McKinsey’s study found that the most successful companies are being bold in the magnitude and scope of their investments. The more aggressively they respond to the digitalisation of their industries across the board — up to and including initiating digital disruption — the better the effect on their projected revenue and profit growth.
Being a digital winner
Digital winners tightly integrate their digital and business strategies. They don’t cherry pick to digitalise silos within their company. Instead, they respond to digitalisation by changing their corporate strategies significantly. They invest more, and more broadly and boldly than other companies do.
The case for digital reinvention – Mckinsey