When McKinsey, one of the internationally most recognized consulting firms, publishes the results of its global surveys, executives and managers usually prick up their ears to hear all about the latest consumer and business trends. This was also the case with its recent study on the subject of social enterprise.
The study is a follow-up on a global online survey conducted in 2012. This time, Brad Brown, Johnson Sikes, and Paul Willmott asked 850 CEOs and executives about what they believe are the five most important digital-enterprise trends: 1) big data and advanced analytics, 2) digital engagement of customers, 3) digital engagement of employees and external partners, 4) automation, and 5) digital innovation. The clear result: All five trends are a high strategic priority for companies.
- Customer engagement most important trend
56 percent of respondents say digital engagement of customers is at least a top-ten company priority, and on the whole respondents report notable progress since 2012 in deploying practices related to this trend. Companies have made particularly big gains in their use of digital to position material consistently across channels and to make personalized or targeted offers available online.
- Digital engagement of employees, suppliers, and external partners still lagging behind
Companies have been slower to adopt digital approaches to engaging their own employees, suppliers, and external partners. Here, executives say their companies most often use online tools for employee evaluations and feedback or knowledge management; smaller proportion report more advanced uses, such as collaborative product design or knowledge sharing across the supply chain.
- Significant growth in the company-wide use of big data/advanced analytics tools
Big data/advanced analytics tools are now commonly used throughout the organization to improve decision making, R&D processes, budgeting, forecasting, and planning processes. The authors of the study note that this matches their experience consulting with a large variety of companies, where they are seeing executives consider analytics to be critical for success and dedicate increasing attention to the development of new analytics tools. In addition, the survey revealed that big data/advanced analytics tools are used primarily to increase revenue or improve process quality; reducing costs plays a minor role in this context.
- Diverse approaches to business-process automation
Companies are automating a wide range of functions to improve the overall quality of processes (e.g., by removing breaks or errors) or to build new digital capabilities (e.g., remote monitoring) into the processes. Again, only few respondents say that intentions to reduce costs or replace labor play a major role in this.
- Digital innovation continues to be on the rise
40% of respondents say their companies are either incorporating digital technology into existing products or improving their technology operating models (e.g., using cloud computing). However, not more than 23% say they are creating digital-only products.
As the biggest challenges in implementing these trends, respondents cite organizational issues, such as the lack of senior-management support and internal leadership, organizational misalignment, and poor program management, as well as talent issues. Nevertheless, CEOs and executives remain optimistic about digital business. 65 percent say they expect these trends will increase their companies’ operating income over the next three years. Here, the biggest hopes are placed on customer engagement.
No wonder, then, that more and more CEOs are now actively supporting the digital initiatives of their companies. 31 percent of respondents say their CEOs personally sponsor these initiatives, up from 23 percent who said so in 2012. In addition, many companies are appointing Chief Digital Officers (CDO) and are investing heavily in their digital programs. All this underlines the strategic importance of the digital transformation for the future success of the enterprise.
The full report is available from McKinsey.
Brown, B., Sikes, J., & Willmott, P. (2013, August). Bullish on digital: McKinsey global survey results. http://www.mckinsey.com/insights/business_technology/bullish_on_digital_mckinsey_global_survey_results?goback=.gde_57447_member_266190395#!