The Key Traits of an Effective Digital Strategy

After three years of research, the single biggest indicator of a company's digital maturity is whether it has a clear and coherent digital strategy. Joint research conducted by MIT Sloan Management Review with Deloitte in 2015; It reveals that more than 80% of companies are digitally mature and have a clear and coherent digital strategy, while less than 20% of participating companies are less digitally mature companies.

A Clear, Consistent Digital Strategy Is Important.

Having a clear and consistent digital strategy is the biggest indicator of a company's digital sophistication.

Considering the importance that strategy brings to digital sophistication, it will come as no surprise that this article will not help you or your company develop a digital strategy. Developing an effective digital strategy is something that must be unique to your company and involves a careful assessment of the competitive landscape, your company's capabilities and resources, the state of relevant technology, and other possible variables.

All the books in this field are written on specific types of digital strategies, and most of them are quite good. For example, George Westerman, Didier Bonnet and Andrew McAfee discuss well in their books how large companies gain strategic advantage by using digitalization. David Rogers of Columbia University has written a volume on how leaders should update their thinking about the digital age. Marshall Van Alstyne and his colleagues wrote a book just for platform businesses. I can recommend my colleague John Gallaugher's textbook as perhaps the most consistently up-to-date critical book on digital strategy ever written – he updates the content every year.

Considering the variety shown in this article alone, there are many different digital strategies that may be effective in a particular environment. Digital tools can be used in different “right” and surprising ways to add value to a company.

Although there are many differences in the characteristics of digital strategy in digitally developing companies, our research shows that these strategies have a number of common features. Understanding these shared characteristics can help you ensure your company's digital strategy is on the right track.

1- (More) Long Term Thinking

Digitally evolving companies tend to think over a longer period of time when developing their strategies. While this time is five or more years for underdeveloped and developing companies, developing companies are twice as fast in this respect, in short, it is shorter.

While the past decade has seen widespread digital disruption with the rise in the use of social media, mobile platforms, and analytics products, the next decade will see the emergence of new digital disruptions that will be just as disruptive, such as virtual reality, artificial intelligence, and increased automation.

Developing a digital strategy, “single-purpose” What happens is an effort; It will continue to develop step by step with technological innovations.

But even a five-year period may not be long enough. Deloitte's John Hagel regrets that most companies don't go far enough when considering digital strategy. Hagel advocates at least occasionally using a 10- to 20-year timeframe, as opposed to the one-to-three-year timeframe most companies use for digital strategy. In our own research, we found that the vast majority of companies haven't thought about this for a long time. But we have seen more and more company leaders begin to realize that such a long view is necessary. For example, Walmart Stores Inc. realized it needed to start its digital transformation now because what its customers want ten years from now will be radically different from what they want today.

2- Communicate the Digital Strategy to Employees Effectively

Secondly, our research has shown us that senior management support is indispensable when executing a digital strategy; Therefore, support is sought from lower-level managers and front-line employees. These managers can serve as effective sensors for unintended interference or impact of your digital strategy.

For example, when Volvo began to innovate its cars, this led to a number of other changes in management, contracting and collaboration to support the innovations the company was developing. Cross-functional connections and information sharing were key to these changes. Without strong communication at all levels of the organization, senior executives may not know when changes are needed to help the digital strategy achieve its goals.

Non-executive leaders can be valuable first-aiders who help overcome challenges related to executing digital strategy. Therefore, once this strategy has been communicated effectively, they should be given some time to take action on the issues they identify.

One of the working hypotheses of our 2018 research is to transfer decision-making correctly to the organizational hierarchy in order to enable more digitally developing companies and the organization to respond faster to digital trends.

3- Establishing the Foundation for Business-Related Digital Strategy

Finally, the digital strategy found in most advanced companies essentially involves their core business. In contrast, respondents from less digitally advanced companies indicated that their organizations were more vocal about digital business or viewed digital business strategy as a collection of one-off initiatives that did little to impact the underlying business