Anatomy of a digital forerunner

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It’s no secret that digital technology has transformed the business landscape in ways few could have anticipated even five short years ago. What’s new is that the technologies and solutions that once seemed far-fetched are rapidly becoming table stakes in most industries.

Data, analytics and connectivity are reshaping every sector of the global economy. Amazon and Alibaba have set the pace in retail, largely without owning stores. Airbnb is one of the highest growth brands in hospitality despite the fact that it neither owns property nor operates hotels. Business and retail customers alike have come to expect a smooth, omnichannel buying experience whether they are purchasing a pair of socks or a million-dollar piece of construction equipment. Even the most traditional companies are finding ways to transform their competitiveness by reinventing back-office processes, speeding up supply chains and reimagining service offerings. The most advanced of these we refer to as digital forerunners—the companies that combine the scale advantages of incumbents with the speed and agility of native digital businesses.

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What’s at stake, of course, is industry leadership. The companies that can increase their digital fluency and create value throughout the enterprise are increasingly coming to dominate most markets. And because so many digital offerings and business models also create network effects that amplify the advantages of scale, it is especially critical not to be left behind.

Most executive teams understand this. They recognize the power of technology to change the rules of engagement in their industry. Yet many are unsure where to begin and become overwhelmed by the seemingly endless set of investment options. In our experience, the relative few companies that are setting the pace in digital transformation push past this moment of indecision and dive in, confident that they will gain a deeper understanding of their customers’ needs and use it to develop innovative, elegant solutions. These digital forerunners are transforming themselves in a wide variety of ways. The best, though, share five key characteristics:

  1. The vision to disrupt, not be disrupted 
  2. A commitment to understand customers and take action 
  3. An integrated customer experience 
  4. Speed and innovation 
  5. Capabilities that cross over traditional boundaries