For many companies, the process of building and executing strategy in the digital age seems to generate more questions than answers. Despite digital’s dramatic effects on global business—the disruptions that have upended industries and the radically increasing speed at which business is done—the latest McKinsey Global Survey on the topic suggests that companies are making little progress in their efforts to digitalize the business model. Respondents who participated in this year’s and last year’s surveys report a roughly equal degree of digitalization as they did one year ago, suggesting that companies are getting stuck in their efforts to digitally transform their business.
The need for an agile digital strategy is clear, yet it eludes many—and there are plenty of pitfalls that we know result in failure. McKinsey has looked at how some companies are reinventing themselves in response to digital, not only to avoid failure but also to thrive.
In this survey, McKinsey explored which specific practices organizations must have in place to shape a winning strategy for digital—in essence, what the operating model looks like for a successful digital strategy of reinvention. Based on the responses, there are four areas of marked difference in how companies with the best economic performance approach digital strategy, compared with all others :
- The best performers have increased the agility of their digital-strategy practices, which enables firstmover opportunities.
- They have taken advantage of digital platforms to access broader ecosystems and to innovate new digital products and business models.
- They have used M&A to build new digital capabilities and digital businesses.
- They have invested ahead of their peers in digital talent.