Digital transformation leaders show laggards the route to success
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Digital transformation leaders show laggards the route to success

Jim Mortleman — August 2018

Global digital transformation survey highlights the need for organizations to tap into an ecosystem of partners to co-create their future success.

Companies currently experiencing the most positive outcomes from digital transformation have embraced a strategy of co-creation, working hand-in-hand with a broad range of technology and business partners, as well as academia and government agencies, according to a worldwide survey of more than 1,500 business leaders. The Global Digital Transformation Survey 2018, conducted by ICT vendor Fujitsu, also reveals that the most digitally transformed businesses have higher levels of agility, find it easier to hire skilled staff and, perhaps surprisingly, make a greater contribution to the environment and society.

Overall the survey paints a picture of an uneven digital landscape across different sectors and geographies. The most notable differences are between the businesses that provide all their goods and services via the internet — referred to as ‘online businesses’ in the survey — and those with a mix of traditional and online channels. Predictably, the digital transformation strategies of the 42% of online companies in the survey are the most mature, with almost all (97%) reporting they have planned, implemented and tested digital transformation projects. In contrast, only two-thirds of the more traditional companies questioned said they had embarked on digital transformation.

Different industries are running at different transformational paces, the survey found. Among traditional businesses, the finance sector appears to be the most advanced, with 89% of respondents well into their digital transformation journey. “This likely reflects the fact that technologies such as analytics and AI are seen as providing significant competitive advantage in the sector, and organizations appreciate that staying at the forefront of technological change is critical for success,” the survey report says.

Other sectors are not too far behind. Between 60% and 69% of companies in manufacturing, transportation, retail and healthcare have digital transformation underway.


The business drivers behind transformation initiatives also differ from industry to industry. In the case of businesses with more traditional business models, the quest for greater efficiency and cost reduction is the main motivation behind digital transformation projects.

That was cited by around 40% of respondents from the manufacturing and healthcare sectors and just over 31% of financial services companies. For transportation companies, the need to respond to competitive threats is the primary driver (identified by 30%), at least in part reflecting the rapid rise of digitally led logistics services.

When it comes to delivering business benefits from digital transformation, two sectors — finance and retail — led the way. Excluding online-only companies just under 30% of respondents from finance firms reported that they had seen positive outcomes, closely followed by 28% in retail. Once again healthcare lagged behind, with only 14% of respondents reporting positive outcomes.

Collaboration breeds success
So what factors separate the digital transformation leaders from the laggards? The survey found one key differentiator is the extent to which more digitally advanced organizations embrace co-creation with a wide range of partners. Six out of ten of the online-only companies said that as well as partnerships with technology partners, suppliers and customers, they also viewed tie-ups with start-ups, companies in other industries, academia, research institutions, governmental organizations and industry consortiums as crucial to their success.

Among more traditional companies, in general, only about 30% placed a priority on these types of partnerships. However, the more digitally advanced respondents among them had similar views on the value of co-creation to their counterparts at online-only companies.

There was a similar correlation between leaders in digital transformation and companies that were actively working to further the UN’s Sustainable Development Goals (SDGs), which aim to end world poverty, protect the environment and ensure all people can enjoy a peaceful and prosperous life.

“Excluding online-only companies, 91% of respondents that had delivered outcomes to a greater extent said their CEO understands the importance of SDGs and their organization has integrated such goals into its business strategy. Moreover, 86% have already engaged with partners in other industries to contribute to SDGs,” the report notes.
Flexing your digital muscles

Delving deeper into the success factors that set digital leaders apart, the survey compared the capabilities of respondents that had delivered different levels of outcomes from digital transformation. It found that the most digitally transformed organizations demonstrate higher capabilities in six key areas — leadership, people, agility, business integration, ecosystem and value from data. Significantly stronger capabilities in all six areas were evident among both online companies and those traditional companies that had delivered the most positive outcomes from digital transformation.


The report illustrates the point: “As their capabilities in all areas increase, companies move further along the digital transformation path. A good parallel to this might be an athlete who needs to build up strength before a big race. Understanding this is a gradual process, he or she commits to training in order to build and develop their muscles. Organizations might want to think of the six success factors as their ‘digital muscles’ — the stronger these become, the more likely they are to deliver successful outcomes from digital transformation.”

Most notably, there is a huge leap in agility between those traditional companies that have struggled to deliver outcomes (fewer than six out ten said they were agile) and those that have delivered outcomes to a greater extent (almost all said their organization had developed high levels of agility). This seems to suggest that just dabbling with digital transformation is not sufficient — organizations need to embrace it fully and remodel themselves fundamentally in order to gain the most agility benefits.

Other areas where the companies delivering the most positive outcomes from digital transformation show significantly higher capabilities than all others are ‘ecosystem’ (which again highlights the positive benefits of co-creation with a wide range of partners) and ‘people.’


The latter is a significant finding since the survey also identified that, for the majority of traditional sectors, lack of skilled staff is their biggest challenge when it comes to digital transformation. “For companies whose operations are not 100% internet-based, it is the number-one concern at the planning, testing and implementation phases, and is only nudged into second place by cybersecurity risks in the post-implementation phase,” the report says. The fact that a large proportion of digitally transformed businesses rate their people as a strong capability suggests that these organizations are better able to attract skilled staff than those that are not as far along their digital journey.

Embracing AI

The survey also examined business leaders’ attitudes to one of the most talked-about technology topics of recent years — artificial intelligence (AI), and found that the appreciation of its impact was greatest in the finance sector. Here 70% believe AI will help create smart services and 67% say it will support decision-making and automate knowledge management.

There is also high awareness of AI’s impact in the manufacturing sector, where 67% of respondents said the technology would automate many processes. The healthcare sector had the lowest awareness of AI’s impact, with fewer than half of respondents thinking it would have an impact on any areas apart from the automation of knowledge search and management, where only just over half thought it would.
Across all respondents, however, there is widespread belief that AI will be increasingly useful to business in future. “Although 69% of the respondents say AI will take over some tasks currently carried out by people, 68% agree that people and AI will increasingly collaborate on tasks and 61% are confident that the technology will create new jobs,” says the report.    

• Download the Global Digital Transformation Survey Report here.

First published August 2018
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