A Global Supply Chain Study Shows a Digital Strategy

The leaders in the manufacturing industry have transformed to digital leaders. When it comes to optimizing the supply chain, manufacturers are undergoing a digital transformation.

A global study of digital businesses done by MIT Sloan Management and Deloitte Digital finds that the key driver to success in the digital arena is strategy, not technology. In order to be digitally mature in the industry, businesses will need to focus on a strategy to integrate social, mobile, analytics and cloud into their business.

With most of the manufacturing industry focused on attracting and retaining the best talent, company leaders understand that the key to success is to incorporate a digital strategy. Based on the MIT report, “Strategy, Not Technology, Drives Digital Transformation”, the following are key findings from more than 4,800 business executives across 27 industries and 129 countries.

2015 Digital Business Global Executive Study and Research highlights:

• Digital strategy drives digital maturity. Only 15 percent of respondents from companies at the early stages of what the study refers to as digital maturity – in which digital has transformed processes, talent engagement and business models – say that their organizations have a clear and coherent digital strategy. Among the digitally maturing, more than 80 percent do.

• The power of a digital transformation strategy lies in its scope and objectives. Less digitally mature organizations tend to focus on individual technologies and have strategies that are decidedly operational in focus. Digital strategies in the most mature organizations are developed with an eye on transforming the business.

• Taking risks is becoming a cultural norm.� Digitally maturing organizations are more comfortable taking risks than their less digitally mature peers. More than 50 percent of respondents from less digitally mature companies see their organization’s fear of risk as a major shortcoming. To make their organizations less risk averse, business leaders should embrace failure as a prerequisite of success. They must also address the likelihood that employees may be just as risk averse as their managers and will need support to become bolder.

• The digital agenda is led from the top. Maturing organizations are nearly twice as likely as less digitally mature entities to have a single person or group leading the effort. In addition, employees in digitally maturing organizations are highly confident in their leaders’ digital fluency. Digital fluency, however, doesn’t demand mastery of the technologies. Instead, it requires the ability to articulate the value of digital technologies to the organization’s future. More than 75 percent of respondents from digitally mature companies say their leaders have sufficient skills to lead digital strategy. Nearly 90 percent say their leaders understand digital trends and technologies. Only a fraction of respondents from early stage companies have the same level of confidence: 15 percent and 27 percent, respectively.

• Stories gain employee buy in and organizational traction for digital transformation. Telling digital stories creates pride in organizations. Companies need to demonstrate their ability to tell the digital story and what it means to live in the digital world for business.

• Innovation of digital technologies must be fostered. More than 70 percent of respondents from maturing companies say that their managers encourage them to innovate with digital technologies. At lower levels of maturity, only 28 percent of respondents express the same sentiment.

• Investments in skills necessary to realize strategy. Digitally maturing organizations are four times more likely to provide employees with needed skills than are organizations at lower ends of the spectrum.

To read the full report, download it here.

Connect with our MEP Supply Chain experts for more details on how you can optimize your supply chain using a digital strategy and other technological advancements.