Posted by Mumbai: 60% Organisations are capable of successful digital transformation, a Capgemini Research Institute’s new report claimed.
This new study surveyed 1000 executives from organisations with $1 billion and over revenue across sectors to find their organisation’s maturity in terms of digital and leadership capabilities required for digital transformation.
Close to two-thirds of organisations today have the digital (60%) and leadership (62%) capabilities required to successfully implement digital transformation. It’s a 36% increase on both fronts in just two years.
The new report titled – Digital Mastery 2020: How organisations have progressed in their digital transformations over the past two years, examined average ratings across four categories: talent and organisation, operations, business model innovation, and customer experience (CX).
In comparison with its 2018 research on digital mastery, the new report reveals that while all organisations are doing better in their digital transformation journeys in 2020 but there’s a widening gap organisation.
Digital masters – organisations with a high level of mastery across digital and leadership capabilities against their competitors.
Interestingly, the report found COVID-19 has a powerful accelerant for organisations that led to rapid change, and have become more enthusiastic and optimistic about their capabilities.
Since 2018, organisations have put time to evaluate the challenges, have been increasing investment in digital transformation and emerging technologies’ adoption as well as putting a renewed focus on talent and culture.
Large organisations, with $10 billion or more in revenue, have been found to have an edge in both digital and leadership capabilities. Some 68% of these organisations say they have the required digital capabilities, compared with 55% of those with less than $10 billion in revenue.
When it comes to leadership capabilities the gap is similar: 57% of smaller organisations say they have the required leadership capabilities, marginally lower than the overall average of 62% and the 70% seen among large organisations.
Among 60% Organisations from a sectoral perspective, every industry has progressed in both its digital and leadership capabilities in the past two years.
With 73% of retail organisations saying they have the digital capabilities required for transformation, up from 37% two years ago. Retail has surpassed all other sectors in terms of digital and leadership capabilities.
After retail, the telecom sector follows with 71% of organisations saying they have the digital capabilities required. Telecom operators are reshaping the consumer value proposition by creating full-fledged digital experiences.
The automotive sector leads in terms of capability growth, having increased its digital capabilities to 69% from 32% in 2018.
Talent and culture initiatives take precedence
Capgemini’s 2018 research revealed that the people dimension was a significant barrier to digital transformation, as organisations failed to bring employees along in the transformation journey.
However, more organisations today involve employees in their digital initiatives: 63% in 2020, up from 36% in 2018.
Despite this progress, when it comes to skill building, the report found that 48% of organisations (48%) investing in building soft skills such as emotional intelligence, adaptability, and collaboration.
Besides, culture topped consistently as a barrier to successful digital transformation, the report state. For example, some organisations are not having a culture where new ideas and experimentation are valued.
Accelerating investments in sustainability is critical for digital transformation today
The report highlights that while organisations must keep their eye on factors such as customer experience, operations and business technology.
They should also put emphasis on sustainability and their broader purpose, which has become important for customers and employees alike.
Consumers are increasingly concerned about environmental footprint and climate change impact. With 78% of consumers agree that companies have a larger role to play in society beyond their self-interests.
The report found that only 45% of organisations currently are accelerating sustainability investments, projects, and commitment.
To advance their digital transformation journey further, the report recommends that organisations reinvent the employee experience, leveraging the fluid workforce and ensuring employees’ social contracts align with the digital age.
In addition, they should build robust data and platform capabilities, scale new business and engagement models. Also, embed purpose and sustainability as a core part of the business, making it part of the organisational culture and viewing technology from the twin aspects of digital transformation and sustainability.
“The continued rapid pace of technology innovation and business model disruption over the past two years – with COVID-19 forcing many companies to reinvent themselves – has possibly driven this advancement,” said Claudia Crummenerl, MD – People and Organisation, Capgemini Invent.
While they have progressed on a wide variety of measures across areas such as customer experience, operations, business and technology. Crummenerl pointed out that many are still challenged to incorporate purpose and sustainability into their transformation strategies.
She emphasized on reinventing the employee experience and ways of working, embedding purpose into the operating model. This will help them in truly becoming a data-powered enterprise and scaling new business models beyond the pilot stage.
“Organisations can attain digital maturity and show resilience required to adapt to future uncertainties,” concluded Crummenerl.