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2016


Many companies are responding to an increasingly digital market environment by adding roles with a digital focus or changing traditional roles to have a digital orientation. The list of “digital” business roles and functions is extensive and growing. There are now digital strategists, chief digital officers, digital engagement managers, digital finance managers, digital marketing managers, and digital supply chain managers, among other positions.

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Despite the proliferation of digital roles and responsibilities, most executives recognize that their companies are not adequately preparing for the industry disruptions they expect to emerge from digital trends. Nearly 90% of respondents to a 2015 global survey of managers and executives conducted by MIT Sloan Management Review and Deloitte1 anticipate that their industries will be disrupted by digital trends to a great or moderate extent, but only 44% say their organizations are adequately preparing for the disruptions to come.

Preparing for a digital future is no easy task. It means developing digital capabilities in which a company’s activities, people, culture, and structure are in sync and aligned toward a set of organizational goals. Most companies, however, are constrained by a lack of resources, a lack of talent, and the pull of other priorities, leaving executives to manage digital initiatives that either take the form of projects or are limited to activities within a given division, function, or channel.

Despite this, some companies are transcending these constraints, achieving digital capabilities that cut across the enterprise. Our research found that nearly 90% of digitally maturing organizations — companies in which digital technology has transformed processes, talent engagement, and business models — are integrating their digital strategy with the company’s overall strategy. Managers in these digitally maturing companies are much more likely to believe that they are adequately preparing for the industry disruptions they anticipate arising from digital trends.

A key finding in this year’s study is that digitally maturing organizations have organizational cultures that share common features.

About the Authors:

Gerald C. Kane is the MIT Sloan Management Review guest editor for the Digital Business Initiative.

Doug Palmer is a principal in the Digital Business and Strategy practice of Deloitte Digital.

Anh Nguyen Phillips is a senior manager within Deloitte Services LP, where she leads strategic thought leadership initiatives.

David Kiron is the executive editor of the Big Ideas Initiatives at MIT Sloan Management Review, which brings ideas from the world of thinkers to the executives and managers who use them.

Natasha Buckley is a senior manager within Deloitte Services LP, where she researches emerging topics in the business technology market.


Contributors

Jonathan Copulsky, Nidal Haddad, Al Dea, Geri Gibbons, Daniel Rimm, Nina Kruschwitz, Michael Fitzgerald, Deb Gallagher, Edward Ruehle


Acknowledgments

We thank each of the following individuals, who were interviewed for this report:

Kristin Darby, CIO, Cancer Treatment Centers of America

Stephen DeWitt, CEO, Work Market

Noah Glass, founder and CEO, Olo

Richard Gringras, senior director, News & Social Products, Google

John Hagel, co-chairman, Center for the Edge, Deloitte

Chip Joyce, co-founder and CEO, Allied Talent

Jody Kohner, vice president, Employee Marketing and Engagement, Salesforce.com

Bill Macaitis, chief marketing officer, Slack Technologies

Jacob Morgan, co-founder, The Future Organization

Donna Morris, executive vice president of Customer and Employee Experience, Adobe

Michael Morris, general manager, Topcoder

Dan Restuccia, chief analytics officer, Burning Glass Technologies

Chad Sheridan, CIO, Risk Management Agency, USDA

Arun Sundararajan, professor of Information, Operations, and Management Science, Leonard N. Stern School of Business, New York University

Brian Tilzer, senior vice president and chief digital officer, CVS


MIT Sloan Management Review

MIT Sloan Management Review leads the discourse among academic researchers, business executives and other influential thought leaders about advances in management practice that are transforming how people lead and innovate. MIT SMR disseminates new management research and innovative ideas so that thoughtful executives can capitalize on the opportunities generated by rapid organizational, technological, and societal change.


Deloitte

This publication contains general information only and is based on the experiences and research of Deloitte practitioners. Deloitte is not, by means of this publication, rendering business, financial, investment or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte, its affiliates and related entities shall not be responsible for any loss sustained by any person who relies on this publication.

As used in this document, “Deloitte” means Deloitte Consulting LLP and Deloitte Services LP, which are separate subsidiaries of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. Member of Deloitte Touche Tohmatsu Limited.

Deloitte Digital is a digital consulting agency that brings together all the creative and technology capabilities, business acumen, and industry insight needed to help transform our clients’ businesses. Learn more at www.deloittedigital.com.

Deloitte University Press publishes original articles, reports and periodicals that provide insights for businesses, the public sector and NGOs. Our goal is to draw upon research and experience from our professional services organization, and that of coauthors in academia and business, to advance the conversation on a broad spectrum of topics of interest to executives and government leaders. You may contact the authors or send an e-mail to dupress@deloitte.com for more information.


References

1. As used in this document, “Deloitte” means Deloitte Consulting LLP and Deloitte Services LP, which are separate subsidiaries of Deloitte LLP. Please see www.deloitte.com/us/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.

2. “The Most Innovative Companies of 2016,” n.d., www.fastcompany.com.

3. T. Olavsrud, “How GE Will Bring the Industrial IoT to Life,” March 16, 2016, www.bloomberg.com.

4. D.A. Nadler and M.L. Tushman, “A Model for Diagnosing Organizational Behavior,” Organizational Dynamics 9, no. 2 (1980): 35-51.

5. For a discussion of the “tour of duty” for businesses, see R. Hofman, B. Casnocha, and C. Yeh, The Alliance: Managing Talent in the Networked Age (Boston: Harvard Business Review Press, 2014).

6. Harvard Business Review and Marketo, “Designing a Marketing Organization for the Digital Age,” October 2015, http://hbr.org.