In the 2019 Digital Business Report, MIT SMR and Deloitte’s survey analysis and executive interviews unveil the distinctive characteristics of innovation in digitally maturing organizations. Ecosystems and cross-functional teams allow them to be agile, but this increased agility demands a thorough consideration of governance as well.

Most of us know Moore’s law, that the power of semiconductor chips grows exponentially, not linearly, over time. Moore’s law, though, is only part of the technology equation. There’s another critical law that needs more attention. It’s this: While technology changes quickly, organizations change much more slowly. That means digital transformation is as much a leadership challenge as a technical one.

In recent years, a handful of Chinese companies like Alibaba, Haier, and Tencent have garnered a lot of attention as they have emerged as global innovators. They are challenging the R&D strategies of foreign companies and offering lessons on how to make ideas commercially viable. But there’s another, less obvious force to be reckoned with in China: thousands of innovative companies that are quietly disrupting numerous industries and developing new products and new business models.

Digitization opens opportunities for the world’s sustainability challenges, but it also transforms industries, holding out the possibility of dramatically improving their social and environmental performance. To capitalize on this development, an emerging area of opportunity is the digitization of physical products and production.

By many rights, one might have expected to find Adobe on the register of companies disrupted by digital. And yet the 35-year-old software developer has persevered by embracing the very technological forces ― think cloud, mobile, platforms, IoT ― that could have meant its demise. The result? This legacy producer of packaged software designed for the desktop is thriving.

Many companies experiment in digital business. What matters is what they do with the results of those experiments.

According to a 2018 NewVantage Partners survey, executives now see a direct correlation between big data capabilities and AI initiatives. For the first time, large corporations report having direct access to meaningful volumes and sources of data that can feed AI algorithms to produce a range of business benefits from real-time consumer credit approval to new product offers.

Digital transformation is top of mind for many organizations. But many flounder by focusing more on developing the next technology breakthrough — when a core component of a winning digital transformation strategy is cultivating the talent who will lead the effort.

In an interview with MIT SMR, Cardinal Health’s Brent Stutz describes how the company’s three-year-old innovation center, Fuse, uses a “fail fast and often” mindset toward innovation. “Our innovation process has three phases: explore, experiment, and then pilot. We have an opportunity to pull the plug at any time… I’m not afraid to try 42 things and only have six make it out the other end,” Stutz says.

On March 15, 2017, MIT SMR held a webinar to share insights from our report, “Analytics as a Source of Business Innovation.” Many participants asked questions during the webinar that we didn’t have time for, so we decided to answer them in blog format instead. This post is the second set of responses.

On March 15, 2017, MIT SMR held a webinar to share insights from our report, “Analytics as a Source of Business Innovation,” which summarizes our findings about the increased ability to innovate with analytics and its benefits across industries. Many participants asked questions during the webinar that we didn’t have time for, so we’ll answer some of them in blog format instead.

In business, it’s costly to try something new, especially if it doesn’t work out. But in the digital era, technology can be deployed to augment the creative abilities of people and organizations. Today’s digital technologies have reached a level of maturation that enables cheap and rapid iteration to make new, invaluable forms of innovation possible.