Gartner survey shows digital business leaders are pulling ahead of the pack

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Gartner says a widening gap is forming between organisations already undertaking digital business initiatives versus those only in the planning stage.

A recent Gartner survey found that 32 per cent of leaders at organisations with $250 million or more in annual revenue says they have a business that is a digital business, up from 22 per cent in the same survey last year.

Gartner says it fielded 304 surveys in the US, UK, Germany and Australia between May and June 2015, as part of its 2015 Digital Business Survey of IT, Business and Marketing Executives, in order to understand how businesses and institutions take in, identify and exploit the new opportunities that digital business represents.

"The survey results underlined how digital business leaders are more likely than others to focus on design and the creation of new digital business moments," says Jorge Lopez, vice president and distinguished analyst at Gartner.

Gartner defines digital business moments as catalysts that set in motion a series of events and actions involving a network of people, businesses and things that spans or crosses multiple industries and multiple ecosystems.

"We asked respondents to rank the importance of five success factors, breaking down the results according to whether companies were using digital marketing techniques (a precursor to digital business), were planning digital business or had already implemented digital business. Not surprisingly, the last group accorded more importance to design and moments, which are necessary to execute digital business."

"Digital business moments of untapped opportunity and competition can rapidly change the dynamics across industries," says Patrick Meehan, research vice president at Gartner. "As such, the successful design and development of business moments, which the company can replicate, are the most significant undertaking an organisation working to become a digital business can take. Innovative companies are tailoring digital business moments to complement their existing products and services."

Digital business leaders are more likely than others to focus on design and the creation of new digital business moments.Jorge Lopez, Gartner

The survey also revealed that most companies undertaking digital business initiatives don't make a distinction between digital business strategy and business strategy — to this group, they are the same or integrated with the main business strategy.

Those in the planning phase see the two as separate. In practical terms, a company that is moving from strategy to execution will have fewer steps to reach its goals compared with one that has to insert a separate planning process for digital business. Over time, even if the faster team stumbles, it can recover more rapidly than one that has more process for strategy.

Other survey results show that executives already in digital business are invested in piloting and deploying, while those at companies in the planning phase are focusing on investigation and experimentation.

The top priority for digital business front-runners is adopting new technology (70 per cent). The next highest priorities — creating a highly collaborative environment (56 per cent) and supporting customer-driven technology change (53 per cent) — represent responses to an external stimulus and are characteristic of a healthy digital business.

When asked to identify what would be the impact of digital business — either positive or negative — over the next five years, organisational leaders overwhelmingly concurred on the upside, anticipating improvements in customer experience and engagement (86 per cent), IT organisation (86 per cent), workforce productivity (84 per cent) and sales organisation (83 per cent). Organisations appear to anticipate little downside to digital business with just 7 per cent projecting a negative or significant negative impact in staff, and 6 per cent in mergers and acquisitions.

"The disruptive effects of digital business cannot be underestimated," says Lopez. "To date, a limited number of product categories — music, books, photographs and newspapers — have seen their business models upended."

In the future, he says, "Organisational leaders in other product and service categories will need to adapt by restructuring the workforce, eliminating obsolete roles, and finding talent that can help design systems and workflows that optimise the use of things integrated with people and business to drive new value for customers."

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Copyright © 2015 IDG Communications, Inc.

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