5 ways leading organizations excel at digital

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With technology integral to business strategy, leading organizations are rewriting the rule book for success. In Deloitte’s 2018 global CIO survey, we identified these digital vanguard organizations as having two distinct attributes: a clearly defined digital strategy and an IT organization viewed by the business as a leader in harnessing emerging technologies and building digital capabilities. Only 9.7 percent of global technology organizations fit this bill.

In survey interviews, we discovered that these digital vanguards differed from other organizations in terms of their priorities, mindsets and cultural attributes. Here is what sets them apart:

1.   Growth mindset

Operational stability is expected of any IT organization, but once it is achieved, digital vanguards quickly shift focus to driving transformation and delivering top-line growth. In fact, for 62 percent of them, transformation and growth is their primary mandate. We also found that digital vanguards are less afraid of failure and more likely to fund business innovation, spending 26 percent of their technology budgets on innovation compared with 18 percent for others.

With technology and business dynamics changing rapidly, many tech leaders feel it is almost impossible to commit to a three- or five-year plan, yet they do. Digital vanguard organizations have solved this dilemma by taking a zoom-in/zoom-out approach, simultaneously focusing on working with their business peers on two very different time horizons: six to 12 months (zoom in) and 10 or more years in the future (zoom out). This process provides the clarity and flexibility that allows these organizations to address immediate business needs while building a broader business vision and purpose.

With technology integral to business strategy, leading organizations are rewriting the rule book for success. In Deloitte’s 2018 global CIO survey, we identified these digital vanguard organizations as having two distinct attributes: a clearly defined digital strategy and an IT organization viewed by the business as a leader in harnessing emerging technologies and building digital capabilities. Only 9.7 percent of global technology organizations fit this bill.

In survey interviews, we discovered that these digital vanguards differed from other organizations in terms of their priorities, mindsets and cultural attributes. Here is what sets them apart:

1.   Growth mindset

Operational stability is expected of any IT organization, but once it is achieved, digital vanguards quickly shift focus to driving transformation and delivering top-line growth. In fact, for 62 percent of them, transformation and growth is their primary mandate. We also found that digital vanguards are less afraid of failure and more likely to fund business innovation, spending 26 percent of their technology budgets on innovation compared with 18 percent for others.

2.   Zoom-in/zoom-out perspective

With technology and business dynamics changing rapidly, many tech leaders feel it is almost impossible to commit to a three- or five-year plan, yet they do. Digital vanguard organizations have solved this dilemma by taking a zoom-in/zoom-out approach, simultaneously focusing on working with their business peers on two very different time horizons: six to 12 months (zoom in) and 10 or more years in the future (zoom out). This process provides the clarity and flexibility that allows these organizations to address immediate business needs while building a broader business vision and purpose.

3.    Culture that attracts top talent

Almost every CIO we talked to in the past year was looking for new talent and finding ways to reskill their existing workforce, and many noted the difficulty of hiring and retaining high-performing talent. Digital vanguards have the same challenges but realize organizational culture is key to attracting, retaining and engaging top technology talent. Fifty percent of digital vanguard organizations say they have a reputation for being an innovation leader, whereas only 20 percent of baseline organizations say the same. More than half (55 percent) say they are able to retain talent because of their creative and inspiring environments.

4.   Solid technology foundation

Digital vanguards have an innovation agenda and inspiring cultures, but it would be a mistake to think they skimp on investing in strong, resilient technology platforms and environments. In fact, we found that they are much more likely to view cybersecurity as a strategic imperative and consider it key to delivering technology capabilities. More than half (52 percent) rate their cybersecurity capabilities as “comprehensive,” compared with only 26 percent for others. The majority of vanguards (78 percent) are confident that their architectures will support future business needs. This zoom-in perspective is nicely complemented with a corresponding zoom-out view: Seventy-two percent are already investing in artificial intelligence and machine learning with an eye toward the future.

5.   A strong engagement plan

As a result of IT’s historical back-office role, technology organizations have typically had strong relationships with other back-office functions like operations and finance and weaker relationships with sales, marketing and product engineering.  Digital vanguards break that mold: Seventy-four percent say their IT function has very strong relationships with sales and 64 percent say the same about marketing — much higher than other survey participants. Instead of developing complex and elaborate governance structures, they spend a majority of their time understanding business needs and creating agile engagement models, organizational structures and processes that enable them to co-create business solutions.

Digital vanguard organizations are by no means perfect, nor have they completed their transformations. But based on our analysis, they seem to be moving in the right direction and can offer learnings we can use to develop our own zoom-in/zoom-out approaches in 2019 and beyond. 

This article first appeared in the Winter 2019 digital issue of CIO magazine.

This story, "5 ways leading organizations excel at digital" was originally published by CIO.