Digital technology is widely reported to have only just begun to infiltrate our Industries. As it continues to gather momentum, the effects for revenues, profits, and opportunities will be extensive.
As new markets emerge, profit pods shift, and digital technologies become part of the course of every day life, it’s easy to assume that the economy’s digitisation is already far advanced. According to McKinsey research though – “the forces of digital have yet to become fully mainstream.” On average, industries are less than 40 percent digitised, despite the relatively deep penetration of these technologies in media, retail, and high-tech.
IT Distribution : Revolution of Evolution ?
It can be called digital transformation, or ‘diversification’ and flexibility – just like their own vendors, distributors are being pushed into a corner to re-look at re-inventing their current / older business models as they look for a competitive edge or to simplify, lower costs, maintain profitability – its debatable though that it’s really just another step in what we also call the constantly evolving of this vibrant and vital sector?
Whats envisaged for digital reinvention
As digitization penetrates more fully, it will dampen revenue and profit growth for some, particularly the bottom quartile of companies, according research, while the top percentage captures disproportionate gains. Bold, tightly integrated digital strategies will be the biggest differentiator between companies that win and companies that don’t, and the biggest payouts will go to those that initiate digital disruptions. Fast-followers with operational excellence and superior organizational health won’t be far behind.
These findings emerged from various research efforts to understand the nature, extent, and top-management implications of the progress of digitisation. The research tailored efforts to examine effects along multiple dimensions: products and services, marketing and distribution channels, business processes, supply chains, and new entrants at the ecosystem level . They sought to understand how economic performance will change as digitisation continues its advance along these different dimensions. What are the best-performing companies doing in the face of rising pressure? Which approach is more important as digitisation progresses: a great strategy with average execution or an average strategy with great execution?
McKinsey’s research supports to act decisively whether through new digital businesses or by reinvention of today’strategic, operational and organisational approaches.
More digitisation and performance pressure ahead!
Speaking to Clients and Candidates alike this year, the impact on the economic performance of companies, while already significant, is far from complete – there is a lot of work to be done – frustrations to be had and money to spend !
