The Digital Transformation Gap: Strategy vs. Execution

James Devonshire / Marketing, Tech Leave a Comment

Following on from my previous post on why digital strategies often fail, a new piece of research has caught my eye from McKinsey & Company. It focuses on whether strategy or execution is more important when organizations are trying to transform digitally.

The McKinsey research, titled The Case for Digital Reinvention, in their own words, sought to “understand the nature, extent, and top-management implications of the progress of digitization.” What it uncovered might surprise you, especially when it comes to strategy vs. execution.

So which is more important: a great strategy with average execution or an average strategy with great execution?

Well, according to the McKinsey research, “strategy wins, especially disruptive strategies that respond powerfully to digitization.”

This actually came as a surprise. The fact a strategy is determined, limited, and/or enhanced by its execution surely means the execution itself is as important (if not more important) than the strategy. After all, even the greatest strategy, which looks brilliant on paper, can fall short of the mark if it’s not executed perfectly.

Interestingly, the recent global CXO survey from HCL Technologies reveals that a massive disconnect exists between strategy and execution at global level. In fact, while 70% of organizations surveyed said they have a digital transformation strategy in place, only 10% have a full deployment plan.

It’s not surprising, then, that only a quarter of organizations surveyed said they had reaped the benefits of digital transformation.

The report from HCL also offers insights into why such a big gap between digital strategy and execution exists. One of the top reasons, cited by a staggering 89% of respondents, is that a lack of visibility into existing processes is hampering digital projects.

Preparedness for Digital Transformation

Another significant obstacle standing between digital strategy and execution – as uncovered in Commvault’s “Measuring IT’s Readiness for Digital Business” study – is that senior executives and IT departments do not seem to agree on how prepared their organizations are for digital transformation.

Despite only 41% of senior executives believing their organization is ready and understands what’s ahead in terms of innovation (already a relatively low proportion), just 29% of IT personnel share the same view. In fact, rather alarmingly, over a third of IT personnel polled said they think their senior executives would feel concerned, anxious or panicked if they had a better knowledge of the IT department. Another 16% even went as far as to say they’d be unhappy, angry or disgusted.

Lack of bandwidth (resources), lack of skillsets, lack of technology and lack of commitment to putting the organization’s vision into action were all cited by IT staff as reasons why their organizations weren’t ready for digital innovation.

The bottom line is that digital transformation is not simply a choice. Organizations can either transform themselves digitally or face becoming obsolete in their respective marketplaces.

So while the C-suite may be discussing strategies and forming a plan of attack for their digital aspirations, executing their vision may be more difficult than they anticipate, simply because they are unaware of the struggles on the ground.

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I’m a full-time freelance writer and Managing Editor at Creative Mindscape who is lucky enough to call the tropical paradise that is the Philippines my adopted home. In my spare time, I love to dabble in cryptocurrencies and play with my three young children. One’s a stressful, non-stop rollercoaster ride; the other is cryptocurrencies.