The forces of digitization are advancing fast—and so is the case for digital reinvention. This issue’s lead article presents new research showing just how pressing it’s become to shake up your core and seize new digital business opportunities. Through a combination of survey data, sophisticated statistical analysis, and modeling, McKinsey’s Jacques Bughin and his coauthors show that in many sectors, digital’s reach hasn’t extended as far as we might think. As it continues to advance, the gap between digital leaders and laggards is poised to expand, along with new opportunities for digital differentiation in areas such as supply chains that aren’t yet a top priority for many companies.
Also presented here are several views from the front lines of digital reinvention. The CEO of LEO Pharma, Gitte Aabo, describes the work of a new innovation lab developing digital solutions for patients. Citigroup’s Head of Technology and Operations explains what it takes to mobilize change, as do the CIO and former COO of ING Netherlands, which has reorganized itself to be more agile. Complementing these perspectives are snapshots of McKinsey research on the pace and nature of digital change in the banking, food-retail, and pharmaceutical sectors, as well as a framework for structuring digital transformation through discovery, design, delivery of digital capabilities, and de-risking of the change process.
The need for digital reinvention throughout the organization is underscored by two other articles. In “The new battleground for marketing-led growth,” our colleagues David Court and Dave Elzinga revisit the consumer decision journey framework they presented first in the Quarterly back in 2009. Their latest research reveals that the often irregular paths followed by consumers as they move from brand awareness through to purchase and loyalty have become more “front loaded” because digitization makes it so much easier for consumers to shop around. Stimulating initial consideration, with all the tools that marketers have at their disposal, is therefore growing in importance. Those tools have been changing rapidly with digitization, and there’s much more on the way, say the authors of “A smart home is where the bot is.” In the near future, they suggest, marketers will need to target robots and algorithms that increasingly will be stitching together our homes and serving as a focal point for purchase decisions.
To keep up with the pace of change, companies need full leadership capacity at the ready. Too often, though, say the authors of “Finding hidden leaders,” companies focus on the “usual suspects” when they’re trying to match people with corporate priorities. New techniques, some technology-enabled, can help companies “hunt” for the leaders they need. Also critical is a commitment to diversity. McKinsey’s Celia Huber and Sara O’Rourke describe how leading companies are making good on such commitment as they raise the number of women on their boards. For many other companies, a new playbook is needed to achieve greater gender diversity, say Dominic Barton, McKinsey’s global managing partner, and Lareina Yee, a senior partner. We hope this issue of the Quarterly helps you enhance your own playbook and stay ahead of your biggest challenges.
Download the full issue of McKinsey Quarterly 2017 Number 1 (PDF–3.28MB).