A significant number of companies are still struggling to implement a clear digital strategy into their business as digital technologies constantly change the market.
This is the key finding from the Massachusetts Institute of Technology Sloan Management Review and Deloitte Digital.
The sixth annual study found that mature companies are more than four times likely as less mature or early stage businesses to have a clear and coherent digital strategy in place.
The report revealed that companies are increasingly breaking down the divide between digital and traditional business structures, adopting a 'cross-functional' approach to working.
“Cross-functional working is key, yet many organisations still have their structures divided between 'digital' and 'traditional’, which is a problem,” said Deloitte Digital's leader in Australia, Steve Hallam.
The report found that 77 per cent of digitally-maturing businesses recognise and reward collaboration and cross-functional teams as a cornerstone of how they operate, versus slightly more than 34 per cent of early-stage entities
“Equally important, operations need to become more cross functional to fully support customers’ digital experiences,” Hallam said.
Insurance giant MetLife was identified as an example of an established business identified in the report that was making inroads in achieving digital success throughout its organisation.
Part of this success was the insurer’s adoption of a cross-functional approach to working.
The importance of working cross-functionally has become so important at MetLife that the company is training its hiring managers in behavioural-based interviewing skills to ensure that new hires have the requisite cross-functional abilities needed to get work done.
The report found that digital strategies aren’t limited to technological issues such as using mobile. Instead, they chart how the organisation can and should do business differently as digital technologies change the market.
Cross-functional working is key, yet many organisations still have their structures divided between 'digital' and 'traditional’, which is a problem
MetLife executive vice president and head of global technology and operations Martin Lippert was interviewed in the report and spoke about the challenge.
He said that there were four pillars that make up MetLife’s strategy – “which aren’t themselves digital”.
The first is optimizing value and risk. The second is delivering the right solutions for the right customers. The third is strengthening our distribution advantage. And the fourth is driving operational excellence.
Lippert wants the insurer to think of these pillars with a digital mindset in order to improve the customer experience and make the organization as efficient and effective as possible. As he puts it: “Digital sits in the middle of these four pillars and brings them all together.”
To instil the company with a digital mindset, Lippert focuses on all parts of the business including the executive team.
To boost digital thinking on the part of senior management, he recently took several top executives and other senior leaders to Silicon Valley to meet with venture capital executives in whose companies MetLife has invested. The company has also partnered with technology companies, startups, and universities to bring new ideas and approaches into executive offices.
To drive ideas from the bottom up, MetLife hosts an annual event called MetLife Ignition. At the company-wide gathering, portfolio companies from the venture capital companies in which MetLife invests in, present ideas to employees.
The event stimulates new ideas that often move into proof-of-concept and, if preliminary results hold, are eventually rolled out globally.