Democratizing Transformation

An important article from Marco Iansiti and Satya Nadella on the different elements of digital transformation. Definitely worth a read.

Many companies struggle to reap the benefits of investments in digital transformation, while others see enormous gains. What do successful firms do differently?

This article describes the five stages of digital transformation, from the traditional stage, where digital and technology are the province of the IT department, through to the platform stage, where a comprehensive software foundation enables the rapid deployment of AI applications.

The ideal is the native stage, whose hallmarks are an operating architecture designed to deploy AI at scale across a huge, distributed spectrum of applications; a core of experts; broadly accessible, easy-to-use tools; and investment in training and capability-building across the enterprise.

In particular……

We looked at 150 companies in manufacturing, health care, consumer products, financial services, aerospace, and pharma/biotech, including a representative sample of the largest firms in each sector. Some were failing to move the needle, but many had made dramatic progress. Perhaps surprisingly, we found that outcomes did not depend on the relative size of IT budgets. Nor were the success stories confined to “born digital” organizations. Legacy giants such as Unilever, Fidelity, and Starbucks (where one of us, Satya, is on the board)—not to mention Novartis—had managed to create a digital innovation mindset and culture.