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Leadership / Digital Transformation

A data-driven approach to digital maturity

Monitoring their maturity can help technology leaders justify continued investment in digital transformation.

Investment in digital transformation is predicted to grow at staggering rates. IDC predicts that global spend will reach $6.8trn by 2023 and that 65% of the world’s GDP will be digitised by 2022. With such huge sums at stake, investors will need reassurance that the proposed returns will materialise.

This is an added pressure for digital transformation leaders, who must also contend with the IT productivity paradox, the tiresome task of business case development, and adjusting plans as priorities change. Then there is the expectation for a never-ending transformation programme, complicated by so many new and untested digital technologies.

What is digital maturity?
London-based start-up Deltabase has created a comprehensive and industry-agnostic digital maturity assessment framework. (Photo by Nako Photography/Shutterstock)

The need to provide reassurance and forward visibility in the face of constant evolution requires these leaders to focus on three factors. Firstly, reducing guesswork when planning investments; secondly, making sure the transformation programme remains on track; and thirdly, ensuring that newly delivered capabilities are relevant to achieving original aims and, ultimately, drive competitive advantage.

What is digital maturity?

This is where a relatively new approach to assessment and continued justification for digital transformation expenditure comes into its own: digital maturity.

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While the concept of digital maturity has been with us for some time now, there are very few companies applying it; and those that do are unlikely to share the outcomes of their assessments.

The first hurdle is agreeing on a single pragmatic definition for digital maturity. Advisers and consultants argue that each digital maturity framework is unique and contingent on the organisation planning to adopt it. But is that true?

As long ago as 2016, researchers suggested that digital maturity was simply the status of a company’s technology-induced change. However, ambiguous, techno-centric definitions such as this failed to capture the enterprise-wide impact of digital technology adoption and exploitation. Poorly equipped to plot and track planned changes to multiple aspects of the business, digital transformation leaders lacked the language to reassure the board and their investors.

London-based start-up, Deltabase, has sought to address this shortcoming by creating a comprehensive and industry-agnostic digital maturity assessment framework. After an exhaustive study of existing frameworks, and a ‘validation and development’ assessment exercise on the FAANG (Facebook, Apple, Amazon, Netflix, and Google) peer set, Deltabase set about benchmarking the digital maturity of some of the world’s leading companies across multiple industries.

“Companies need to consider three basic questions before completing a digital maturity assessment,” explains Deltabase CEO Phil Spratt. “First is what the scope of the assessment should be – in our view, digital maturity assessment should not be merely confined to digital sales and marketing activities but should encapsulate all aspects of the business operating model.”

“For our clients, the next two key questions are ‘what we benchmark our digital maturity against?’ and ‘where we set the target future state?’” Spratt continues. “Are companies looking to be world-class, sector-leading or just to close the gap with their industry average? Each of these can come with a very different profile of investment.”

Deltabase assesses digital maturity against six factors, comprising 30 dimensions. Gathering data from up to five million datapoints, using techniques proved in the field of defence intelligence, organisations then get a clear view of their digital maturity in less than two weeks.

This provides clients with an objective and unambiguous view of progress in relation to internal expectations and key competitors, both of which are crucial in justifying continued investment in the digital transformation journey.

Towards a data-driven approach to digital maturity

By developing deep insights into multiple industries, this data-driven approach can help organisations to not only identify their competitive shortcomings but also articulate the scale of the transformation needed.

For example, Deltabase has shown that digitally native organisations, such as direct-to-consumer e-commerce businesses, tend to have well-developed and high-performing digital shopfronts. They have a leading-edge grasp of digital marketing and they enhance the customer experience with a range of digital tools and techniques. But their back-office functions, such as supply chain, finance and HR, are often underdeveloped, with opportunities to streamline operations with digital tools such as robotic process automation.

The converse is true in more traditional sectors such as oil and gas, where the majors have broadly comparable and well-digitalised business operations. The battleground is providing a unique and rewarding omnichannel customer experience to win market share and maximise customer lifetime value.

Insights such as these not only highlight the challenges and opportunities now facing organisations, but they also provide access to best practice from other sectors.

Monitoring and assessing multiple factors and dimensions outside the IT domain, using hard data, helps digital leaders maintain focus on efficient flows of digital assets. Digital transformation leaders now have the means to benchmark their digital capabilities with the market, to articulate the case for continued investment, to identify and define the ‘starting place’ for digital transformation and the means with which to track progress against strategic digital ambitions.

This has to be good news for the board – especially in these times of constant, and unexpected change.

Professor David J Harding is a business management consultant and executive coaching professional at The Harding Method with over 25 years of IT enabled business transformation experience.