New research reveals that companies with a digital transformation plan set in place are the ones raking in the most cash annually, compared to regular organizations that use traditional tools and methods to do business. It’s not the first time a market study reveals this, but then why isn’t everyone doing it? Simple: because it takes technology-literate executives to drive these initiatives. And they don’t grow on trees.
The study, conducted by Freefrom Dynamics, has produced a measurement tool capable of assessing the digital effectiveness of companies worldwide, showing the impact that digital investments have on a company’s bottom line. The Digital Effectiveness Index (DEI) reveals that the companies achieving high returns from digital investments drive the most market disruption, securing them as “digital distruptors” in the study.
The major finding was that, on average, digital disruptors achieve revenue growth twice as high as mainstream organizations, and 2.5 times higher profit growth.
Where does a digital growth plan take you?
The simplest answer to this question is: it takes you places. In the UK, companies who efficiently played their technological-disruption card saw growth in areas like workforce efficiency (48%), product and service development (43%) and operations and efficiency (43%).
86% of the 1,442 companies that participated in the study said they had either seen or anticipated revenue growth, 85% noted customer retention as an area that benefited the most from digital investments, and 69% reported new inroads (business opportunities) thanks to their efforts in this area.
Globally, the United States leads the pack in tech innovation among companies big and small. 26% of North American companies were identified as digital disruptors in the DEI, followed by India (25%), UK (14%), Germany (14%), France (8%) and Italy (4%).
Business savvy means tech savvy
This isn’t the first time that we stress the importance of having technically-educated leaders, and it’s probably not the last either. But don’t just take our word for it.
About a year ago, Inc.com published a piece titled “Why Tech-Savvy CEOs Rule the World,” enumerating some of the biggest names in business as being computer-literate types. From Jeff Bezos and Mark Zuckerberg to Bill Gates and Larry Page, every name on that list possessed a deep understanding of the technological underpinnings of their business. According to the report, this aspect alone is enough to determine whether or not a company will be able to stay ahead of the curve, or fall to obscurity. This is also visible with the naked eye. Just check the market value of other companies founded and / or led by tech aficionados.
At 4PSA, we develop cloud-based communication systems – all designed to enable fledgling business models, but also long-established institutions, to stay relevant in today’s competitive world. The future is digital, and so we’ve made it our business to make that future bright not just for ourselves, but for everyone else.
You don’t have to be Microsoft, IBM, or Apple to understand that technology, now more than ever, plays a crucial role in making or breaking a business. You can’t reach new audiences by ignoring technology (i.e. social media) in the same way that you can’t cross a torrent without a solid raft and a helmet. Bottom line: making sure you have a high digital IQ is one of the best things you can do for your business – not just in the technology world, but anywhere.