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Five ways to win at digital transformation

The heat is on for businesses that have yet to fully embrace digital models and products, but their odds of success could do with some help, write Jacques Bughin, Jonathan Deakin and Barbara O’Beirne for McKinsey Insights

It’s the top 10% of digitised companies that make up to 80% of their industries’ digital revenues, according to McKinsey research. In addition, a recent survey of some 1,700 top executives reveals that only 55% of digital transformations are likely to match profits expected.

However, having analysed the data, they say it is possible to improve results dramatically if you put the emphasis of your organisation’s transformation on digital enablement and adopt some clear strategies.

“Adhering to a well-defined set of transformation practices lifts the likelihood of exceeding profit expectations to more than 50%,” say Bughin, Deakin and O’Beirne, all McKinsey partners at various levels.

They identified the practices, listed below, that were likely to improve performance. Using all five works best, but employing just two could still improve your chances.


  1. Define which themes are most important. Prioritising elements of digital transformation that can be clearly measured in terms of business results almost doubles the chance of exceeding expectations. Excellent results also come when the C-suite pinpoints the most critical and permanent changes and form a united plan of attack.
  2. Assemble the right leaders. Digital enablement works better with exceptionally talented and experienced people at the helm – particularly a chief digital officer and a chief analytics officer. Organisations that find the right digital specialists for these roles immediately improve their capability of meeting expectations.
  3. Invest money and attention. Even when they employ good people to oversee transformation, top executives need to stay focused on digital enablement, maintaining commitment and ensuring that enough resources are reserved for the job.
  4. Commit to speed. In a competitive environment, gaining and retaining customers means keeping your eye on the fast-moving digital ball and making swift turns when necessary. Staying agile and up to date is a key element for businesses aiming to beat expected performance.
  5. Encourage people power. Employees at all levels are much more likely to embrace digital transformation – and contribute to better outcomes for your organisation – if they have specific roles and responsibilities that impact on the process and that they can be held accountable for. Individual expectations should balance with the collective at departmental and organisational levels.

In addition, the McKinsey analysis demonstrated that the best transformation results were not necessarily tied to intended company outcomes, like higher digital sales, nor did it make a difference which sector of the company was being targeted.

“The absence of clear performance relationships in those areas makes all the more striking the strength of the link between the five practices we identified and the outcomes of digital-enablement efforts,” say Bughin, Deakin and O’Beirne.

While leaders can’t control where they stand in terms of digital progress within their industry or alongside other businesses, they can be more certain of better results by adopting practices with potential for exceptional outcomes.

Author(s): Jacques Bughin, Jonathan Deakin, and Barbara O'Beirne
Publisher: McKinsey Insights