Digital Transformation Trends - Fortune 500 Companies
Four trends regarding the mindsets, methods, and philosophies regarding digital transformation for Fortune 500 companies include embracing technology as a business strategy, being forward-thinking, hiring visionary CEOs, and choosing strategic partners.
EMBRACING TECHNOLOGY AS A BUSINESS STRATEGY
- Fortune 500 companies such as BMW, CMB, and Enel have realized the benefit of embracing technology, which includes increased revenue and a secured market position.
- Technologies such as facial recognition, automated driving cars, cloud computing, internet of things (IoT), and artificial intelligence are few that are being invested.
- 27% of Fortune 500 business manage to use digital transformation strategy that is coherent and results in customer value, although it has "become an industry mega-trend."
- Some challenges faced with embracing technology as a business strategy includes the rate of change, creating coherence, increasing connection, and engagement with customers.
- Companies that are not changing with the time to become digitally enabled are at a loss because Fortune 500 companies have been facing mergers, acquisitions, and bankruptcy for over 18 years.
- Southwest Airlines began using OpsSuite to handle its customer data, replacing log books and pneumatic tubes, while Disney has put a new DevOps model in place for its digital organizational structure.
- Ford leverages big data from its customers to offer better products to them.
- Henry Schein, a wholesale supplier for dentists, has also introduced digital transformation to increase its customer base.
- To maintain competitive advantage and remain within the respective markets, it was expected that most (70%) of the Fortune 500 companies would have full-time digital transformation teams at the end of 2017.
- Breaking down silos is also a priority when the issue of becoming more customer-focused is considered and cross-department collaboration because it results in persistent issues for the companies.
- Companies need to move at a faster pace to become digitized because it leaves them vulnerable to becoming stagnant, which would cause them to lose customers and possibly fail as a business.
- Having a forward-thinking mindset will foster success for the companies because they'll require a full-scale commitment to digital transformation.
- Disney’s Director of Systems Engineering, Jason Cox, commented about forward-thinking saying, “success is when we’re able to get the technologists working with each other to embrace new ideas."
HIRING VISIONARY CEOS
- Companies are also considering the role of the CEO in gaining successful digital transformation.
- Having the right leadership will create positive changes within the respective teams and create synergy among team members who'll likely share the vision.
- For digital transformation to be successful, CEOs have to "rethink how companies execute, with new business processes, management practices, and information systems, as well as everything about the nature of customer relationships."
- Nike, for example, has selected a new Chief Digital Officer (CDO) to enhance the process of becoming digitally transformed and customer-focused.
- The company believes that it defines how consumers will experience the Nike brand moving forward. It’s an accelerator across the business, in the product through the supply chain, in analytics, and to retail.
CHOOSING STRATEGIC PARTNERS
- Many Fortune 500 companies have sought partners who can help them achieve their digital transformation goals effectively. For example, Huawei was selected as one such partner for 211 companies.
- Some challenges faced with choosing strategic partners include being unable to identify the most appropriate solutions.
- Huawei has capitalized on being the provider of new ICT solutions to its customers to effect digital transformation and share best practices.
- Fortune 500 companies have been seeking partnerships with fintech companies that help to enhance their digital transformation process. PricewaterhouseCoopers, predict an 80% partnership in the years to come.
- Acquisitions are also being made as part of the digital strategy to gain success in the digital transformation process.
- Partnerships with Huawei has led 64% of Fortune 500 companies also to explore digital transformation, with 197 of them being partners out of 500.
- Huawei is a top choice as a partner because of being the top ICT provider. The company has one of the largest server distributor, cloud computing package, and its differentiation platform and ecosystem.
The research team used several sources such as CIO, the Digital Transformation People, McKinsey, Workato, Forbes, Good Time, and Medium to complete the request. We selected common discussion themes/trends about digital transformation and/or strategy from all the sources, that is, they appeared at least four times or frequently cited across sources. These were then used to create titles for the observed themes, to present the four trends, regarding the mindsets, methods, and philosophies regarding digital transformation for Fortune 500 companies.