Delivering sustainable competitive advantage has long been the cornerstone of business strategy. But, as the digital economy continues to develop, maintaining a leadership position in the marketplace, or even simply keeping up, can seem more difficult than ever. Add to this a myriad of technologies converging at an exponential rate, reshaping business models overnight and it can seem as if a sustained advantage is impossible to come by.
Is sustainable competitive advantage a myth then in the digital age? Possibly, in its traditional sense. Today, the only way for most organisations to sustain their competitive advantage is to be prepared to embrace continuous digital transformation to meet new pressures, keep pace with competitors and take advantage of new technologies.
“…digital represents and offers a completely different portfolio of economics. Digital makes the expensive cheap and changes the time consuming to real time.” - Michael Schrage, MIT
The new digital economy represents a paradigm shift and its impact on competition is profound. The new advantage is drawn from an organisation’s ability to adapt to the rapidly shifting competitive environment. Leaders in the digital economy are now defined by their ability to transform, to take advantage of these changes, to learn, react and respond, not just once, but continuously.
If the prospect of reading a piece on digital transformation brings on chills and flashbacks to slow and painful transitions from deep and ingrained legacy systems, you’re not alone. The history of IT transformation as it was once known, is littered with tragedies, of over time, over budget projects which fail miserably in the achievement of their objectives. McKinsey data from 2013 even suggested some 70% of large-scale transformations fail in achieving their stated goals.
As the new rules of the new digital economy emerge, it is becoming clearer and clearer that the old mode of digital transformation has had its day. New entrants in the market place are arriving as digital natives, businesses built on the latest technology and in most cases, ready to adapt to the new opportunities as they emerge.
How then to compete? Organisations large and small should embrace digital transformation as not simply a requirement but as an opportunity. By embracing digital transformation and building a framework in which transformation is encouraged, then organisations can use transformation to continually seek new forms of competitive advantage.
We see digital transformation this way, but we can understand if you don’t. We see and hear about some fundamental mistakes being made on a whole range of projects by suppliers who should know better.
We’ve continued this train of thought in our latest white paper, entitled “What Every CEO Needs to Know about Digital Transformation”. We expand on the importance of digital transformation, identify some of the major pitfalls and explain the steps we at Razor go through to ensure that each and every project achieves its aims.
We think digital transformation is more than an opportunity but an absolute imperative for businesses looking to keep pace with the astounding rate of change we’re seeing.