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The seven decisions that matter in a digital transformation:
A CEO’s guide to reinvention
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Is your company performance average,
or worse? If so, you’ll need bold moves
to jump into the top quartile of performance.
Reinvent yourself
De-risk by making fixes without
exposing significant parts of the business
Deliver capabilities needed to meet strategic goals
Design business processes with close attention to customer experience, IT requirements, and organizational factors
Discover industry-level insights needed to identify sources of disruption
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The case for digital reinvention
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The average- and bottom-performing quartiles will feel the most pain as digital further separates winners from losers.
Feeling it
1
1
Average
–6.0%
Average
–4.5%
+0.8%
–6.4%
–2.2%
–7.7%
Top
quartile
Bottom
quartile
Change
in EBIT
growth
Change in
revenue
growth
Annual change at current level of digitization
Estimated based on survey responses and McKinsey analysis.
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Full
digitization
Current
digitization
Revenue
EBIT
–12.0%
–6.0%
–10.2%
–4.5%
What happens once industries digitize fully?
New entrants and increased competition drive down revenue and profit growth.
Declines ahead
Companies and industries are slower to go digital than
you might think. As of 2016, industries were on average only 40 percent digitized, according to survey responses.
Going digital ... slowly
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Retail
55%
Travel, transport, and logistics 44%
Automotive
and assembly
32%
High tech
54%
Telecom
44%
Professional
services
42%
Media and entertainment
62%
Healthcare
systems and
services 51%
Financial
services
39%
Consumer
packaged goods
31%
No
change
Minor
secondary
change
Some core
change
Digital
reaching
mainstream
Dominantly
digital
Fully
digitized
100%
0%
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What does the digitization of industries mean
for future revenue and profit growth? The findings
are bad news for average companies.
The digital effect
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