It’s a recognized fact that digitization is linked to business growth—just have a look at Accenture’s Digital Innovation Survey for all the details.
But when it comes to actually applying these digital principles to their own operations, not all businesses—even successful ones–are created equal.
For several years, Accenture has been tracking the performance of the top-performing businesses in Switzerland, Germany and Austria, with similar analyses in discussion for the Netherlands, France, Turkey, and the Nordics.
In “Courage to think differently: Digitization strategies of Germany’s Top 500,” we examine how Germany’s top-performing companies are integrating digitization into their business models. Our analysis looks at how the Growth Champions (companies with an above-average success rate) stand out from the other Top 500 companies in the areas of media, communication, automotive, high tech, services, engineering and more.
Although financial service companies, including insurers, were deliberately excluded from the German study, the results provide a clear picture of how the top-performing companies in the country are adopting digital strategies as a key differentiator.
Digital technologies provide the foundation for widespread innovation of business models, products and services. Combining physical assets with data from the online world reveals completely new perspectives on customer approach, product enhancement, and improvements in research and development. Companies that can handle large data volumes, something that was impossible only a few years ago, have an enormous edge on their competitors.
However, while the chief information officers, chief digital officers and strategic managers of top German companies recognized the significance of digital technologies—only one in five companies expected little or no effect of digitization on their business– there is frequently a lack of comprehensive strategies and leadership to successfully implement digitization.
The study investigated the extent to which companies are considering digitization and using digital solutions to spur growth using the Digitization Index. This is an analytical tool that measures the progress companies have made in digital strategies, digital services and digital enablement. We then divided these three indicators into subcategories and assigned a grade for each on a scale from 4 (highly digitized) to 1 (minimally digitized). The average of these three indicator grades forms the Digitization Index value.
Overall, the Top 500 German companies increased their index value by 9.8 percent, with the biggest increase in digital enablement, at 14.3 percent, showing that the Top 500 primarily use digitization to improve internal efficiencies and cut costs. In the area of digital strategies and digital services, the index increased by 6.5 percent and 9.7 percent respectively.
While this represents a good start, these companies are still a long way from fully realizing the benefits of digitalization. Next week I’ll continue our discussion of the German study with a look at the roadblocks to digitization and how a comprehensive strategy can move the needle on implementation.
To view the study, go to:
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