Digital and social strategy in 2016
Private company issues and opportunities
Social media is becoming an increasingly important business tool for private companies, yet many early adopters lack a clear digital strategy. Competing priorities—invest in cyber protections or customer experience?—can also hinder progress. Companies that “crack the code” will gain an advantage with customers and talent alike.
Companies use social media to recruit new talent, promote their products or services, and boost their executives’ standing as industry thought leaders. The increasingly mobile-powered networks form part of a broader focus on technology that has the potential to make strong companies excellent, particularly when a clear digital strategy is in place. In Deloitte’s fourth annual research study with MIT Sloan Management Review, based on a survey of more than 4,800 executives and managers, 76 percent of respondents said digital technologies are important to their organizations today.1
76 percent of survey respondents said digital technologies are important to their organizations today
Questions persist about how well private companies are employing digital technologies for business gain. In the MIT SMR and Deloitte study, only 15 percent of respondents from public and private companies in the early stages of digital maturity—where the digital agenda truly has transformed the business—say that their companies have a clear, coherent digital strategy. More than half of early stage companies overall cite the absence of a digital strategy as the biggest barrier to digital maturity.2
Competing priorities also get in the way of digital and social strategy and execution, particularly as companies move up the maturity curve and wrestle with concerns such as cyber threats.3 A growing financial services firm may need to assign resources to fend off hacker attacks, but it cannot ignore the fact that many customers, particularly millennials, actually prefer to interact through social channels.4 Talent is another area where companies that lack comprehensive digital strategies stand to lose out to competitors.
“Companies developing enterprise-level digital strategies are moving ahead, while those that aren’t are struggling,” says Doug Palmer, principal at Deloitte Consulting LLP. “Digitally maturing companies embrace innovation and collaboration, and have leaders who understand both technology and its potential impact on the business.”
Only 15 percent of respondents from public and private companies in the early stages of digital maturity say that their companies have a clear, coherent digital strategy
Revamping the customer experience through social and digital initiatives should be an important goal for companies. Banking, insurance, and travel represent just a few sectors that rely on a high volume of customer orders and inquiries. These industries can improve customer interactions by making digital communication a core component of those relationships. A passenger who has an unfavorable episode with an airline may not call to complain, but instead post their discontent on their social channels. Likewise, a happy client might share a positive experience with their social networks. This shift in power, in which customers can significantly impact a company’s reputation, means brands have to take digital steps to manage the experience.5
Storytelling across social and digital channels is another practice that private companies should continuously hone in order to boost their competitive advantage. That includes internal efforts, such as the use of stories oriented to employees in order to promote company initiatives.6 MIT SMR and Deloitte’s research also notes the efforts of a manufacturing company that partners with the University of Southern California to improve its storytelling capabilities for external audiences, creating the types of stories that will help customers better understand its innovations.
Companies also should understand how to apply insights from data to their decision making. In industries such as health care, for instance, data proficiency is changing the delivery of services, helping physicians and other medical staff secure a more informed view of health risks.
Finally, private companies also have an opportunity to win the war for talent if they can construct a company culture that demonstrates that it values, supports, and nurtures digital proficiency. In the MIT SMR and Deloitte survey, among respondents in age groups ranging from 22 to 60, an average of nearly 80 percent said they want to work for a digitally enabled company or a digitally focused leader.7
Industries can improve customer interactions by making digital communication a core component of those relationships.
Questions to consider for 2015
- Do you have a clear view of the digital technologies that are disrupting your industry?
- Do you have a digital strategy that goes deeper than implementing technologies currently on the market?
- Does your company encourage risk-taking and foster digital initiatives?
- Are you confident in your leaders’ digital fluency? If not, how can you work to improve it?
1 Gerald C. Kane, Doug Palmer, Anh Nguyen Phillips, David Kiron and Natasha Buckley, “Strategy, not Technology, Drives Digital Transformation,” MIT Sloan Management Review and Deloitte University Press, July 2015, http://dupress.com/articles/digital-transformation-strategy-digitally-mature/
2 Kane, Palmer, et al., “Strategy, not Technology, Drives Digital Transformation,” July 2015.
3 Kane, Palmer, et al., “Strategy, not Technology, Drives Digital Transformation,” July 2015.
4 Carlos Dominguez, “Moving from customer marketing to customer experience,” blog posting, accessed February 8, 2016, http://www2.deloitte.com/us/en/pages/deloitte-growth-enterprise-services/articles/moving-from-customer-marketing-to-customer-experience.html.
5 Dominguez, “Moving from customer marketing to customer experience.”
6 Kane, Palmer, et al., “Strategy, not Technology, Drives Digital Transformation,” July 2015.
7 Kane, Palmer, et al., “Strategy, not Technology, Drives Digital Transformation,” July 2015.