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The Four Stages Of Digital Maturity: How Does Your Organization Rank?

Forbes Agency Council
POST WRITTEN BY
Justin Grossman

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The term “digital transformation” has seemingly become embedded in the vernacular across nearly every industry. But as commonplace as the expression has become, there’s little consensus on what it actually means. As Gerald Kane, professor of information systems at the Carroll School of Management at Boston College, points out, “The overuse and misuse of this term in recent years has weakened its potency.” What’s more, many organizations that are integrating digital into their business systems are failing to create road maps to fully develop the technology across every function.

Leading a digital agency, I’ve heard frustration across every industry that digital initiatives often don't live up to expectations or hype. To overcome this challenge, marketers must realize one project or technology platform alone will not transform a business. True digital transformation (DX) requires a shift in the way organizations think and work; learning and evolution are key.

Enter the concept of digital maturity.

“In digitally mature organizations, legacy marketing systems, organizational structures, and workflows have evolved -- and in some cases been replaced -- to enable marketing to drive growth for the business,” Jane Schachtel, Facebook’s global director of agency development, told The Wall Street Journal. “Digitally mature organizations are constantly moving forward on the digital continuum -- always assessing and adopting new technologies, processes, and strategies.”

So, while many believe DX is about using the latest cutting-edge technologies to evolve current operations, that’s only scratching the surface. For example, the marketing functions of some organizations are leveraging digital technology to boost current systems and processes, but the majority have not completely streamlined, automated and coordinated these technologies into business strategies and company culture. And this has more to do with an organization's digital maturity than a reluctance to adapt.

By measuring your business’s digital maturity level, you can better understand (and accelerate) progress. Adopting new technology is a starting point, but how will it drive business outcomes? All too often, success is defined as implementation, not impact.

Case in point: in a collaborative study by Deloitte Digital and Facebook, 383 marketing professionals from companies across multiple industries were asked to rate their digital maturity. They ranked themselves on a scale from 1 to 7, evaluating 23 traits. The average score was 4.9, indicating the majority of companies surveyed were using digital tools but had not yet integrated them into their business strategies.

The Four Levels of Digital Maturity

Digital maturity is a good indicator of whether an organization has the ability to adapt and thrive or decline in the rapidly evolving digital landscape. As shown in the Deloitte/Facebook study, most organizations fall somewhere between having little to no awareness of digital transformation, and identifying DX as a need but not yet putting the wheels in motion to execute on it.

Over the years, I’ve found organizations fall into one of the following digital maturity categories:

• Incidental: Organizations with an “incidental” rating are executing a few activities that support DX, but these happen by accident, not from strategic intent. There is no, or very low, awareness of DX as a business imperative.

• Intentional: Companies in the “intentional” stage are purposefully carrying out activities that support digital transformation, including demonstrating some strategic initiatives, but their efforts are not yet streamlined or automated. The organization’s leaders have embraced DX, but their efforts are still undeveloped and have not caught on across every function.

• Integrated: Those in the “integrated” level are successfully implementing numerous activities that support DX. These initiatives are executed with high strategic intent, and for the most part are well-coordinated and streamlined. Transformative efforts have been in force long enough to show a valid business impact, and leadership grasps DX as a core organizational need.

• Optimized: Organizations in this category are few and far between, and they are considered standard-setters in digital transformation. Almost all of their activities are undertaken strategically, and most are fully streamlined, coordinated and automated. Any new technology added to the organization is easily integrated into existing systems and processes. Digital transformation has become a true component of company culture, leading to organizational agility as technology and markets shift.

How To Assess Your Organization’s Digital Maturity

The real key to assessing digital maturity is measuring your business’s ability to adapt to a disruptive technology, event, market trend, competitor or another major factor. While a truly exhaustive digital maturity assessment of your organization would most likely involve an analysis over several months, the following questions can serve as indicators and will give you an initial appraisal of where your marketing organization stands:

• Are your digital campaigns merely functional or driving true business growth?

• Do you have a cross-channel view of your customers’ behavior and engagement data, and are teams (marketing, sales, service) aligned around this data?

• Are your digital tactics giving you a strategic advantage over your competitors?

• Are new technologies efficiently and purposefully integrated into your organization, and do they help achieve business results?

• Are these digital technologies tied to key performance indicators? Is there a process to routinely evaluate the outcomes?

• Is your team equipped to adjust strategies and tactics based on business intelligence?

• Is the entire business kept well-informed about the impact of marketing initiatives?

Keep in mind that digital maturity won’t happen overnight; it’s a gradual progression. You can start small with one sector of your business or by examining one system. For instance, you might improve customer success by examining and optimizing the entire customer experience from start to finish for a single segment.

What business outcomes do you want to achieve? Define success in your language and then work with your technology team to determine how to achieve it. It’s easy to get caught up in what the technology does -- its features and functionality -- rather than what we want it to accomplish for our organization.

The bottom line is digital change is essential, and because markets and technology shift so rapidly, a mature organization is never transformed but always transforming. Even if your company hasn’t reached full digital maturity, you can begin to build a foundation that will equip you to support digital transformation.

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