Mark McDonald

A member of the Gartner Blog Network

Mark P. McDonald
GVP EXP
8 years at Gartner
24 years IT industry

Mark McDonald, Ph.D., is a former group vice president and head of research in Gartner Executive Programs. He is the co-author of The Social Organization with Anthony Bradley. Read Full Bio

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Why do you need a Digital Edge?

by Mark P. McDonald  |  October 22, 2012  |  1 Comment

Every organization has an edge – a reason behind their future success.  Having an edge is great, but customer expectations, competition and technology dull every edge.  Sharpening these edges becomes increasingly difficult over time as technology makes it easier for competitors to copy, mimic, reverse engineer your edge.

Executives need an edge that is self-sharpening, adaptive and extensible.  The good news is that is exactly what is possible with digital technologies.  Technologies like mobile, social, big data, analytics, cloud, remote sensing, location, etc. represent a comprehensive

The depth and breadth of digital technologies and their capabilities presents a simple challenge for executives, including the CIO. Just because it is possible to do something technically, that does not mean its profitable or the right thing to do.

Right now organizations use digital technology in their operations, yet few generate revenue from those technologies.  They “feel” digital with an average of 68% of their processes using digital technology, but they are not “being” digital with only 27% of revenue on average coming from digital resources.

Creating a digital edge matters – firms with above their industry average levels of digital revenue perform significantly better than their peers.  They have improved growth rates, greater cost productivity and improved capital productivity.  Leaders in a range of industries from hospitals, distributors, banks, airports, etc. are realizing results from creating a digital edge.

Being digital matters. The challenge is navigate the business implications of digitalization.  You cannot just copy digital business models based on giving things away for free or selling advertising.   You have to find the right combination of physical and digital resources that create customer value and company revenue.   That requires identifying digital value, finding the right digital edges and becoming a digital organization.

That is the focus of the new eBook from Gartner The Digital Edge.  This eBook looks at how organizations need to:

  • Thinking differently about digital in terms of the innovations resulting from separating customer accessible value and company addressable revenue that create disruptive digital strategies.
  • Selecting the right type of digital edges based on new combinations of digital and physical resources.
  • Becoming a digital organization by building up digital solutions in new ways, highlighting the need to change Board level treatment of technology and the situations that call for establishing a Chief Digital Officer.

These are the three sections of The Digital Edge eBook that includes experiences of companies ranging from Royal Caribbean Cruise lines, United Stationers, IONX, Rabobank, Copenhagen Airport, CDW, the Children’s Hospital of Los Angeles, among others.

An edge forms where two sides meet.  In the case of a digital edge, executives need to determine how to bring together their current ‘physical’ resources with new ‘digital’ resources and capabilities.  Those that find the right edge, one that changes industry borders, accelerates consumerization, incorporates behavior will forge a future of sustainable customer value, company revenue and results.

The Digital Edge on Twitter and At Gartner Symposium

The book is launching at Gartner Symposium in Orlando there is a presentation at 9:45 am at the Swan 6 Ballroom.  I will also be on Twitter hosting a tweetchat on Wednesday October 24th at 1:45 PM Eastern.  We will be using the hashtag #GartnerChat.  Hope to see you there.

Related Posts

Mapping the three paths for digitalizing the business

Feeling digital is not the same as being digital

Digitalization creates new dimensions for disruption

Digital substitution vs. digital combination as a strategy

Creating a difference between digital, digitize and digitalization

The Digital Edge page on Amazon.com

The Digital Edge is also available on iBooks

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