While the success rate of digital transformation efforts has not always been much to write home about, the general consensus has remained that trying to digitally transform one’s business is far preferable to not doing so. This is reaffirmed by the latest Chinese Digital Transformation Index from Accenture, which shows that companies who manage to achieve a digital advantage were able to grow their revenue at nearly 4 times the rate of their peers.
The annual index is in its fourth year and surveys over 560 companies from across nine industries. It reveals a significant increase in the pace of digital transformation during 2021, with this reflected in the number of companies regarded by Accenture as “champions”.
These companies are able to use digital technologies successfully, and as a result, are generating over 50% of their revenue from activities that were launched in the last three years. The index reveals, however, that there is also continued progress being made across the board, with more and more companies showing reasonable progress in their digital transformation journey.
“Businesses in China have proven their ability to remain competitive on a global scale, and an overwhelming majority of executives in China — 91% — are confident about achieving their growth targets. However, within the country, the performance gap between digital Champions and others is widening each year,” the researchers say. “This puts digital transformation at the forefront as companies realize how technology investment and implementation can accelerate industry upgrades and continue to drive sustainable growth amid the profound and prolonged impacts of the pandemic and disruption.”
Digital capabilities
After diving deeper into the data, the researchers found that a key failing of many company’s digital transformation efforts was the lack of involvement and collaboration with members of their supply chain. This meant that laggards were often ineffective at launching new products in response to changing consumer demands.
“We expect the pace of transformation to speed up across all sectors under the 14th Five-Year Plan for National Economic and Social Development, and for this to propel a change in how we work, live and govern,” the researchers continue. “However, to further unlock the multi-value of technology, organization, talent, ecosystem and society, companies must set a clear digital transformation strategy that solidifies a digital core and continuously and accurately evaluate their performance to find areas for new innovations.”
To achieve strong digital transformation, the analysis suggests a number of key components, including strategic commitment, the utilization of cloud technologies, robust data governance, and the inclusion of all stakeholders from across the value chain.
