This document discusses digital transformation and digital mastery. It defines digital mastery as having both digital capabilities through technology-enabled customer and operations initiatives, as well as leadership capabilities like vision, governance, and engagement. Companies that achieve digital mastery, called "Digital Masters", significantly outperform their peers in areas like revenue, efficiency, profitability, and market valuation. The document analyzes different industries and companies' levels of digital mastery and provides recommendations for how any company can build their digital DNA and drive a successful digital transformation.

1. DIGITAL TRANSFORMATION
BEYOND THE HYPE

2. What do these companies have in common?
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3. What is digital mastery?
Digital Capability
Leadership Capability
Technology-enabled initiatives in:
Customer Experience
Leadership capabilities including:
Vision
Internal Operations
Governance
Engagement
IT-Business Relationships
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4. Mastering both dimensions is the key to achieving the digital
advantage
Nike: From Separate Initiatives to Firm-Level Transformation
1
1
DIGITAL CAPABILITY
Digital Product
Digital Product
Design
Design
Social Media
Social Media
Customized
Customized
Manufacturing
Manufacturing
+
2
2
FIRM-LEVEL
TRANSFORMATION
LEADERSHIP CAPABILITY
Digital Division:
Digital Division:
Nike Digital Sport
Nike Digital Sport





Digital marketing
Digital product innovation/design
Digital commerce (e/m-commerce)
Digital technologies (GPS, mobile, etc.)
Customer analytics
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5. Four levels of digital mastery
FASHIONISTAS
Many advanced digital features (such
as social, mobile) in silos
No overarching vision
Underdeveloped coordination
Digital culture may exist in silos
DIGITAL MASTERS
Strong overarching digital vision
Good governance
Many digital initiatives generating
business value in measurable ways
Strong digital culture
BEGINNERS
CONSERVATIVES
Management skeptical of the business
value of advanced digital technologies
May be carrying out some experiments
Immature digital culture
Overarching digital vision exists, but may
be underdeveloped
Few advanced digital features, but
traditional capabilities may be
Strong governance across silos
Taking active steps to build digital skills
and culture
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6. Digital mastery varies widely
FASHIONISTAS
BEGINNERS
DIGITAL MASTERS
CONSERVATIVES
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7. Digital Masters have significantly better financial performance
than their peers
Revenue Generation
Efficiency
Profitability
Market Valuation
+6%
+9%
-11%
+26%
-12%
+12%
-4%
-10%
-24%
+9%
-7%
+7%
Basket of indicators:
Revenue / Employee
Fixed Asset Turnover
Basket of indicators:
EBIT Margin
Net Profit Margin
Basket of indicators:
Tobin’s Q Ratio
Price / book ratio
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8. Some industries average higher mastery than others…
Telecoms
Travel and
hospitality
High
Technology
Average industry
digital mastery:
Retail
Pharmaceuticals
Banking
Consumer Packaged Goods
Insurance
Utilities
Manufacturing
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9. …but every industry already has digital masters
Percentage of firms in each industry by quadrant
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10. Digital Masters have a common Digital DNA
They invest in 100% of the elements of Leadership Capability…
 Transformative Vision
 Shared Vision
“Digitising P&G will enable us to manage
the business in real time and on a
demand-driven basis. We’ll be able to
collaborate more effectively and efficiently,
inside and outside the Company”
Vision
Chief Digital Officer



CDOs & Digital Unit
Chief Digital Officer
Shared Digital Units
Investment Committees
Governance
 Promoting Change
 Employee Participation
 Investing in Skills
Engagement
IT /
Business
Innovation challenges
“The IT Team (...) now work hand in hand
with the Creative Media team.”
Digital Year
 Shared understanding between IT
and business executives on role of IT
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11. Digital Masters have a common Digital DNA
…and they make strategic decisions on where to excel with digital capabilities
Focus Investments on
Where they Choose to
Excel Digitally
+
Combine Digital
Capabilities to Exploit
Synergies
Customer
Experience
In-store
Online
Social
media
Mobile channel
Unified Processes / Integrated Data
Process
Excellence
Supply-chain
Integration
Customer experience
Centralized
Ordering
New business models
Unified Processes / Integrated Data
Analytics
capabilities
Personalized Customer
experience
Online
On-premise
Unified Processes / Integrated Data
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12. How to drive digital transformation
Sustain the Transformation
Frame the Digital Challenge
Build Capabilities
Align Incentives & Rewards
Measure, Monitor & Iterate
Understand the Impact
Assess Digital Maturity
Develop Vision & Align Around It
Sustain
Engage
Engage the Organisation
Signal the Change
Mobilise at Scale
Evolve Culture & Adapt Work Practices
Frame
Focus
Focus Investments
Build a Digital Roadmap
Build Investment Case
Set up Governance Model
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13. In conclusion
DIGITAL MASTERY MATTERS
DIGITAL MASTERY MATTERS
IT MATTERS IN EVERY INDUSTRY
IT MATTERS IN EVERY INDUSTRY
ANY COMPANY CAN BUILD DIGITAL DNA
ANY COMPANY CAN BUILD DIGITAL DNA
TAKE ACTION NOW TO
TAKE ACTION NOW TO
CREATE YOUR OWN DIGITAL
CREATE YOUR OWN DIGITAL
ADVANTAGE
ADVANTAGE
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14. The
New
t al
Digi rs
te
Mas
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15. About Capgemini
With more than 125,000 people in 44 countries, Capgemini is one
of the world's foremost providers of consulting, technology and
outsourcing services. The Group reported 2012 global revenues of
EUR 10.3 billion.
Together with its clients, Capgemini creates and delivers business
and technology solutions that fit their needs and drive the results
they want. A deeply multicultural organization, Capgemini has
developed its own way of working, the Collaborative Business
ExperienceTM, and draws on Rightshore®, its worldwide delivery
model.
Learn more about us at www.capgemini.com
www.capgemini.com
The information contained in this presentation is proprietary.
© 2013 Capgemini. All rights reserved.
Rightshore® is a trademark belonging to Capgemini.