Only 7% of companies have digitally savvy leadership

That’s one of the findings of a study done by MIT Sloan researchers from CISR (Center for Information Systems Research) and published in the Spring 2021 edition of the MIT Sloan Management Review. The study was made with almost 17,000 executives of 1,984 large global companies. Among the companies they studied, the average top management team has nine members. Overall, only 17% of individual team members are digitally savvy.

They define being digitally savvy as having an understanding, developed through experience and education, of the impact that emerging technologies have on businesses' success.

More interesting findings:

• CIOs and CTOs are the most digitally savvy executives. But only around 45% are digitally savvy.
• In terms of CEOs, COOs and heads of marketing, around 23% of them are digitally savvy.
• Sales and CFO executives are 12% digitally savvy.
• In terms of industries, at the top, with 30% digitally savvy executives, we have media, software, and telecom.
• At the bottom (1% digitally savvy executives): construction; arts, entertainment, and recreation; and agriculture, forestry, fishing, and hunting.
• Somewhere in the middle (12% digitally savvy): finance and insurance.

Why does this matter?

According to the study, having a digitally savvy C-level impacts directly on the bottom line. For instance, A digitally savvy CEO together with a digitally savvy CFO who, rather than operating as a gatekeeper, can help identify which digital investments have the potential to promote breakthrough performance is associated with a 6.7 pp increase in revenue growth.

In this study, the authors compared the performance of the top 25% of digitally savvy management teams with the 25% bottom, and the differences are impressive:

Call to all product people and product leaders

I do believe it is our responsibility as product people and product leaders to help change this. Product people are digitally savvy, with a deep understanding, developed through experience and education, of the impact that emerging technologies have on businesses' success.

During my period leading the digital transformation at Lopes, the biggest real estate company in Brazil, between 2020 and 2022, one thing that was clear to me is that we had to bridge the gap between business and technology so the company could take the most out of its investment in technology.

To help bridge this gap I created the concept of digital drops and business drops. Every month we had two important moments in the company:

• Business Drops at Lopes Labs All-Hands: Lopes Labs is the name of the technology and innovation team I led at Lopes. During our All-Hands our team met for around 2 hours and we celebrated our results, shared learnings and welcomed new members. We always separated around 20 minutes so people from the business could talk about their areas and educate the Lopes Labs team. Below are examples of the topics we covered:

• Digital Drops at Lopes Labs Update: every month we gathered the entire company for one hour to show Lopes Labs recent results and achievements. Between 5 to 10 minutes of this meeting was dedicated to share some topic on digital product development and management. Below are examples of the topics we covered:

Announcing: new public training on vision and strategy

That’s why I’m launching my very first public training, to help product leaders create vision and strategy for their products. Actually, in this training, we will do it together. There are very limited spots, so get yours now! With 30% discount!

Digital product education, coaching and advisory

I’ve been helping companies bridge the gap between business and technology through education, coaching, and advisory services on digital product development and management. Check here how I can help you and your company.

Newsletter

I write regularly about product management, product development, digital product leadership, and digital transformation. You can receive a notification whenever I publish a new article, without depending on any social network algorithms to notify you! Just subscribe to my newsletter.

Digital Product Management Books

Do you work with digital products? Do you want to know more about how to manage a digital product to increase its chances of success, solve its user’s problems and achieve the company objectives? Check out my Digital Product Management bundle with my 3 books where I share what I learned during my 30+ years of experience in creating and managing digital products:

• Startup Guide: How startups and established companies can create profitable digital products
• Product Management: How to increase the chances of success of your digital product
• Leading Product Development: The art and science of managing product teams

You can also acquire the books individually, by clicking on their titles above.