Why Is Digitizing Support Functions So Hard?

Results from a recent BCG benchmarking study reveal that despite the allure of digital’s benefits, most companies aren’t prepared to digitize their support functions. Conducted in November 2017, the study used a deep-dive version of BCG’s Digital Acceleration Index (DAI) to assess digital maturity in support functions and shared service organizations of about 900 companies. Participants hailed from enterprises based in 45 countries, across 8 major industries.

Among our study participants, the companies most aggressively driving digital transformation in their support functions—what we call the digital leaders—clearly outperform the others on vital metrics such as revenue growth and profit margin.

Yet just 20% of our respondents are digital leaders in terms of driving and pursuing the digital agenda in support functions—the most advanced stage of digital maturity measured in our study. As much as 80% of them are at a less advanced stage—digital performer, digital literate, or digital passive.

Digital leader

  • Digitization is at the top of the agenda.
  • RPA opportunities are realized/under realization; AI opp. are pursued.
  • Support functions act on a holistic digital transformation roadmap.

Digital performer

  • Support functions drive the digital agenda using proven use cases.
  • Opportunities are actively pursued.
  • No overarching digital concept or roadmap exists across functions.

Digital literate

  • Relevance of digitization is seen, and first pilot projects are launched to explore opportunities and provide proof of concept.
  • No clear digital ambition or roadmap exists.

Digital passive

  • Low degree of digitization.
  • Opportunities are passively observed but not pursued or promoted.
  • No digital ambition or roadmap exists.

The upshot? A huge percentage of companies have a significant opportunity to supercharge the performance of their support functions and shared services by digitizing them.

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Digital Support Functions & Shared Services