In the Age of Digitalization: Word Has Spread About the Need for a Digital Strategy
Whether an SME or a mid-sized company: those with a clear digital strategy are generally much more active. These strategies are profitable when companies succeed in integrating their organizational and cultural structures as well as their information systems, and when they can convincingly demonstrate the added value to their employees over the long term.
For a study, 150 people from German companies were surveyed. The study provides insight into whether and to what extent a company can drive digital transformation through its own business model, and what role M&A plays in this process.
68% emphasize that digital transformation plays a central role in corporate strategy. At the same time, 45% of companies have no digital strategy or no clear one.
Analog Management
German companies use digital technologies particularly in the areas of (customer) support and operational processes. Once processes are fully digitized, the data can be used to inform strategic decisions.
A missing or underdeveloped digital strategy hinders a company’s business model; companies with a clear strategy are more committed to driving it forward. 71% stated that such digitally driven acquisitions play a central role in the transformation.
Companies with an existing digital strategy have been significantly more active in digital initiatives over the past two years than companies without such a strategy. Investments in development, research, and other areas represent another avenue for digitalization. Numerous companies have also been significantly more active in these areas over the past two years.
The Success Factors of a Digital Transformation
In successful transactions, digital tools for company valuation and portfolio optimization were used significantly more frequently than in less successful transactions. The greatest challenges are data and transaction security, as well as know-how and intellectual property rights (e.g., software). Compared to traditional transactions, these are particularly critical success factors.
“Soft” factors are also crucial and are particularly successful when the target company’s organizational and cultural structures, as well as its management information system, are successfully integrated into the acquiring company’s own organization.
In successful transactions, only 2% of employees left the company during the integration phase. In less successful transactions, the figure was just under 11%. Whether or not the founder leaves the company after the acquisition is not a major factor. In less successful transactions, the figure was nearly 11%, while in more successful transactions it was around 9%.
