How does Australia compare when it comes to digital acumen? John Riccio unveils the 2015 Digital IQ Survey, to assess how far Australian businesses match the critical attributes that point to success.
The 2015 Digital IQ Survey – PwC’s measure of digital ‘health’ – paints a picture of Australian enterprises that are failing to capitalise fully on their investments.
At 75 points, the Digital IQ ‘score’ for Australian businesses continues to sit almost 3% below the global average of 77.2*, and well below the score of 81 for the survey’s forerunners, suggesting that we lack the confidence to embrace digital innovation.
Digital investment and priorities
The annual Digital IQ report seeks to crystalise the actions that leaders can take to ensure their digital programs deliver and sustain value. This year it did so by isolating ten attributes that correlate to stronger financial performance, based on responses from almost 2,000 business and technology executives around the world.
When it comes to digital investment, the order of priorities for Australian executives align with those of their peers globally: over 40% say that their number-one goal for digital investment is to grow revenue. A further 22% cite the pursuit of better customer experiences as their priority, followed by 16% that are chasing profit increase.
However, the figures also show that globally most businesses are taking a short-term view of digital, with a mere 1% saying they utilise technology to disrupt their business,
Marrying digital spend with success
Although aligned when it comes to goals, Australia appears to be trailing in financial performance. Against a global average of 18%, only 14% of respondents in Australia work in what we class as ‘top performers’ – those companies with stronger revenue and margin growth than the majority.
Nearly a quarter of Australian executives are diverting more than 15% of revenue into digital investments – so the volume of spending doesn’t appear, on the surface, to present an issue. Yet these budgets are mostly being funnelled to IT (34%) while globally, companies are investing in digital more broadly.
Australia’s spend may correlate to what eight out of ten executives see as their greatest obstacle to success: outdated technologies. Combine this with the revelation that most executives here define ‘digital’ in the context of technology-related activities, and what begins to emerge is a narrow focus that doesn’t encapsulate a truly digital mindset – one that addresses wider issues of disruption, engagement, digitisation and trust.
Strategy, innovation and execution
Out of the ten attributes identified for success, the greatest gap between top performers and the Australian average comes down to strategy. Whether that is due to leadership structures remains to be seen: only 35% of respondents here expect CIOs to lead digital efforts, for example, as opposed to 40% globally.
Australia closes the gap, however, when it comes to innovation and execution. Our highest scores correlate to how we invest in competitive advantage and our ability to proactively manage security and privacy. But on no counts do we hit a category’s top note – and this is a cause for concern.
Read the Australian results of the 2015 Digital IQ Survey here.
* 2014 score: Australia 61% to global 63%.