Designing Digital Organizations

Designing Digital Organizations

          
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Designing Digital Organizations

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    How Are Digital Businesses Different?

    For the most part, the companies we studied use new digital technologies in two ways, often simultaneously. First, they bake digital technologies into their products and services. For example, Schneider Electric, John Deere, and the Schindler Group (a manufacturer of elevators, escalators, and moving walkways) are able to employ many types of new information-based services, analytics, and insights by adding internet-connected devices, such as sensors, microprocessors, radios, and GPS locators, to their products. In some cases, digital data has led to new disciplines, such as precision farming, and new ecosystems, such as communities of customers developing answers to common questions.

    Second, interactions involving customers, employees, business partners, suppliers, investors, and regulators, are increasingly digital. For example, wherever practical, the managed-care consortium Kaiser Permanente gives patients access to doctors through the internet rather than requiring in-person visits.

    Both types of digital application may seem simple, but each requires substantial redesign of business and operating models. Indeed, the companies we studied made explicit design changes in five separate dimensions of their businesses: customer experience, product and service offerings, ecosystems, control and alignment mechanisms, and ways of working.