WP001: PwC says you suck at THE DIGITAL - White Paper Review #1
Coté & Brandon Whichard, Software Defined Talk Member’s Podcast, July 21st, 2017

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2017 Global Digital IQ® Survey: 10th anniversary edition

Hey, what better way to start a white paper analysis series than by setting the macro-context? This episode we look at one of those “macro,” what are C-types doing with computers survey/studies from PwC.

Overall rating/advice

You need guidance about these big picture things, at the very least during your annual budgeting and strategy “phases.” If you need raw fodder for putting together your strategy decks and stuff, it’s worth taking a look. 

The most genuine, optimistic take away is: enterprises are looking to grow their revenue (do things in business that drive more buying of their goods and services) and believe that using IT (“digital”) will work out for them. They think they’re doing OK with the skills needed, but think they need to be doing a lot better. The most tactical thing this implies is focusing on the human/computer interaction (design, UX, putting a rapid-feedback loop in place to make software fit the user/customers’ needs better) and shifting IT budget to projects that focus on making the front-line interaction with customers better. 

Lower-level tactics are most and best explained in a brief passage:

  • These top performers also have a better understanding of the human experience that surrounds digital technology (82%, vs. 69% of other companies). They are more likely to resource digital projects with cross-functional teams of business, technology, and user experience specialists (74%, vs. 65%), and to use agile methodologies for the majority of non-software projects (22%, vs. 7%). More of them say creating better customer experiences is a top expectation from digital investments.

Without ever saying “DevOps” (and just saying “agile” twice), they’re basically recommending doing all the agile-cum-DevOps-cum-cloud-native stuff.

Will this report be good for telling you things you don’t already know? Sort of, but you probably already know you should do computer better. It doesn’t really tell you operational tactics (let alone how to put them in place at a resistant organization) as much as what the desired end-state looks like: focusing more on the human experience, i.e., making your customers (and employees, to a somewhat limited extent) more productive and engaged with the IT-driven parts of your business. But, it is only 30 pages!

For vendors, this kind of content is always good, use it if you don’t compete with PwC. Most net-new software being sold by vendors is sold on the premise that enterprises need to improve how they do software, commoditize back-office IT, and focus on new experiences with customers: lots of enterprise hot dogs. I, of course, think that’s all right: the problem is getting enterprises to do what’s obvious and common sense, but contrary to how they currently operate.

This report in particular is a concise version (30 pages) of what you’d get from Gartner or IBM, but that’s mostly due to the lack of raw data, industry specialization, and, worst, being specific on tactics - it doesn’t even mention DevOps!


  • First of all,  to get the PDF there’s no leadgen. So this is fishing for big-time enterprise leads, plus used for PwC marketing and such. Thus, most of this will not apply to small and medium companies. Related to that is that much of thinking and lore of SMB-think (lean startup, etc.) will likely not apply here; these are established, huge companies that have billions in existing revenue and are looking to first protect that revenue, then optimize it (both grow top-line revenue and cut costs, growing profit), and last “innovate.”
  • PwC is highly motivated to have large companies hire them to fix any “gaps” in going digitial. Both in planning out “board level” strategies (those 6 month projects where a bunch of fresh MBAs come in and tell you have time it is), and actual implementation. If their survey had found that enterprises were doing great at “the digital,” the survey would have been killed, never published.
  • There’s actually not that much quibbling with the idea that large organization need to do a lot of digital transformation.
  • What you want to look for are any success cases referenced (are they all PwC clients), who the failures are, and any promises of the benefits of things getting better (will doing the digital raise your share-price, revenue, etc.). You also want to see if there’s an acknowledgement that most things are likely OK - how much does PwC want you to freak-the-fuck out?


  • They often reference “analyzing a decade’s worth of data.” Let’s see if they have some rich, year/year charts then…
  • They do a pretty good job of it.
  • E.g.: “Data mining and analysis, search technologies, service-oriented architecture, and virtual collaboration were top-of-mind technologies in 2007. Attention shifted to mobile technologies, data security, and cloud in the intervening years. Today, emerging technologies like the internet of things and artificial intelligence are seen as the next big things, and other next-generation tools are at their heels.”
  • “2,216 business and technology executives we surveyed in late 2016.” It doesn’t really say the geographic spread, but let’s assume from the title that it’s at least USA + 1, if not more. Probably 60-70% USA, 30% Europe, and the rest as Middle East and Asia; China might be higher, though: you could cut down the USA to 45-50% to get more China in, with a slice of Japan.

  • How they identify “top performers”: “[t]he top performers in our survey—those reporting revenue growth and pro t margin increases above 5% for the past three years and expected revenue growth of at least 5% for the next three years.” Fair enough, but to avoid too much Halo Effect, there needs to be some analysis of cause and effect w/r/t to nailing IT. Revenue and profit increase can be M&A, dumb luck, expansion into high growth markets, consolidation (jettisoning dogs), cooking the books, etc.

The actual content

What is “digital”?

  • “Digital” is a big concept in organizations now. It means “we need to computer better.” It’s become the label for the current wave of how IT should be used. Past waves were: mainframe, desktops (being able to do spreadsheets and “foils”), client/server (centralizing the desktop for all the goodies there), the web (mostly ecommerce, which changed to…), SaaS, THE SOCIAL (mostly as an advertising and sales channel to consumers), cloud computing, mobile, and now (potentially), IoT, AI/ML/voice. Things like having to do regulatory compliance in the late 90’s and early 2000s where in there too, and in that same exogenous, functional requirement way, security is there now.
  • The goals are growth centric: “Nearly three-quarters (73%) cite revenue growth as a top benefit of their digital initiatives, followed by increased profits (47%) and reduced costs (40%). Disruption is less of a focus, despite growing evidence that new technologies and new business models will continue to remake entire industries.”
  • That last bit warrants some typing: as the likes of Ben Thompson have explained, “disruption” is a very specific, very niche type of strategy: entering a market with a lower functioning/quality, lower priced alternative to existing products/services. As success is achieved, you add in more functionality/quality, or redefine customer needs, and then start seriously stealing cash from the incumbents. Incumbents are not only willfully numb and operationally ignorant on this strategy, but it’s very dangerous to disrupt themselves: they would have to undercut their existing cash-cows.
  • Hence, “disruption” would likely rank low among these large enterprises because, instead, they want to innovate new sources of revenue (business models), not cannibalize old/existing ones.
  • And, indeed: “[j]ust 7% of executives say that combatting new industry entrants drove their digital investments.” 
  • I’d read that as: 93% of these enterprises aren’t worried about disruption.
  • It’s easy to think that this is dumb, but some industries, like banking, are OK at fending off and adapting to disruptors.
  • Also, worth noticing: reducing costs is always on the table. Reducing costs is the Morlock for increasing profits.