This post provides a closer look at how middle market companies grade themselves on their digital performance and which activities—and which companies—scored the higher marks. For the full research report, see How Digital Are You?


Digitizing manual and paper-based processes is a notable priority for most middle market firms. Indeed, many mid-sized businesses already take advantage of a wide variety of digital tools to streamline business processes, cut costs, and gain a competitive advantage across all areas of their companies, from finance, operations, and HR, to marketing and sales and distribution and logistics.

But when the National Center for the Middle Market asked middle market executives to “grade” their companies on digitization performance, most leaders rated their companies as average. Specifically, when asked how well the company does in different digitization areas, based on a scale of 0-4, the overall Digital Grade Point Average for the middle market totaled 2.8, or the equivalent of a C+.

Below is a closer look at the self-assessment and which activities—and which companies—scored the higher marks.

Middle market companies perform best at digitizing day-to-day operations.

Companies graded themselves the highest for digitization initiatives related to daily management of the business and back office functions. In other words, when it comes to keeping the lights on, or activities related to automating accounts payable or managing people, middle market executives are relatively pleased with their performance. Around 50% of executives gave themselves a 3 (good) rating in these areas, and another 15% rated themselves a 4 (excellent). Only 1% of middle market businesses have not digitized these core business functions at all.

Companies are less adept at digitizing customer-facing business activities.

For activities that relate to serving and interacting with the customer, including sales, customer service/interaction, advertising, and logistics, middle market executives averaged a Digitization GPA of 2.5. Around a third of executives gave their companies a score of 2 (fair) in these areas.

Forward-looking initiatives earned the lowest Digitization GPA.

When it comes to areas such as business analytics, strategy development, and innovation—initiatives that may have the greatest influence on the future performance of the company—the average digitization GPA drops to 2.4. Specifically in the area of innovation, a slight majority (52%) of middle market firms say their digitization performance is fair, poor, or non-existent.

Digitization performance is similar across revenue segments, industries, and regions. However, firms that prioritize digitization do the best.

The type of business that middle market firm conduct, where firms are located, or even how much firms generate in annual revenue does not seem to have much of an impact on how proficient the company is at digitization. What does influence self-assessed performance is how much emphasis the company places on digitization, as well as how quickly it implements digital initiatives. The firms that emphasize digitization the most and the companies that enjoy a rapid rate of digitization give themselves the highest digitization GPAs across all categories of digitization initiatives.

So where does your business fall on the scale? Are you keeping pace with your peers? Companies looking for ways to improve their digitization performance may want to consider starting with generating greater buy-in from senior management for digitization efforts. Such support can be key to moving digitization projects forward more rapidly, which may translate into better overall results.

To learn more about digitization efforts in the middle market and the characteristics of middle market digital leaders, see the Center’s full research report, How Digital Are You?