Most Company Digital Transformations Stall
A new study has found that more than half of companies that are going through a digital transformation end up stalling or abandoning their projects.
The biggest hurdles are a lack of planning, and complex changes to personnel, processes and the adoption of new technologies.
Many older companies are just now taking the next step in their efforts to automate functions and also better manage their data. But the magnitude and complexity of the IT transformation can be staggering.
Despite the fact that technology is all around us these days, 44% of companies have made no efforts to automate their processes, according to the survey by IDG Research Services, which was commissioned by technology solutions provider Insight Enterprises. IDG surveyed 200 IT executives working in organizations with a median of 6,250 employees across a range of industries.
Not only that, but 62% of companies had not documented their digital transformation plans. These findings were from sizeable companies, so it stands to reason that the numbers would be even worse for mid-sized and smaller enterprises.
The biggest impediments to upgrading technology that the study found were:
- Outdated IT infrastructures.
- Outdated processes and software.
- Legacy technology like networks, storage and computing.
- Confusion over cloud strategy, planning, and execution, which remain major stumbling blocks for many.
- Too many competing priorities.
Avoiding inertia and failure
Unfortunately, IT transformation cannot be approached as a side project. It requires a concerted, company-wide effort.
The report has the following tips:
Get executive buy-in. Digital transformation needs to be driven by executives who have both the authority and the willingness to change the status quo. Such executives should be prepared to:
- Make painful decisions,
- Take some financial “gambles,” where necessary, and
- Try multiple avenues.
Start small. It’s important to tackle projects that are manageable and relatively easy to control at first. The report authors recommend not trying to change the entire organization all at once.
A better approach is to focus on smaller projects first, which can be used as a proving ground for what works for your organization. Benefits of smaller projects at the outset include:
- They are quicker to start.
- They are easier to fund.
- It’s faster to verify success.
- They are less painful to abort (if necessary).
Tackle legacy system challenges head-on. This requires planning and prioritizing which systems you want to upgrade first. You may have to hire new staff with a different skill set than some of your existing IT staff, if you have any. Otherwise, it means contracting out to a new entity that can help with your transformation.