In just the past few years, digital transformations have gone from maverick to mainstream. IDC predicts that at least 55% of organizations will be undertaking this type of transformation by 2020. However, about half of those efforts will likely fail. A study by Wipro Digital found that only 50% of companies are successfully executing their digital transformation strategies.
A digital transformation might fail for any number of reasons. Here are four common causes:
- Viewing technology integration as the end goal
Integrating technology into a company’s operations is crucial to digital transformation, but it shouldn’t be the end goal. Technology integration should be the means to achieve the desired business outcome — which is typically to deliver value to customers.
However, companies can get so caught up in adding new technology to their existing processes that they don’t stop to ask whether they should. Sometimes, the best way to achieve the desired business outcome is to start from scratch and design new processes, products, or services.
To be successful in the current digital age, companies need to fundamentally rethink about how they operate and deliver value to their customers. According to digital transformation experts, this requires employees at all levels and in all areas of the business to challenge the status quo, experiment, and not be afraid to fail. This mindset often necessitates a cultural shift in companies.
- No support from the top
The head of a company can successfully delegate many tasks — but leading the organization’s digital transformation isn’t one of them. A digital transformation requires a strong leader. This person needs to be able to motivate employees at all levels and in all business areas to help transform the company.
Equally important, the person needs to lead by example. If the head of the company doesn’t actively participate, why should employees?
- Employee resistance
Employee resistance is the biggest impediment to a successful digital transformation, according to the Harvey Nash/KPMG’s 2017 CIO Survey. Employees might resist for several reasons. They might see the push for digital transformation as just another “Program of the Month” — a new set of processes that will cause them extra work and then quietly fade away.
Other employees might resist because they have a fear of change or a fear of failure. Employees might also be afraid that a successful digital transformation will result in them losing their jobs.
It’s understandable how they might reach this conclusion. Artificial intelligence (AI) is one of the technologies that companies leverage in digital transformations. In the past, AI has been portrayed as a job killer because it’s used to automate tasks. However, researchers are now beginning to take a softer tone toward AI, saying it will create more jobs than it will eliminate.
- Lack of in-house expertise
Digital transformations require technical skills that aren’t typically found in-house. Not many companies have cloud computing experts, DevOps engineers, AI specialists, and other digital professionals on their payroll. A study by the Technical University of Munich found that 64% of companies don’t have the personnel with the skills necessary for digital transformation. Fortunately, companies can outsource the talent they need for their digital transformations.
Plan for success
Digital transformations fail for a variety of reasons. Knowing which pitfalls to watch for and planning ahead to avoid them can help make your digital transformation a success.
Is your company struggling with its digital transformation? Synoptek has the expertise you need. Contact us today.
About the Author
Synoptek is an established firm that provides information systems consulting and IT management services. Synoptek and its predecessors have been providing these services for 23 years.