Businesses are in a fight for their survival, and they know it. Their direct competitors, large and small, are digitizing their businesses. And those businesses that effectively digitize first have much to gain competitively. However, as we’ve reported in “Digital Transformation: Coming from Behind” and other stories, many organizations are experiencing significant challenges when it comes to executing on their digital transformation strategies.
To get a sense of where companies are in their efforts, managed SD-WAN and cloud services provider Masergy contracted research firm Webtorials to conduct its 2019 Digital Transformation Market Trends Report. The report is based on a survey of large and small companies in 35 countries, and it found that the early digital transformation wins tend to be among customer-facing investments, such as customer service and customer experience.
Not surprisingly, the report found 78% of respondents believe that their company’s primary industry is rapidly evolving and that digital transformation is necessary to survive the change underway. The benefits respondents cited (ranked in order) were enhanced customer experience and customer relationship management, the ability to maintain competitiveness, enable new ways of doing business, increased productivity, cost savings, increased revenue generation and enhanced product development.
With the majority of digital transformation efforts failing to meet their established objectives, businesses are clearly facing no shortage of obstacles. According to the Masergy survey, the challenges respondents cited as barriers to a successful digital transformation effort, in order of difficulty, are budget commitment, executive support, in-house skill sets, organizational buy-in and lack of adequate IT infrastructure.
These findings paralleled findings from other related and recent surveys, including the “State of Digital Transformation” report from research and advisory firm Altimeter. The report found that CIOs (28%) or even CEOs (23%) typically own digital transformation at an organization. That report also found that enterprisewide support is a leading barrier, with many organizations citing the belief that digital transformation is a cost center (28%), elusive ROI (29%) and resistance to change (26%) also are barriers.
The survey also found that only one-third of respondents believe they can meet their digital transformation goals without help from a solutions provider. This finding parallels other reports. Earlier this year, IDC found that business services related to digital transformation will grow at a healthy 29% annual rate over the next five years.
Interestingly, the “2019 Digital Transformation Market Trends Report” from IDC found those looking for outside help prefer smaller service providers (58%) rather than larger providers (43%).
What technologies most support digital transformation? According to this survey, those that help in migrating to cloud or in improving security, as well as data analytics and AI, mobility, collaboration and emerging technology such as virtual reality and IoT.
These reports show that while businesses are aware of what is at stake for their enterprises, the bad news is they are having a hard time making headway. The good news is that it doesn’t appear too late, just yet, for businesses to get their digital houses in order.