Digital transformation – a loss of momentum?

Capgemini and the MIT Center for Digital Business have been working together for a couple of years to understand the processes and progress towards digital transformation, defined as the use of new digital technologies (social media, mobile, analytics or embedded devices) to enable major business improvements (such as enhancing customer experience, streamlining operations or creating new business models). In 2011 they published a report entitled Digital Transformation – A Roadmap for Billion Dollar Organisations and today they have released an analysis of a global survey of 1600 senior executives, managers and employees entitled Digital Transformation – a New Strategic Imperative. It is not good news!

The key findings from the survey are:

  • According to 78% of respondents, achieving digital transformation will become critical to their organizations within the next two years.
  • However, 63% said the pace of technology change in their organization is too slow.
  • The most frequently cited obstacle to digital transformation was “lack of urgency.”
  • Only 38% of respondents said that digital transformation was a permanent fixture on their CEO’s agenda.
  • Where CEOs have shared their vision for digital transformation, 93% of employees feel that it is the right thing for the organization. But, a mere 36% of CEOs have shared such a vision.

The main reasons why progress has been slow are a lack of a sense of urgency, not enough funding and limitations of IT systems. There are of course companies that have embraced digital transformation but these account for only 15% of the companies in the survey. A further 6% are aggressively adopting new technologies but without an effective long-term strategy.

This is a very well-written and presented report which raises questions about the ability of companies to take advantage of the technologies that vendors are marketing with very significant budgets. This lack of momentum not only impacts on economic growth on the part of the companies concerned but also potentially result on IT vendors not making their numbers. Interestingly the term Big Data appears nowhere in the report.

Martin White