Business leaders everywhere know that digital transformation is necessary for survival, but the journey is far from easy. In the digital transformation jungle, under-prepared enterprises fall victim to predatory competitors and hidden traps. Our latest global research shows that the transformation process is proving difficult for the vast majority of businesses, revealing that nine in ten companies worldwide (87%) are finding it ‘a significant challenge.’
Companies undergoing transformation can experience a lot of turbulence along the way.
These organisations are under threat from rivals that are better prepared to scale and deliver quickly under pressure. They have a simple choice: disrupt or be disrupted. However, the majority of enterprises are finding themselves tripping over significant challenges while they try to keep up with the pace of change.
Business leaders beware of The Agility Trap
Having gauged the opinions of more than 1,000 businesses worldwide on this paradox, we coined the concept of ‘The Agility Trap.’ Our global executive study revealed that while businesses are actively prioritizing digital transformation, the challenges they encounter along the way often means that the faster they try to move the slower the process becomes.
Large, complex organizations often discover that the pace of change is set by their customers and a wave of disruptive competition. This can make these businesses feel very slow, very quickly.
One third of the businesses we spoke to (34%) currently have a high level of active digital transformation projects, while 50% have a moderate level of activity and just under half (46%) have significant plans for future projects.
What’s driving these projects?
Unfortunately the vast majority of these businesses report that they are not ready to embrace digital transformation despite their willingness to do so. This predominantly relates to the complexity of the process, with 70% of businesses saying transformation efforts are undermined by internal complexity and nearly two in three (63%) claiming their business systems cannot cope with the switch to digital.
This clearly shows the journey through the digital transformation jungle is fraught with danger for the majority of businesses that choose to embark upon it. Therefore, prior to setting off on their digital expedition enterprises must keep three considerations in mind:
Top Survival Tips for Digital Transformation
1. Keep moving, never stand still
Deciphering the barriers to change within the organisation is vital. These can be many and varied, including how agile and flexible the current infrastructure is; whether the business runs on legacy IT systems; and whether databases allow staff to access data on the move and make real-time decisions.
However, half of the businesses we researched (51%) admitted they are either resistant to or have mixed views towards digital transformation. This is leaving businesses ensnared in the agility traps, which they can only avoid by addressing important considerations around change culture, risk factors and agility.
The biggest of these traps is operational silos, which occur when data is not shared across the organisation and processes are not connected. This can cause serious grief for customers, who will become disillusioned by companies that aren’t able to track the customer journey, connect previous conversations customers have had with various departments, and ultimately show timely understanding of their specific issue or request.
2. It’s best to walk before you run
For some organisations who are being required to run faster than ever to keep up with their competition, hitting the accelerator on digital transformation too quickly can have catastrophic effects.
A well-known UK bank discovered this as it moved ahead of the curve in delivering mobile banking apps when the smartphone revolution kicked off. Customers swiftly seized on the offering only for it to crash at the height of the Christmas period, locking users out of their accounts across all channels and incurring a very public customer service crisis as customers took to social media in droves when their calls to the bank went unanswered.
To avoid similar pitfalls along the digital journey, enterprises must take time to understand the core drivers of their transformation and the associated risks. For example, our research found that the greatest risk in meeting transformation goals for programs driven by higher levels of customer expectation is a lack of relevant knowledge within the executive leadership team.
3. Constantly re-evaluate your path
Enterprises must have a clear understanding of their business operations and take a considered, well-planned, and process-led approach. This means clearly identifying their aims, the operational or infrastructure challenges that may lie ahead, the processes that will be required to change, and any potential pitfalls that may occur along the way.
Enterprises must implement processes and technologies that encourage innovation and collaboration across business and IT teams. Digital innovators within the business should lead the charge by introducing new collaboration ideas and methods, cutting across silos and departments. They should do this by asking each business function the following question:
How can we make this process or function better, more efficient and less onerous?
More than four in five businesses (81%) told us that the pace of change in their industry is increasing due to customer expectations, so enterprises cannot afford to stand still and ignore it. The smarter way to navigate the digital jungle, avoiding and escaping the traps that lie in waiting, is to utilize agile, wrap-around technologies, smart processes and a collaborative mind-set.
Get your free copy of the full global executive study ‘The Agility Trap’ report for more insights into the pace of digital transformation in your part of the world.