April 24, 2020
Real business needs and a desire to improve customer engagement top some of the drivers for digital transformation, according to a survey conducted by TEKsystems. Though the responses were collected in the months prior to the pandemic, the results show some of the causes and challenges companies face taking next steps in transformation.
The release of the 2020 State of Digital Transformation survey results from TEKsystems, an IT services management company, offers some idea of where certain organizations stood in their plans at the tail end of 2019. That could shed some light on how prepared they might have been to adapt with current circumstances and the days to come.
Digital transformation in respect to the survey refers to using digital technologies to create new or enhance existing business processes, culture, or customer experiences, says Jason Hayman, market research manager at TEKsystems. That includes use of automation, machine learning, cloud migration, and data and analytics.
Hayman says the survey responses did not present many surprises. “It was striking how closely some of the data matched up to real world, digital transformation stories and anecdotes.” The research sought to analyze and compare digital leaders and laggards, he says to find opportunities and lessons learned. Though many digital leaders put comparatively deeper investments toward transformation, Hayman says even they have not completely figured everything out. “They’re still piloting or maybe have limited adoption of emerging technologies,” he says. “They might be leveraging it in one or two business units at most.”
Rather than a one-time revolution, Hayman calls digital transformation a long-term journey that may see highly varied results. There was significant disparity, he says, between C-suite assumptions and their workforce’s expectations for transformation. For example, some C-suite respondents expected a 41% increase in revenue growth after digital transformation while the rest of the organization anticipated 26% topline growth in revenue, Hayman says. “Still big revenue jumps but a huge difference in expectations and alignment.”
There were also differing assumptions between the C-suite and the rest of the organization in terms of how soon they might see a return on investment, he says. “Companies that aren’t aligning their expectations are going to be very slow to scale, they’re going to be slow to respond,” Hayman says. “If they’re not securing consensus and conviction among senior leaders regarding digital goals -- they are going to fail or have a really hard time making headway.” Getting executive-level sponsorship is essential to realizing those digital goals, while also making sure those goals are relevant and achievable, he says.
TEKsystems conducted the survey last November and December, gathering responses from some 510 technology and business decision makers, which includes managers, executives, and members of the C-suite. Those responses point to a common desire to appear modern and relevant, as well as a wish to evolve how staff and teams work within organizations.
Here is a sampling of feedback from the survey respondents, who could choose multiple answers to some questions:
Motivations for transformation seem tied to addressing real operational needs and a bit of futureproofing.
60% of respondents had a business need that required digital transformation.
40% wanted to develop talent and skills of their employees for the future
39% felt competitive pressure to pursue transformation
Goals of transformation related strongly to advancing how organizations do business.
72% want to improve customer experience and engagement
48% want to reduce their operational efficiency
47% want to replace or upgrade their legacy IT systems
A desire to transform may be limited by very real challenges to change within an organization.
39% indicated that the complexity of their current IT environments, a lack of alignment for transformation within current organizational structures, or siloed mindsets and behaviors posed challenges to transformation
32% cited too many competing technology priorities
26% reported that a change management, implementation complications, and aversion to risk presented challenges to their plans
Leaders and laggards in transformation naturally invested in their plans at vastly different magnitudes.
Investment in excess of $10 million
29% of digital transformation leaders
15% of laggards invested at that level
Investment between $5 million and $10 million on transformation
38% of leaders
23% of laggards
Investment between $1 million and $5 million on transformation
25% of leaders
41% of laggards
Investment up to $1 million
8% of leaders
21% of laggards
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