Modernizing IT: What’s Holding Businesses Back?

While businesses today face a paradigm shift in how they operate, they must first become more agile and gain a greater visibility across operations as they embrace modernization.

The business world, like society at large, is experiencing a moment of turbulence. At this year’s World Economic Forum in Davos, leaders called it a “polycrisis” -- a collision of stressors from inflation to recession to global conflict to supply chain crises to the possibility that globalization as we know it will fragment into conflicting regional interests.

How can businesses cope? They have no choice but to adapt, turn on a dime, move at speed and rapidly scale.

IT modernization is the essential element that, done right, makes businesses agile and competitive enough to survive and thrive. But this can’t happen without IT leaders who understand why modernization efforts must be at the top of every business agenda. 

Many IT leaders are navigating this new digital reality with initiatives for cloud migration, app modernization and Internet of Things. Businesses have spent about $7.2 trillion over the past three years alone. Yet too many leaders are not seeing enough value from their efforts.

The problem is not tech itself but rather an organization’s ability to harness that technology strategically and effectively -- to plan, build and deploy technology infrastructure that makes them truly agile and competitive. Organizations are lagging in their modernization projects, not because of the hardware and the software, but because the organization itself gets in the way.

We commissioned a survey of global IT decision-makers from Forrester Consulting on what’s holding companies back when it comes to modernizing their IT operations to help customers understand where to place their investments. 

The survey found:

  • Automation isn’t being adopted fast enough: The top process-related challenge for organizations is a lack of automation. The survey found 44% of organizations lack automation, leading to human errors not being caught. And over a third also noted that they are not embedding security throughout their current operating models -- leaving them open to vulnerabilities that could fundamentally disrupt their business.
  • Businesses have old and complex IT infrastructure: Only around half of organizations can: effectively scale operations as needed (55%), quickly respond to disruptions (52%), and easily adapt to unforeseen events (48%), highlighting shortfalls in their current operations models. Also, less than half (48%) of organizations surveyed noted that they struggle to control and predict IT costs in the cloud and only 43% are easily able to identify why they have security issues.
  • There is a shortage of in-house IT skills: Almost half (42%) of respondents noted their organization doesn’t have the right skill sets to manage their current operating model.
  • Customers (and employees) have ever-increasing expectations: Customers and employees alike expect adaptability, speed, and scalability. However, only half of organizations surveyed believe they can deliver on these expectations.

Across the global economy, these operational inefficiencies combined with lack of automation, IT complexities, and a shortage of critical IT skills have slowed progress for most businesses. And this lag comes at a time when customer expectations for a seamless digital experience are now table stakes.

So, what should IT leaders do to right-size these operational issues? I’d argue a more holistic and tailored approach is needed to address today’s challenges and begin to reap more value from existing technology investments.

As a first step, IT leaders, working alongside their business leaders, need to determine their organization’s most pressing challenges and blind spots. What issues are going unnoticed and unaddressed? Is it technical, contracting, legal, regulatory, or compliance? And next, they must gain better transparency and visibility into their overall operations. Establishing an end-to-end view of IT operations can help identify security weaknesses and areas where they can drive more efficient processes through technologies like automation.

Also, true modernization cannot be accomplished alone. It requires outside partnerships to help guide businesses through the change management, upskilling, and platform integration that is necessary for a complete modernization. IT leaders should look for ways to collaborate with strategic and reliable partners. And this is where managed services providers can come in to help bridge the divide in skills, offer new solutions, and enhance security to help businesses achieve their goals and get cloud ROI back on track.

While businesses today face a paradigm shift in how they operate, it’s critical they focus first on becoming more agile and gaining greater visibility across operations as they embrace modernization. After all, the decisions they make today will ultimately enable them to drive tangible business outcomes for years to come.

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