Businesses seem to believe they are caught between a rock and a hard place. Executives are fully aware of the power and importance of establishing a digital strategy and creating a path towards digital transformation, yet many do not pursue it. Given 88 per cent of Fortune 500 companies that were thriving less than 50 years ago are no longer on the list, the need to start this journey should be more pressing than ever. After all, ordinarily, businesses will practice what they preach, yet this appears absent when discussing digital transformation.
Our Digital Transformation Index shows that nearly three quarters of decision makers around the world believe digital transformation could be more widespread throughout their organisation. Yet it is just a fraction of these enterprise executives who are committed to implementing such an initiative. Herein lies the disparity.
Decision makers must be bold. Progress research shows that 85% of enterprise executives are weary of time constraints on digital transformation, and the financial and competitive risk if it fails. But this cannot be allowed to sabotage a digital strategy and halt the implementation of new technology. Moving with the curve, not against it, can ensure the survival of organisations. This is particularly pressing seeing as 45 percent of businesses believe that they could become obsolete within the next 3-5 years due to the impact of digital start-ups and falling behind the transformation curve. Courage is important, but so is direction. Understanding why you must adopt new technologies and a modern digital strategy is crucial to its success.
And so often, starting is the hardest part. So, here are our top five steps to remember to ensure a successful digital transformation:
1. Use your customer data to inform future strategies
Transformation starts and ends with data, though analytics and data-capture are widespread in today’s marketplace, 72 per cent of businesses are still not using it to predict consumer behaviour and demand. More than two thirds (64 per cent) of companies admit to not acting on intelligence in real-time and are unable to roll-out data-decision making across the business and until this changes, enterprises will continue to lose out to more informed competitors.
2. Agility is the key to success, so be more agile!
Two years ago, business leaders came together to agree five attributes of a digital business and one of the most important was identified as agile innovation. Our data shows that 70 per cent of global organisations are not achieving this objective, largely due to reduced investment in software and application development and thereby extending the time to market. Winners get in fast and those businesses arriving at the table earlier will experience far less resistance from competition and are more likely to seize a significantly greater share of the pie.
3. Put your money where your mouth is
Embracing digital transformation is an absolute must in today’s marketplace and everybody knows it. However, our survey showed that of the 73 per cent of executives that agree that digital transformation could be more widespread throughout their organisation, only 39 per cent have seen innovative digital processes implemented across their organizations. Aligning business strategy with opinions from decision makers and vision from the c-suite will be key in realising a successful digital transformation strategy.
4. Customers drive digital transformation, so differentiate with best-in-class technology
Consumer demand is quite predictable in that the majority of customers prize increased stability, accessibility, flexibility and efficiency above all else when accessing services, data and content. Businesses know this, but decision makers still confess that their organisations could and should be innovating more and six in 10 businesses globally are not meeting customer demands for high-quality products and services. Customers are the number one driver behind digital transformation and it is in meeting and exceeding their needs that businesses will excel.
5. Enable investment in digital transformation through smart budget management
A third of businesses blame a lack of budget and resources for stymied transformation efforts, but there is still money coming in, as 67 per cent of respondents report a superlative revenue of $500m to $50bn. The data also offers an explanation – of the participants, only 41 per cent of organisations credit the board with having driven digital transformation, potentially signalling a lack of commitment from business leaders themselves. Where decision makers are not making the right decisions, it’s important that key influencers within the company come together to communicate the benefits of a modern digital strategy.
Transforming to new school thinking
We’ve established that long-running businesses of all sizes have serious concerns about competition from small, agile, digital start-ups, but the evidence suggests that many are sabotaging their own chances of survival by delaying digital transformation within their own organisations. At least part of this apprehension stems from a need to see disruptive technologies prove themselves in the market. The only problem here is that by the time innovative new solutions and strategies go mainstream, they have already been overtaken by the next big thing in development – meaning that again, digital start-ups speed ahead, taking advantage of younger technologies.
There are ways around this. It’s possible to accelerate the adoption of new technologies through third party IT partners. Often the nature of the relationships between business leaders and service providers or consultants provides a quicker route to acceptance and implementation of a modern digital strategy. The key is to demonstrate the business benefits up front. If you can leverage a relationship with a trusted adviser, the process becomes much simpler and yields faster, better results and the time constraints no longer appear so daunting.
It’s clear that the gap between the views of employees and business leaders regarding digital transformation in their own organisation and actual implementation is creating a significant obstacle to progress. To deliver best-in-class products and services, businesses can no longer afford to wait to implement new technologies. Where additional barriers are created by decision makers, IT leaders will need to collaborate with trusted enterprise IT partners whose advice can more effectively resonate with the c-suite.
Eric Velfre, Senior Vice President, Compute & Networking Division EMEA at Dell EMC
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