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Companies are still spending millions on digital transformation

innovation
(Image credit: Image Credit: Fancycrave1 / Pixabay)

The Covid-19 pandemic forced organizations across the world to reassess their digital transformation strategies, but it didn’t stifle innovation, nor force businesses to reduce spending.

This is according to a new report from Couchbase, which claims that more than three quarters (77 percent) of organizations were forced to make significant changes to their digital transformation plans. In some cases, they had to start all over again. 

But the rate of innovation almost doubled during the pandemic, rising from eight percent last year, to 14 percent this year. Average digital transformation spend, meanwhile, grew from $27 million to $27.5 million this year.

The bad news, however, is that a lot of this investment was wasted. The report states that almost four in five projects either fail or are delayed or scaled back.

As a result of the pandemic and nation-wide lockdowns, businesses were incentivized to focus on end-user experience, the report further claims, stating that more than half (55 percent) made “significant” improvements to UX this year, with an additional 17 percent creating an “excellent” UX.

Many businesses that did not manage to meet their digital transformation goals cited Covid-19-related disruption, but Couchbase’s report says that technology challenges were, in fact, the biggest roadblock to transformation. Most organizations struggled to implement complex technologies, or relied on legacy tech that couldn’t meet new digital requirements.

“Enterprises understand that the real test will be in how they adapt to life and business in 2021 and beyond,” said Ravi Mayuram, SVP of Engineering and CTO at Couchbase.

“The underlying issues that were preventing modernization of an aging digital stack have been brought to the forefront by the pandemic, and there is now even greater impetus to accelerate ‘digital transformation.’ This realization that aging infrastructure will not serve organizations' new needs in a post-pandemic world where we will live, work and play remotely has tipped the scales in favor of new investments in innovation and modernization.”