A study by the Economist Intelligence Unit (EIU) confirms what many have suspected – digital transformation is not as easy as it looks.
The global study, Digital Evolution: Learning from the leaders in digital transformation, which was sponsored by Pegasystems and Accenture, found a clear split in respondents, which included 444 executives from healthcare, finance and telecommunications (around a third of respondents were from the Asia-Pacific region).
While most organisations expect their operations to be 80 per cent digital or more in the next five years, only 18 per cent have fully integrated customer facing processes with their back office systems, and only 10 per cent report their businesses are fully digital.
Evolving customer needs and expectations were cited as the key driver behind digital transformation, ahead of rapidly changing competitive dynamics and new technologies accelerating the pace of change.
In terms of barriers, the top three challenges organisations are facing in their digital transformation initiatives were establishing the right organisational and governance model, evolving its corporate culture, and funding the necessary investments.
EIU analysis found two statistically significant groups within the survey sample – those who are ahead of the curve and those who are behind it, with these groups displaying organisational practices.
Those who are ahead of the curve are more likely to have a chief digital officer leading transformation initiatives and a separate digital business unit, and be driven by achieving market leadership and disrupting their core business. By contrast, behind-the-curve companies are more inward-facing in their focus and a more likely to cite cost pressures and regulatory compliance as drivers leading them to undertake digital initiatives.
Having digital operate as a separate function is only a transitional measure, the report said.
The ultimate aim of any digital transformation initiative should be the ability for the whole organisation to transform constantly in response to digital innovation,” says Pete Swabey, senior editor at The Economist Intelligence Unit.
Read the full report at www.digitalevolution.eiu.com.
