Digital Transformation: Beset by paradox

Life is full of paradoxes. Take the findings of our recent Digital Transformation Index. For instance, though almost three quarters of global business leaders think that digital transformation could be more widespread throughout their organisation, while less than four in 10 have embedded digital ways of working.

In fact, when you dig deeper into the results of the study, it is clear that organisations are riddled with contradictions — intentions or achievements undone by people, often through accident rather than wilful disregard.

Here are five contradictions which don’t seem to make sense when you consider that 15% of businesses in India think they may become obsolete within three to five years, and 80% feel threatened by digital startups.

Customer experience faux pas

While companies recognise that customers want faster access to services and information anytime and regard unbroken connectivity as a key characteristic of a best-in-class digital business, around six in ten respondents confessed that they are unable to completely meet their customers’ digital demands. If customers were key drivers behind digital transformation, this represents serious flaws in a company’s digital transformation strategy.

Data gaps

Transformation starts and ends with data, and yet a majority of companies admit to not acting on intelligence in real-time, and are unable to roll out data decision-making across the business. Around 93% of the respondents are investing in company-wide data-driven decision-making.

Not very agile

Two years ago, business leaders agreed on five attributes of a digital business. One of these attributes is to innovate in an agile way. According to the Digital Transformation Index, most organisations are falling far short. While this could be caused by many reasons, two-thirds of respondents admitted that they were not investing in agile innovation to enable software developers to code and securely launch new applications within shorter cycles.

Misaligned strategy

Nearly everyone agrees that digital transformation is an absolute must in today’s increasingly competitive marketplace. More than three quarters of organisations in India (84%) agree that digital transformation could be more widespread throughout their organisation, but only 63% are investing in IT infrastructure and digital skills to compete with startups.
Money problems

Though 67% of respondents globally report a revenue of $500 million to $50 billion a year, 30% of businesses in India blame a lack of budget and resources for stymieing their transformation efforts — despite aspiring to be a best-in-class digital business and feeling the pressure to keep up with their competitors. The lack of serious funding could be the underlying reason for the revelation that only 28% of organisations in India have a dedicated executive committee to assess digital transformation progress.

Digital transformation in India

Digital transformation is perceived as the process of revamping the traditional business practices by implementing digital technology in all facets of business. Though digital is all-pervasive irrespective of size and industry, the journey varies from organisation to organisation. In Dell’s recent Digital Transformation Index, a whopping 84% of the Indian business leaders confessed that digital transformation could be more widespread in their organisation.

Legacy IT systems and inflexible infrastructure have been one of the biggest hurdles faced by organisations who have embarked on the journey of digital transformation. The digital age is all about innovation, creativity and reshaping, but legacy IT systems and rigid infrastructure limit organisations from exploring their true potential. The aim to modernise these systems is an ongoing process owing to the employee resistance and lack of clarity and support of the top-level management.
It is important to understand that digital transformation requires an end-to-end approach, which means continuous monitoring, resourcing and reviewing in order to reap maximum benefits from the numerous possibilities that the digital platform has to offer.

While an explicit and comprehensive strategy is the key to a successful transformation, the responsibility of the strategy-makers does not end there. It is essential for them to communicate the roadmap and ensure that collaborative efforts are made to achieve the common objective across departments and locations as well as monitor the progress. This will result in a holistic and accelerated changeover.

Overcoming ingrained attitudes

Successful digital transformation involves changes in business processes, organisational structure and people’s behaviour. When companies consider the fear of being eclipsed by a creative digital startup, businesses are sabotaging their own chances of survival. However, much of this comes down to battling intrinsic ways of doing things, as people have a natural tendency to stick with established habits — even if these habits are counterproductive.

The technology adoption lifecycle curve points to this tussle with ingrained attitudes. While innovations are coming to the table thick and fast, it can take several years for disruptive trends to go mainstream and for people to catch up with the technology’s promise. One way to accelerate adoption is to defer that third-party IT partners can bring fresh authority and guidance to a company’s transformation efforts. They can coach, equip and enable their customers to benefit from new technology,

In summary, the contradictions remind us that there’s a correlation between cause and effect. If we want to deliver against these attributes, we need to close the gap between saying and doing. This involves corralling everyone to sing from the same song sheet.  Any transformation programme worth its salt demands a weighty emphasis on people as it does on technology.

(The writer is President and Managing Director, India Enterprise, Dell EMC)