The digital divide
The rise of new kind of business models like Uber, Netflix and Airbnb are disrupting global industries with their digital first approach.
Implementing a digital strategy is necessary to remain competitive, which is why 32% of board level executives believe digital transformation is the biggest opportunity for UK businesses, according to new research that surveyed 500 UK board level respondents at medium and large businesses in the UK, by Citrix.
However, one in four (24%) executives were still unsure why their organisations are placing such a great emphasis on digital technology.
This figure suggests business leaders are failing to adapt to the requirements of the digital age, where transformative technology is king.
Ola Henfridsson, professor of information systems and management at Warwick Business School agreed and stated that “today, four out of the five of the most valuable companies in the Fortune 500 have built their businesses on digital platforms. Just ten years ago there was only one such company among the top 20.”
“It is therefore staggering that there is such division among UK business leaders when considering the opportunity that digital technology represents.”
“Technology has the power to not only support the efficiency and leanness of a business, but is now becoming ever more increasingly imperative for the creation of value and an improved customer experience.”
The current state of digital transformation in the UK
The report revealed a clear digital division in the boardroom.
One of the reasons some c-suite executives might be apprehensive about digital transformation is that many businesses are struggling to harness the potential of digital.
In an effort to tackle this more and more organisations are incorporating a chief data officer (CDO) into c-suite operations.
Indeed, 45% of those surveyed have implemented a CDO (or equivalent) to stimulate digital transformation across the organisation – and are emphasising their role at the highest levels.
Despite this, one third of businesses admitted to struggling to adopt technology fully into the business strategy.
The report also revealed that just 35% of medium to large UK businesses have a single digital delivery plan for the whole organisation.
Less than one in 20 (4%) of the UK board level respondents questioned could confirm that their business has already moved to a fully digital operating model, while a further 14% have no plans to change business and working practices to incorporate digital methods and practices across the organisation.
Highlighting the divide, 69% of those surveyed UK businesses are now considering changing business and working practices to incorporate digital methods.
Division in the boardroom
Disagreement on digital transformation is rife amongst the UK c-suite, from indecision on whether digital transformation presents a business opportunity to a lack of awareness around digital strategies themselves.
48% of respondents believe a digital strategy is fundamentally different from an IT strategy, while 40% view them as the same, exposing the extent of board level uncertainty around what digital transformation actually means or requires.
The boardroom also demonstrated a lack of understanding around the way in which digital is changing, and will continue to change, almost every business function – whether face-to-face, back office or indirect services with little direct technology use.
>See also: 5 tips to bring IT back into the boardroom
In the next three to five years digital transformation is going to revolutionise business operations across a range of industries.
Those c-suite executives who don’t recognise the benefits of a digital first approach need to hire someone who does. Failing that the survival odds are slim.
Jon Cook, Director, Sales, UK & Ireland, Citrix concludes that “organisations that take advantage of digital technologies to redefine business and IT processes will be significantly more productive and, therefore, more competitive.”
“However,” he does suggest that “digital transformation does not have to mean a complete disruption of the business, it is about powering more intelligent adoption processes and rethinking how things are done”.