Rising to digital transformation’s challenge


Digital transformation is certainly not a myth, despite this figure from the survey. The forward-looking and necessary process has the potential to drive business growth and unlock digital innovation.

However, implementing the organisation-wide change has its challenges.

59% of those surveyed by managing consultancy firm A.T. Kearney thought integrating new technologies into an established infrastructure, while 51% suggested a corporate culture that is not ready to embrace digital technologies are the two biggest barriers to successfully integrating digital innovation in an organisation.

The survey was conducted by A.T. Kearney at the firm’s Digital Business Forum in London this year, with respondents consisting of 100 c-suite business executives in Europe across the finance, healthcare, consumer, chemicals, travel, communications, automotive and energy sectors.

>See also: How to move beyond digital transformation

“Companies can no longer ignore the impact digitisation can have on all aspects of commerce, including business processes, services, and transactions,” said Ramyani Basu, principal at A.T. Kearney.

Indeed, the potential to catalyse growth is the leading driver of digital innovation, according to survey findings, with 36% of respondents stating greater customer acquisition as the most significant business outcome of digital innovation, followed by increased revenue (20%).

The benefits

68% of respondents felt sales and customer services will benefit the most from digital innovation over the next three years.

Operations and logistics were ranked second (37%) when asked what two business functions will benefit most from digitisation over the next three years, with marketing and innovation and R&D split for third place at 27% each.

>See also: Digital transformation in 2016

Interestingly, only 20% of respondents said digital innovation will benefit the back-office (finance, human resources, IT, etc.) operations of their business and only 17% said it will benefit production.

“Our data demonstrates a significant opportunity for organisations to leverage the power of digital innovation both internally and with an external ecosystem of players to build a long-term competitive advantage across business functions. And, while doing that, organisations shouldn’t forget the social responsibility of bringing the whole organisation with them in this digital journey,” said Basu.

The challenges

So why did the majority of c-suite executives think digital innovation has not delivered a high business impact at their organisation?
Well there still remain significant barriers for organisations to overcome.

The absence of leadership engagement (41%) as well as overcoming internal ‘red tape’ (25%) ranked high when asked about the top two obstacles to the integration of digital innovation.

>See also: Digital transformation is the new kingmaker

Despite these hurdles, enhanced brand image (19%), increased collaboration (15%) and increased profits (10%) were considered to be significant business outcomes as a result of digitisation.

Digital transformation is the key to driving business growth and value in the future. But no one said it was going to be easy.

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Nick Ismail

Nick Ismail is a former editor for Information Age (from 2018 to 2022) before moving on to become Global Head of Brand Journalism at HCLTech. He has a particular interest in smart technologies, AI and...

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