What are the five main barriers to digital transformation and their solutions?

As technology continues to take centre stage in the strategic function of business, organisations are striving to embrace cloud and the digital, online experience to gain a competitive edge in the market — there are, however, barriers to digital transformation or digitalisation.

1. Size and scope

The size and scope of projects can often be a barrier for digital transformation initiatives.

However, according to Philip White, managing director of Audacia, “digital transformation doesn’t have to mean engaging in large-scale programmes.”

Instead, he suggests, “where possible, businesses should focus on incremental changes, starting on a smaller scale, addressing low hanging fruit, and continuing on an incremental measured pursuit of technological change.

2. The risk factor

Risks and uncertainties around technology projects can act as another barrier to digital transformation.

“In order to minimise risk, businesses should identify and plan for various project outcomes in advance; for example, multiple third party integrations with poorly documented APIs,” continues White.

“By planning for and addressing risks early on, you’ll benefit from either a fail-early approach, or the ability to implement a plan B, both ensuring minimal impact on project progress, resource and spend.”

3. No ROI in sight

One of the biggest barriers to digital transformation initiatives is when there is no clear direct return on investment.

To overcome this barrier, White explains that “businesses should rectify this by defining a clear set of digital success criteria at the start, defined based on what you are trying to achieve — are you creating additional revenue streams or enhancing internal operations? Measures can be based on anything from metrics to softer statements such as ‘we will be able to provide customers with a way to engage 24/7 around the world’.”

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4. Data and department silos

The most common barrier to digital transformation, according to Steve White, head of transformation accounts at Yotta, is data and department silos.

He explains: “One common example is that the software applications being used by departments are very specific to those service areas, often require specialist knowledge to use effectively and are locked down via account profiles and permissions. They also incorporate different user interface designs (UI) and user experience designs (UX) which all make access by other departments or users within the organisation extremely difficult.

“These department applications rarely incorporate mechanisms to easily share the data that is locked within them on a real time basis, and departments themselves can be very protective about ‘their’ data.”

In order to break down these data and departmental silos and connect teams to help drive digital transformation, organisations could use a common data set and single application across all service areas.

White continues: “This means data is shared and can be layered and reported against to provide forecasts and preventive measures when trends are spotted. By having an open application programming interface (API), data can be incorporated from other business systems or shared with other systems to ensure efficient end-to-end processes are implemented. There is only one version of the truth and multiple sources of the same data do not need to be maintained across the organisation.

“Additionally, using a common mobile and desktop UI/UX and a common way of leveraging the application, means cross skilling and deploying resources into other service areas is made more efficient and quicker as people understand and know the UI/UX. Allowing data to be augmented by other services areas increases the insight organisations can gain and therefore results in greater value to the organisation and their customers.”

5. Inability to gain buy-in

Perhaps the largest barrier to digital transformation surrounds a change in culture and the inability to gain organisation buy-in. This often prevents projects before they’ve even started.

White identifies that “getting buy-in from both stakeholders and ultimate end-users is vital for project success.”

He says: “Tying new technology initiatives into the vision and future of the business and highlighting the long-term goals, over short-term thinking, will endear senior leaders to the change and encourage innovation. This, alongside internal communications around how the technology will benefit your employees day-to-day, will help to ensure company-wide buy-in.”

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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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