“Out of 1000 business decision makers, 98% agree that digital, including the delivery of digital services/apps, is critical for future business success; 95% face challenges when it comes to achieving a more successful digital strategy.”
– Riverbed Digital Performance Survey 2018
These numbers make it evident that companies are now aware of the importance of digitization at an enterprise level. The efficiency of the digital transformation strategy can be identified by monitoring user experience and satisfaction, revenue and profitability, market agility, employee productivity, and time to market. In order to build a digital enterprise, organizations have started using latest technologies including the IoT, artificial intelligence, machine learning, natural language processing, conversational interfaces, cloud, and virtual and augmented reality to reinvent existing products and services.
Digital transformation is definitely not a simple task; it requires managing change at numerous operational and technology layers. On the journey to achieve digital transformation goals, businesses need to surmount several significant barriers. This article will explore the most common digital transformation challenges for businesses.
Organizational resistance to change
Globally, a very few people are thrilled by change. For the majority, change is uncomfortable. Organizational change often creates uncertainty about job roles and responsibilities; in some cases, it even raises the specter of job loss. However, in today’s digital landscape, not changing is far riskier than taking a chance and embracing change. An organization’s resistance to change can act as a hindrance to success, and may make it difficult to get funded, marketed, and resourced for future projects.
Digital transformation is not just about digitizing documents and functions. It is also about establishing an approach that promotes self-service and transparency for customers and encourages employees to spend time analyzing the customer data rather than focusing only on the collection of that data.
Many businesses still consider IT as a support department and thus do not upgrade from legacy infrastructure. On top of that, the maintenance of IT infrastructure consumes more than half of the entire IT budget. As most of the investment in IT infrastructure is done during the beginning phase of the business, organizations often become technologically under-equipped over a period of time if they do not adopt the latest technologies.
Now that enterprises have started relying on the cloud, data analytics, mobile devices, it gets even more difficult for companies with legacy IT infrastructure to get things done in an efficient manner. The only solution to this challenge is to invest in upgrading IT infrastructure.
Overly complex systems
While moving towards digital transformation, the level of complexity is often neglected. Every business uses laptops, CRM, ERP, and a list of other systems. Each department within an organization may work on a different system for prototyping, analytics, project management tasks. And then again, there are industry-specific digital tools.
Using a variety of tools and systems causes higher complexity. Moreover, it might get overwhelming for employees to keep track or log on to different systems to perform different business functions. While adopting the digital approach does not mean eliminating the existing tools and systems, it definitely means gluing all the systems together to act as one. A good example of this can be the convergence of OT and IT in the Industrial IoT ecosystem. This convergence can be a challenge in itself; companies need to make sure that the previously autonomous OT and IT are working in harmony to successfully run an IoT ecosystem.
Lack of expertise to lead the digitization
Tech expertise alone is not sufficient to succeed in the enterprise digitization initiatives; organization also require people with the right skill set to start the implementation. When a business aims to become a digital enterprise, the team leading this initiative should be prepared to address a range of technical and operational challenges.
Businesses need to invest in internal team learnings and in making the team digitally literate. If the required expertise is not found internally, businesses can search for external business partners who can deliver the needed expertise in the digitization journey.
Considering how complex the implementation of digital transformation strategy might get, it is important to create a technology ecosystem that acts as a foundation to drive organizational change. The digital transformation approach will also require companies to monitor the process and ensure that the changes are implemented. Digital transformation is not a one-time process, it is something that requires continuous improvement and development at regular intervals.
eInfochips has the know-how of technologies that play a major role in implementing digital transformation. To explore the topic further and discuss the transformation journey for your business, please don’t hesitate to get in touch with us.