As a cofounder at Innowise Group with 20-year experience in IT, Pavel loves helping businesses grow through digital transformation.
Digital transformation seems to be on everyone’s mind. A few years ago, it was a vague concept, but it has blossomed into a vital component of modern technological advancements that enable businesses to grow.
However, companies around the world still struggle with digital adoption despite the digital transformation market being estimated at $594.5 billion in 2022 and projected to reach an impressive $1.5 trillion by 2027. Even worse, 70% of digital transformation initiatives miss their goals. So, what can businesses do to bypass the missteps that sabotage innovation?
In this article, I will look at seven barriers to sustainable digital advancements as well as tips for overcoming these obstacles.
Misunderstanding The Nature Of Digital Adoption
In essence, digital transformation encompasses how companies leverage high tech to reinvent or reimagine their internal processes to enhance overall business performance.
Over time, however, the phenomenon has become too catch-all. The term “digital transformation” has come to include a variety of other processes, such as integrating technology to automate manual tasks and software suite optimization. As a result, the misalignment between what is intended and what is achieved can lead to digital adoption failures.
To avoid this issue, clarify the nature of the digital journey and set clear objectives, comprehending the slight differences between transformation, integration and optimization. Digitization should focus on business needs, future goals and existing processes, not vice versa. At the very beginning, it is important to examine business processes and identify areas where digital adoption will produce the best results.
Retaining Legacy Systems
When leading a digital transformation project, it is essential to establish an up-to-date software environment to ensure success. Obsolete systems hinder advancement, as they can fail to keep up with innovations. Mostly, this is due to outdated technologies lacking the tools, services and data analytics necessary for successful digital transformation.
Organizations that adopt modern technologies, therefore, must have a well-developed tech stack that provides reliability, convenience and security. With the right systems in place from the start, companies can help ensure that their efforts will remain on track.
Not Considering The Required Technology
Digital transformation projects require much more than simply implementing a new system. When it comes to compliance issues and other matters, failing to consider the ramifications of a digital transformation project can be devastating.
For example, introducing Zoom or WebEx to facilitate employee communication isn’t enough. The business must research both the entire available tech stack and the security and compliance implications associated with these tools. Failure to take this extra step could result in costly delays and financial losses.
Driving Digital Adoption In A Silo
Since data is fuel for digital transformation, all the departments involved in the process should be on the same page, considering corporate information as a “single source of truth.”
Unlike technology or skill bases that do not interfere with innovative enhancements, piles of unstructured data often trap in silos within a given department, location or region. Leaders should break down the silos and foster continuous collaboration on data quality and unity from multiple sources to facilitate digital adoption.
With this in mind, encourage employees to consider digitalization a main priority by consolidating workflows and promoting a mission-critical vision.
Failure To Hire The Right Talent
Hiring the right talent is essential yet complicated. Even though the pandemic-induced unemployment rate is not lessening the talent market, people with specialized skills in fields like AI and cybersecurity still need to be made available. This makes it increasingly important for companies to identify potential hires who are knowledgeable about such initiatives.
These employees need to effectively communicate their expertise and invaluable insights that will help the company succeed with digital transformation. Without suitable talent guiding their efforts, companies run a much higher risk of failure. More importantly, using software to replace employees is outside the goals of digitalization. In essence, by transforming processes, businesses should consider technology as an opportunity to allow effective employees to focus on higher-margin, intelligent tasks instead of mundane, routine ones.
Inadequate Processes And Procedures
Successful digital transformation requires a holistic approach, ensuring alignment of internal processes with strategic goals. Unfortunately, many companies fail in these endeavors because they neglect the need for institutional shifts to fight pitfalls toward digitalization.
In many cases, decision makers can avoid hurdles if all components from the initial planning stages are well thought out. Moreover, managers responsible for digital adoption should introduce regular check-ups to guarantee that employees leverage software tools as intended. Besides fighting a natural human tendency to resist changes, they also should elaborate a management strategy that explains the purpose of change, employees’ roles in the transition and the benefits for all parties involved.
Acquiring Technology Instead Of Adopting It
Companies often think the most important part of digital transformation is the decision to invest heavily in acquiring software, solutions and emerging technologies. In fact, the most important aspect is the adoption of this technology. Costly expenses could all be for naught if leaders do not spend enough time considering how these investments will be implemented and utilized.
Ultimately, proper adoption and execution of these digital innovations help determine its overall success. Unfortunately, instead of embracing progressive technologies, many companies get stuck in “transformation-washing,” embarking on initiatives that stakeholders should have implemented a long time ago.
The Bottom Line
Digital transformation is definitely a tough craft to master, even beyond the objective difficulties in finding enough investment and forming a full-fledged team.
Nonetheless, when combining changes in management approaches, technology choices and staff mindsets, digital transformation can bring terrific outcomes. In order to achieve these outcomes, remember that digital transformation is no longer an option but a necessity to stand out from the competition and dig into a post-industrial era.
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