Top Reasons Why Companies Fail in their Digital Transformation Efforts

Indications like culture shocks, resistance to change, competing priorities, and
talent deficits mean that industries need to re-evaluate their digital transformation goals.

CIOs are stitching together different technologies like APIs, cloud, and micro services into
platforms, to augment existing business processes and achieve digital transformation. Agile
architectures are assumed to help streamline operations and serve customers better.
Research conducted by TEKsystems back in late 2019, confirmed that 47% of 510 business and tech leaders say their organizations are advancing digital transformation plans across the enterprise.
But, the reality is that such digitization processes often fail if they are not bolstered with a
complete organization-wide change – technology, processes, and even cultural change
required to pull off the transformation.
Below are the biggest points of derailment for a company’s digital transformation journey:

CEO sponsorship goes lacking

Transformation always starts from the top — in theory, at least. The lack of a clear
transformation strategy often remains as a key barrier to achieving the full digital potential, and CEOs are often to blame.

Culture shock

According to the TEKsystems poll, 39% of organizations say that their organizational structure is not well aligned to support transformation. Everyone is aware of the power of technology, but not always and clearly realizing how to optimize its potential, and that’s where complications start. The narrow mindset of employees — lacking a shared vision to realize the entire ecosystem — is at the core of digital initiative failures.

Problem with siloes

The TEKsystems report cited that 32% of respondents confirmed too many competing priorities acting as a hurdle to digital transformation. COVID-19 highlighted a disconnect in expectations for many organizations. It’s extremely critical to secure consensus among stakeholders and senior leaders regarding business goals.
It’s about successfully transcending the organizational siloes to transform all of the business processes to get desired digital outcomes.

The technology trap

While technology remains the most critical driver of transformation, applying tools that don’t satisfy customer demands or enable the latest digital business models, adds little value. Another significant problem is the inability to carve a roadmap of technology requirements that will set the goal for business objectives- technologies such as predictive analytics, artificial intelligence, blockchain, cloud, or internet of things (IoT). Only with proper balance, the technology trap can be avoided, and that balance is often missing.

Lack of velocity

As per Wipro’s digital survey, enterprises will take about two to three years to see at least half of their digital transformation investments come to fruition. The pace and scale of digital acceleration compound the issues, making it difficult to close the gap between rivals and incumbents.

Talent deficit

Digital transformation initiatives clearly require fresh and advanced talent. 9 out of 10
organizations believe they need new types of talent, and 37% believe that extensive talent
structure changes are required for their digital transformation efforts to become successful.
Today, the demand far outstrips the talent supply.
With companies taking up the digital transformation journey without adequate preparation and clarity, the risks have escalated. Enterprises now stand very little chance of executing their digital strategies effectively. Only smart, cautious, and consistent efforts can save enterprises from digital transformation failures.


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