It is a time of unparalleled change, not just in the world of IT, but also in business. The role of technology within an organisation has evolved from a supporting role into the main vehicle of growth and innovation.
Technology is transforming existing processes and platforms to make them more efficient and cost-effective, while helping employees be more productive and satisfied. Innovation is also enabling entirely new ways of working and creating new opportunities that can result in new revenue streams.
Although technology has never been more integral to organisations, the relationship between IT and business has become increasingly complex.
There is widespread recognition of the benefits of digital transformation, however the implementation of digital initiatives remains a challenge, according to the 2019 ITI - a comprehensive survey of more than 1,000 IT decision-makers across Europe.
The research survey has identified four key paradigms, one of which is the “innovation imperative”, which is the belief that companies are realising powerful outcomes through digital innovation.
Three quarters of IT Decision Makers (ITDMs) believe their digital investments have been successful and plan to increase investment by a staggering £10 million over the next two years. At present, enterprises have spent on average of £32.23 million over the past 24 months, and plan to spend £42.12 million over the next two years.
However, 66% believe that IT departments are being set up to fail as they manage dual roles of maintenance and innovation. Although 48% of respondents say digital transformation projects are funded from a standalone budget, as many as 38% believe they have insufficient funds for what they want to achieve. Others fear a lack of internal skills is hampering progress.
What’s clear is that although awareness of the benefits of digital transformation is high, organisations are struggling with the implementation of the technologies that facilitate this change, and the substantial financial and organisational investment required to see it through.
Another paradigm identified in the ITI – the explosion of data – can help to explain these technical difficulties.
Nearly half (46%) of ITDMs say advanced analytics, enabled by Artificial Intelligence (AI) and Big Data, have been integral to digital transformation initiatives over the past two years while 55% say AI and Machine Learning will most significantly impact the future of IT.
Organisations have concerns about where to store data, which workloads to migrate from on-premise infrastructure to the hybrid cloud, and how to secure sensitive information. The importance of data security and protection is reflected by the fact that data management and governance is a key challenge for almost half (45%) of ITDMs.
The cloud is widely viewed as an essential platform for innovation because of its scalability and powerful capabilities. Two fifths (42%) of ITDMs believe cloud is one of the most critical technologies for digital transformation but there is recognition that external support may be required to optimise strategies.
The potential for hybrid cloud to facilitate digital initiatives, and the challenges associated with implementation, are such that 51% say systems integrators who can build hybrid data environments will deeply impact the future of IT.
As many as 45% say the primary goal of their digital transformation efforts is to enhance the customer experience, while 40% say it is to develop new products and services. However, seven in ten ITDMs believe it is important for corporate IT to resemble consumer-like experiences because it results in a more engaged, productive workforce.
Organisations are seeking to meet employee demands for a more personal, intuitive and seamless experience, with 79% offering ready-to-go devices out of the box and 49% investing in self-service support platforms over the past two years.
Employee demands have also been a key driver of cloud services, with staff demanding the ability to work anytime, anywhere and on any device. This also has an impact on recruitment, with 74% of ITDMs agreeing that modern technology is essential to attracting and retaining talent.
A useful metric of internal transformation is employee satisfaction, with 44% reporting a fall in complaints about the user experience of corporate technology over the past 24 months.
If an organisation is to fully embrace digital transformation, then it must also personalise the employee experience as well as the customer facing elements of the business.
The final paradigm shift is the belief that an optimised supply chain can enhance digital transformation projects, driving down costs while increasing efficiency of operations.
There is a recognition among 72% of ITDMs that a more streamlined process of procuring, maintaining and replacing technology will allow IT departments to become more strategic with their time by channelling their resources into projects that will advance the business.
For 40% of organisations greater visibility into software purchasing would help reduce the overprovisioning of public cloud services, and for 41% it would help reduce software licensing.
Cloud wastage in particular is an issue. Organisations spend an average of £29.5 million on cloud services every year, however £8.8 million (30%) of this spend is underutilised.
The difficulty in determining whether public, private or hybrid cloud is the most appropriate for a certain workload is cited as a challenge for 44% of ITDMs, while 39% report difficulty planning and allocating budget for cloud consumption.
The four paradigm shifts outlined in the 2019 ITI illustrate both the opportunities and the challenges associated with digital transformation. If executed correctly, it offers businesses of all sizes access to new capabilities that were previously only accessible for large enterprises.
The volume of opportunities digital transformation brings is matched by the new challenges that organisations face in navigating a complex landscape of vendors, products and services. Although the necessary skills can be acquired through recruitment and training, external support is often required to optimise workloads and procurement.
While it can be tempting to accelerate transformational projects simply because the potential benefits are significant, organisations who have a strategic roadmap – devised internally or with the help of partners – will experience greater success.
Those that don’t have a plan in place are destined to fail before they even start.
Find out more from the 2019 Insight Intelligent Technology™ Index