Why Digital Transformation Fails

Digital transformation is the rave, and many businesses and enterprises are jumping on the trend. However, the idea that digital transformation is a trend may cause organisations to invest in digital initiatives that don’t yield the expected business outcomes. In such a case, we can say the digital transformation has failed.

When we say digital transformation fails, we don’t mean that the concept of itself is a hoax. Rather, the way digital transformation is done goes a long way in determining the success of the transformation. Therefore, businesses need to understand that digital transformation is not just a trend to jump on to attract more customers.

What Is Digital Transformation?

In simple terms, digital transformation is a process by which enterprises integrate technologies in their business operations to improve business outcomes. However, digital transformation doesn’t end there. It is a continuous journey that has no finite end. This is because new disruptive technologies emerge every day. There is rapid technological advancement in today’s world, and it is the trigger for digital transformation. It helps businesses approach work operations with edge-cutting solutions that enhance growth and improve customer experience. Operational costs and inefficiencies are also reduced.

Digital transformation is the way to go, for businesses who want to stay relevant. However, in embracing this concept, businesses must tread the right path. Digital transformation cannot be approached from any angle. Some requirements must be met before it yields the intended results. Otherwise, digital transformation can fail.

Why Digital Transformation Fails 

Failure is normal in digital transformation, but it is not about the technology. First of all, enterprises must be able to discern the difference between digitalisation and digital transformation. Digitalisation is the application of technology to your existing business operations. On the other hand, digital transformation is doing business the digital way. It is easy to mix them up. Digitalisation is an integral part of digital transformation, but not all there is to the latter.

Digital transformation failures usually stem from issues like leadership, mindset, and strategy.

The lack of an effective digital transformation strategy is one of the primary reasons digital transformation fails. A digital transformation strategy is an organisation’s roadmap to digital transformation. It guides the organisation on what technologies to adopt, talents to hire, time frame for projects, costs, as well as other important analyses and details for successful digital transformation.

An effective strategy also considers future technology trends and their possible impacts on digital transformation. When an enterprise wants to embark on a digital transformation journey, it is pertinent to have an effective strategy. Usually, businesses can’t do this on their own. This is where an IT consulting company comes in.

An IT consulting company like Hidden Brains can help enterprises develop and implement effective digital transformation strategies. Our strategies are customised to suit your business needs and allow you to take your business to the next level seamlessly.

Other reasons why digital transformation fails include:

1. Lack of understanding of what Digital transformation is: As mentioned earlier, digital transformation is beyond adopting technologies and integrating them across business operations. You will find that a lot of people talk about it, but few understand the concept. It has become a buzzword since the COVID-19 pandemic pushed the agenda and is a trend every enterprise wants to join. Global digital transformation spending is expected to reach $2.4 trillion by 2024. With more businesses embracing the concept, the rate of failure would be higher if they do so without a clear understanding of digital transformation and what it can do for them.
2. Lack of clear goals: This stems from the lack of the required technological insights on digital transformation. When there are no defined outcomes, it is bound to fail. Hence, having an effective digital transformation strategy is crucial. It defines clear goals as required by the business’ needs.
3. Lack of commitment from senior management: There’s usually a discord between top levels of management and the other units of operation, especially the IT unit. Most members of senior management believe digital transformation is the sole responsibility of IT teams, and they don’t need to get involved. This is a false notion because digital transformation is an organisation-wide process. It requires cooperation and commitment from all members of an organisation. The lack of cooperation can cause the digital transformation to fail.In most cases, the lack of commitment arises from the lack of understanding of what digital transformation is and what it can do for the business.

   When the senior management of an enterprise is actively involved and committed to digital transformation, others would be motivated and would develop the right mindset and attitude towards the projects. With the right mindset, the chances of digital transformation failing are low.

4. Lack of expertise: Digital transformation is a broad area that requires expertise in different technical fields like cybersecurity, machine learning, and others. Hence, it requires the best talents to be successful. Not everyone who claims to be a digital transformation expert is one.When an enterprise wants to embark on a digital transformation journey, it is essential to have the right people on board. Otherwise, digital transformation will fail. It might be difficult to find the right people, but you don’t have to look any further.

   At Hidden Brains, there are over 500 experts in different digital transformation fields who can bring your business dreams to life without stress. We understand your business, your industry, and its needs.

5. Underestimating the costs: Digital transformation can be very capital intensive. This is another area where digitalisation and digital transformation differ. The former isn’t as expensive because it only involves integrating technology in certain areas. On the other hand, digital transformation encompasses the entire organisation.Since it is easy to mix the concepts up, some organisations tend to underestimate the cost of digital transformation and set a budget that can barely cover the costs. The effect of this will be the inability to invest in the right solutions—such an organisation will be forced to go for cheaper options. Ultimately, this can lead to the failure of digital transformation.

   It is better to get the right solutions than spend more on technical debt and maintenance.

6. Focusing on technologies only: Disruptive technology is an integral part of digital transformation. However, they are often complex and difficult for organisations to understand. Despite the lack of basic knowledge and techniques needed to adopt these new technologies, some organisations go on to implement them without being able to adapt to them. When this occurs, digital transformation is likely to fail. There should be a synergy between the technologies that will be adapted and other parts of the business, like marketing and others.As established, failure in digital transformation is normal when the right things are not in place, but so is success. If your organisation’s digital transformation has once failed, you can try again! If you are hesitant to start your digital transformation journey for fear of failure, there are ways to set the groundwork for a successful digital transformation. They include:

• Develop your organisation, including talents and assets, to ensure that you stay relevant in a rapidly-changing business environment. Your employees must have the right (agile) mindset toward digital transformation, and they should possess the right skills needed for innovations and scaling digital transformation projects.
• Be strategic in the solutions you invest in. Don’t just go after digital solutions because they are ‘digital’. What solutions do you need? How can they help your business? How can you integrate them seamlessly with existing technologies? These are important questions to ask before your organisation buys solutions.
• Partner with the right people. Your organisation’s digital transformation journey is not one to embark on alone, except you have qualified in-house talents. If your organisation cannot implement digital transformation successfully, you need to partner with companies that can help you do so.

Hidden Brains is your one-stop shop for everything digital transformation. You can partner with us to make the most of digital transformation. We help you gain a competitive edge while you maintain flexibility. Our customised solutions are designed to scale your business and improve business outcomes. In addition, we offer excellent consulting services that include formulating effective business strategies that will expand your existing capabilities and allow you to embrace new technologies.