Analysts continue to highlight the adoption and benefits of digital transformation. The Gartner 2017 CEO Survey, for example, found that 42 percent of respondents claimed to put digital first as their corporate strategy.
They recognize that digital is key to business transformation, with particular benefits for product and service innovation. A McKinsey study, ‘Why Digital Strategies Fail,’ found that early adopters of digital capabilities had a three-year compound annual growth rate more than twice that of other businesses.
The ‘Riverbed Digital Performance Global Survey 2018’ took a closer look at adoption and the challenges facing organizations taking on digital transformation.
Although 98 percent of the business decision makers responding to the survey agreed that the delivery of digital applications and services was critical to their future success, 80 percent felt that important apps and services were failing on a regular basis. They were concerned that these problems were impacting customer experience and reducing any productivity gains.
Respondents highlighted a number of barriers to realizing success. Budget constraints were reported by 51 percent of decision makers, while 45 percent cited complex, rigid legacy infrastructure. Lack of visibility across the end user experience was a challenge for 40 percent and 39 percent felt that staff skills were proving a barrier.
Prioritize Infrastructure Investments
Investing in the right infrastructure is a crucial factor in digital success. Digital services demand levels of speed, performance, scalability, mobility and availability that are beyond the capabilities of legacy infrastructures.
A study by IDC, ‘IDC FutureScape: Worldwide CIO Agenda 2016 Prediction,’ reported that 60 percent of digital initiatives would be unable to scale because of a lack of strategic architecture. Add in the requirements of IoT and other digital-led technologies and performance levels become even more critical.
Cloud migration is one of the strategies businesses can adopt to modernize their infrastructure without major investment. Respondents to the Riverbed survey put that as top of their investment priorities, with 60 percent feeling that modernizing networks and infrastructure would drive greater agility, as well as providing the foundation for the performance levels essential to digital success.
The ‘McKinsey 2018 Global Survey’ also reported that modernizing infrastructure was the top focus of transformation initiatives, with 63 percent of respondents prioritizing it. Other important initiatives included redesigning the IT organization, changing the IT delivery method and simplifying architecture.
Balance IT Priorities
The McKinsey survey prompted an article on IT capability – ‘Can IT rise to the digital challenge?’ The survey response indicated that, while there was a strong corporate focus on digital initiatives, IT departments needed to do better on their overall IT practices. Results indicated that companies demonstrating and implementing best practice in core IT activities made faster progress in digital transformations.
To maintain a balance, the firm recommends that IT must be careful not to focus too much energy or resources on new digital efforts without giving equal priority core activities that keep the business running.