Digital business transformations are conceptually of interest to IT services providers because it provides an opportunity to tap into funding beyond what’s been allocated in the IT budget. But a series of recently published surveys illustrate just how challenging it is to get business executives to transfigure digital business transformation concepts into an actual plan of action.
Where the challenge lies
In a survey of 400 senior business executives, Wipro Digital finds that one in four business executives are not even sure what digital business transformation means for their organization. Over a third (35%) said their organization lacked a clear strategy, while nearly one in five said they believe digital business transformation is a waste of time for their organization.
Naturally, there are always going to be internal skeptics when it comes to any major business initiative. But a survey of 1,400 decision makers conducted by 451 Research of behalf of CenturtyLink, a provider of networking and cloud services, finds that over half (51%) have no formal digital transformation strategy. Another 23 percent are working on isolated digital projects without an overarching strategy, while 19 percent are still in the planning stages. Another seven percent admit they have no ongoing digital transformation strategy.
PwC, the global consulting firm, even goes so far as to suggest there is a crisis of confidence in the air. An annual survey of 2,200 business executives conducted by PwC finds there’s been a 15-point drop in executive confidence between this year and last.
What this means for IT service providers
None of this means IT services providers shouldn’t be looking for digital business transformation projects to help drive. There is after all nearly a billion dollars being attached to digital business projects in 2017 alone. But it does mean they should impose some form of a litmus test to determine just how digitally savvy an organization might be. Many CEOs prompted by a board of directors are anxious to kick off a digital business transformation project. But unless there’s a lot on political support for that project within, the chances are high that achieving the desired business outcome is unlikely to occur. In fact, rresearch from the Intelligence Unit of The Economist that was sponsored by Hewlett-Packard Enterprise suggests that digital business transformation has yet to have a significant material impact on the way IT products and services are procured. Of course, an IT services provider that bills by the hour may consider that to be an unfortunate outcome for the client. But given the fact that more compensation these days is being tied to business outcomes, IT services providers have more vested interest in them.
When it comes to digital business transformation, there’s always a temptation to start with a project that will have a major impact on the business model of the organization. But given organizational resistance to change at scale, many IT service providers would be well-advised to start small. A relatively simple mobile computing project can go a long way towards instilling digital business transformation confidence. Whatever the approach, it’s clear that about half of all business leaders are still coming to terms with digital business transformation as a concept. The simple fact is, many of them will never get there at all. IT services providers need to protect their own interests, and technically and culturally vet any digital business transformation project before committing resources to initiatives that could very well drag both them and their clients down the proverbial rabbit hole.