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Digital Transformation Pitfalls and How to Avoid Them

Digital Transformation Pitfalls and How to Avoid Them

December 22, 2020
by Svitlana Luts

Digital transformation is everywhere. Worldwide spending on technologies is immense and it is predicted by the IDC spending guide that the number of investments in digital transformation will reach $2.3 trillion in 2023.

Nevertheless, 70% of all digital transformation initiatives do not reach their goals. According to the WSJ survey, digital transformation risks are executives’ main concern. Why do most digital transformation efforts fail? What can businesses do to avoid digital transformation pitfalls?

Here are five dangers that make up a hidden iceberg of digital transformation.

#1 The absence of a digital-savvy leader

A digital-savvy leader is key to data-driven transformation. As reported by Mckinsey, companies having senior leaders holding critical roles at the organization significantly increases the chance of transformation. A brand-new position that has become critical for successful digitalization is the chief data officer (CDO). The chief data officer is someone responsible for the utilization and management of data across the organization. NewVantage Partners survey shows that 62.5% of participants agree that when their company had appointed a CDO, they saw convincing changes in the digital transformation process.

According to Accenture to implement successful digital transformation strategy companies need to employ chief marketing officers who can establish synergies across company departments, invest in partnerships with clients, and build customer loyalty.

#2 The imbalance between technology and business strategies

Business strategy and technology strategy must correspond to each other. IT budgeting and software projects must be tied to the entire business strategy to sustain new initiatives. Let’s imagine a business requires to collect certain data as a part of digital transformation. In that case, companies should analyze all the data using AI systems. If the AI solution needs better core processors and the problem is in the state of the system then all the data was collected in vain. Thus the main problem is that company has a strategy that works theoretically but in fact, lacks technological resources to keep up with business plans.

To avoid this digital transformation failure, companies should make sure they have a software engineering team who works on the tech part of the project.

#3 Relying only on in-house members

The typical problem for the companies who want to go digital is having difficulty finding local experts who will understand the requirements and implement the solution. Building the entire technology stack in-house may lead to extra expenditures, lack of resources, and take more time than it is supposed.

Read on: How long it takes to staff an engineer in the US: how outsourcing can help you

#4 Losing track of the client experience

Another digital transformation mistake is losing track of the client experience. When a customer uses an app and there are poorly implemented features it can frustrate clients. When leveraging the advantages of technological breakthroughs, businesses must keep an eye on the customer experience and look for feedback from the users to ensure that digital transformation benefits don’t come at the expense of the customer experience.

#5 The project is not thoroughly planned

Digital transformation projects offer incredible benefits to a company, and usually, execution requires multiple departments to get involved. Nevertheless, these projects aren’t often seen as important as expansion projects. If there are no thoughtful project management digital initiatives won’t be successful. Digital transformation implementation is exciting, but the opportunities turn into profit when there are an intention and proper planning.

What should companies do next?

To be fully armed and reap all of the benefits that digital transformation brings to the table businesses should have a team of qualified software engineers under the leadership of a project manager, business analyst, and chief marketing officer.

Contact our experts to talk about your technology needs and implement your digital transformation strategy.


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