Organisations risk wasting millions of dollars in the next 12 months as they rush into flawed digital projects, research from Couchbase has found. In the survey of 450 heads of digital transformation in enterprises across the US, UK, France and Germany, 52% said a fixation on digital transformation had raised the risk of rushing into ill-thought-out projects, meaning that much of their average planned spend of US$28 million in the next 12 months could be wasted. This risk of rushing in is being driven by mounting pressure to transform: 85% of respondents said disruption in their industry has accelerated over the past 12 months and 86% believe businesses will have to adapt to providing digital services in the next 12 months, or accept they will become less relevant. However, businesses that can adapt to this pressure can show significant success: 6% have completely revolutionised digital experience to the extent it’s now unique in their industry.
Other findings include:
- 95% of respondents believe that digital transformation can seem an insurmountable task – meaning projects are more likely to be unsuccessful
- Organisations spent an average of US$24 million on digital transformation projects in the last 12 months
- 35% say the primary driver for digital transformation is advances made by competitors, 23% changes in regulation and 19% pressure from customers – meaning digital transformation is mostly being driven by reactive needs, instead of proactive ideas
- Businesses have limited time to get this right: 64% believe those that can’t keep up with digital innovations will go out of business or be absorbed by a competitor in fewer than four years
- There are personal consequences of failed digital projects: 83% of respondents said they would face being fired if a project fails
- Despite these pressures, organisations are not standing still: 25% have either completely revolutionised (6%) or transformed (19%) digital experience in the last year, compared to 15% in 2017
Digital transformation has been mostly driven by the IT function: 76% of organisations rank it in the top three business functions driving their digital transformation in the last five years. Business executives also have a substantial say, with 47% placing them in the top three. However, other functions are far less represented, suggesting that transformation is still seen as the domain of IT instead of something that should concern the entire organisation.
Digital transformation is also still being held back by technology. Eighty-eight percent of organisations have had a digital project fail, reduce in scope, or suffer significant delays because their legacy database couldn’t support it. Indeed, this reliance on legacy databases and competing priorities has raised a number of issues, including:
- 87% of organisations find they have to scale back ambitions for new applications and services so that they will work with IoT or mobile devices – since these devices cannot match the data processing power of larger servers and cannot guarantee a consistent connection
- Only 29% of organisations say they can use data in real-time, limiting the end-user experience and the types of services they can offer
- 74% of organisations rely so heavily on their legacy databases that they cannot adopt newer database technology as quickly as they would like
- 83% of respondents are under increased pressure to secure their organisations’ database – laying bare the threats organisations face and taking attention away from transforming new services
The report is based on an online survey conducted in June and July 2018 by Vanson Bourne, an independent market research organisation, of 450 heads of digital transformation, such as CIOs, CDOs and CTOs, in organisations with 1,000 employees or more in the U.S., U.K., France and Germany.
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