Has the flurry of pandemic-fuelled IT spending translated into faster, deeper digital transformation (DX)?
Not necessarily, according to new data from Tata. (Yes, I have absolutely been waiting years to write a sentence that kind of, sort of rhymes like that.) After surveying 750 enterprises in 11 countries, Tata concluded that due to COVID-19, “many businesses (have) raced to establish a digital-first operating model.” Despite those efforts, Tata reports that:
- only 10% of the surveyed companies are “digital trailblazers” with “the most advanced digital operating models”
- more than one-third of companies (38%) are still “digital aspirants … at a nascent stage of digitalizing their business (who) have been unable to achieve growth due to lack of digital maturity”
Sped-up DX spending
COVID caused enterprises around the world to open their coffers and acquire more technology. Based on global figures and projections from Deloitte:- 2020: enterprises spent an average of 4.25% of their revenue on technology (up from 3.64% in 2018)
- by 2022: tech spending is expected to rise, yet again, to 5.11% of revenue
- accelerated their digitization of customer interactions by an average of three years
- accelerated their adoption of digitized products and services by an average of seven years
Weak spots
Just like the Wi-Fi signal in your WFH office (your kitchen, bedroom, rec room, etc.), there are weak spots in many DX strategies. One glaring weakness identified by Tata is connectivity itself: 45 per cent of the firms it polled said “employee productivity has been adversely affected as a result of unstable or weak connectivity platforms in their business.” This means almost half of companies can’t deliver on one of the three tenets in Tata’s model of a digital-first organization: a hyperconnected ecosystem. Tata says this ecosystem entails:- “connecting people, data and assets anywhere, anytime”
- “mov(ing) away from legacy processes”
- evolving beyond “a patchwork of different digital strategies and processes across their organizations”
- “go beyond shifting some business processes online”
- create “a coherent digital operating model that, over time, reimagines every core channel, process and service offering to maximize the digital opportunity”
- 44% of organizations have not fully committed to a digital-first operating system
- 91% say they’re not able to provide high-quality digital experiences for their customers, employees and business partners
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