Digital transformation will be a $2 trillion market globally by 2020 according to the IDC. As technology becomes an increasing part of our everyday lives, it also becomes a vital part of business strategy, utilising emerging tools to become more efficient, cost effective, or in some cases, disrupt the entire market.
But, businesses are being bafflingly slow at jumping on the digital transformation bandwagon. A recent survey carried out by Microsoft and Harvard Business Review Analytic Services, found that less than half of their 783 respondents said their their organization has developed and communicated a formal business strategy for the digital future.
So what’s the hold up?
We’ve already got the tech.
Well, clearly, the problem is not the lack of suitable technology. In the past couple of years we have seen the commercial rise of technologies such as cloud platforms, artificial intelligence and virtual reality – once nothing more than mere science fiction. These new technologies have several business applications such as the use of AI chatbots in customer service. These will likely cut costs and increase customer satisfaction, but they are not being implemented nearly as much as they could be.
So, if the technology is already in place then what is delaying digital transformation?
The ‘people’ problem.
Well according to Henning von Kielpinski, business development director at ConSol, “digital transformation is more than technology, it’s 50% technology and 50% people.” The ‘people’ element of digital transformation can cover a variety of issues.
Firstly, implementing a digital transformation strategy has to be signed off by the CIO or CEO. Bruce Rogers, the chief insight officer at Forbes wrote , “Leadership through digital transformation has to come from the very top. Executives can’t just say it. They must live it.” Getting the top people in business to commit to a digital transformation is key to its success.
The skills shortage.
Furthermore, even if your leadership is on board, you may not have the inhouse capabilities to carry out digital transformation. The skills gap is making it harder to keep up with expanding technologies, there are simply not enough people to make digital transformation an option for every business. It also drives up the cost, especially if you are utilising niche technologies, as those with rare skillsets can demand higher salaries. The digital transformation challenge report found that finding professionals in specialised areas such as the internet of things was the most challenging for those undergoing digital transformation.
It’s clear that digital transformation is on the rise, but there is still work to be done for companies struggling to keep up. The IT skills gap is hindering progress in many sectors where transformation is desperately needed – especially when considering moves to more niche technologies like the IoT.