The tec(h)tonic changes witnessed by modern-day businesses reinforce that digital disruption is the way forward. And indeed, the C-suites have no choice but to re-imagine how they conduct their businesses by adopting new digital processes and tools — aka digital transformation.
Digital transformation is the ongoing process by which organizations integrate new tools and technologies across various business processes to enable their teams to be more productive and satisfied. Companies can perform digital transformation on a small scale like a Zapier integration or on a larger scale like overhauling their IT infrastructure.
But it’s one thing to recognize the significance of digital transformation; it is quite different to achieve it. For most businesses, the importance of digital transformation is not under question. But how to do it- so it delivers a sustained value-often is.
A recent BusinessWire survey of global 1,000 businesses and IT decision-makers revealed that while 94% of respondents accept the positive impact of digital transformation initiatives on customer experience, a more strategic alignment is needed to alleviate risks.
The findings suggest:
- Only 7% have sufficient resources to meet implementation deadlines.
- Only 43% of business leaders consult their IT teams on decision-making.
- A clear standard of ownership of initiatives is lacking.
- IT decision-makers feel that the implementation lags by an average of five months.
As you can gauge from this survey, nearly all businesses consider digital transformation initiatives as critical. Yet, their IT teams do not have access to enough resources and budget, nor are they given a prominent position in the decision-making process.
Unfortunately, the above mentioned are only a few of the many challenges organizations are faced with during their digital transformation. Still, they signify critical factors which can go wrong and spark a domino of failure leading to considerable losses in terms of investment and efforts.
And so, while the organization’s objective of undertaking digital transformation initiatives may be to streamline workflow, the process itself brings a tornado of challenges.
In this article, we have five major digital transformation roadblocks to consider in 2022 for being prepared to overcome them and embrace transformation.
5 Major Digital Transformation Challenges to Overcome In 2022
1. Resistance to change
The problem arises when everyone, from business owners to C-level executives, gravitates around which technology to adopt to accelerate their business and forget about their employees.
Digital transformation fundamentally changes the organization’s operating processes, giving rise to new roles and responsibilities. The uncertainties and discomfort around the cultural shift trigger friction to change from employees, marked by a series of emotional responses in the form of shock, anger, and denial. Adapting to the transition is still easy for start-ups, but it’s way too hard for businesses with legacy systems.
Resistance to change can be as little as adopting software to automate workflows. For example, using a tool like Jotform Approvals to automate approvals can help businesses streamline their workflows. Companies that are resistant to change will typically avoid adopting new software for a variety of reasons. Irrespective of the reason, resistance to change impedes the transformation progress, causing the businesses to lose out on vital growth opportunities.
So how do you enable employees to alleviate their doubts and dissolve the resistance?
- Communicate the ‘why’ of moving forward with new digital technologies, keep the feedback loop open with stakeholders, and have greater empathy.
- Build a comprehensive and unified change management roadmap that focuses on transparent communication and a company-wide mindset shift.
- Plan software training and onboarding that equips people to adapt to the transformation and deliver desired outcomes.
2. Lack of digital expertise
Digital technology and a digitally skilled workforce collectively form the basis for a successful transformation. But with a host of technical challenges the process brings along, businesses can’t sail through their transformation without the right expertise.
Unfortunately, the expertise required to navigate this arduous course is often scarce, and hiring dedicated talent for digital transformation can get extremely expensive.
So what’s the solution?
- Invest in education, training, and upskilling to ensure that the existing workforce will be digitally competent to integrate new tools in their work. This will help streamline operations in the business such as data organization, cross-team collaborations and more.
- Bridge the skill gap by working with an outside consultant who has the required technical proficiency. For example, if you’re working on an SEO project, it’s best to consult with an SEO strategist before taking on the project on your own.
- Leverage digital marketing to reach customers on all platforms. This includes using paid advertising, referral marketing, SEO and more.
- The future of work will comprise a distributed workforce. So, invest in the tools and systems to access the global talent pool.
3. Not letting go of legacy systems
Legacy systems are among the top bottlenecks. Many businesses continue to use legacy systems like old software, e-commerce platforms and other technologies to power their operations.
Firstly, the high maintenance cost is the most apparent issue with legacy software as support and updates for outdated systems are either rare or not available at all.
Secondly, its standalone nature drastically limits businesses’ flexibility, scalability, and integration with new technologies.
Thirdly, legacy software is inevitably more vulnerable to cyber breaches. So if you want to keep your infrastructure access secure, you should consider modernizing your tech stack.
Here are the best practices to let go of legacy systems while strategizing your digital transformation.
- The secret lies in stage-wise migration. Start by application modernization of the aspects that, when upgraded, deliver the maximum return on investment.
- Target inefficient internal processes where new adopting tools can minimize those inefficiencies.
- Avoid hasty decisions when it comes to adopting new technologies. Try new software and compare various solutions before adopting one for the long run.
4. Inability to keep pace with evolving customer expectations
Digital transformation is about the value businesses want to offer to their clients. But today’s customers are increasingly getting savvy at picking up newer digital technologies. Usage of a variety of digital channels is booming. The customer expectations are higher than ever. This has led to the digital gap- when consumer behavior evolves faster than most businesses evolve. Now, it’s on the organizations to bridge this digital gap to pursue their digital transformation vision.
Here are a few tips to consider:
- Gain a deeper understanding of your customers’ preferences to align the organization’s transformation goals with the customers’ needs.
- Focus on catering to more customers with a seamless multi-channel experience — email, social media, live chat, and self-service tools like a knowledge base.
- Invest in customer support and customer relationship management (CRM) tools that augment customer retention.
5. Limited innovation agility
Digital transformation is an ongoing process that evolves over time to meet changing needs of customers, industry, and internal stakeholders. Hence, fostering an agile innovation approach is vital for the digital transformation initiatives to work for its absence falters organization’s transformation ambition.
Innovation agility involves creating an innovation culture wherein rapid experimentation and prototyping are encouraged, wherein ideas flourish into viable products that meet customer demands and help create a customer-first business.
Here is what organizations should consider for instilling innovation agility:
- Prioritize the most critical problem. Then, encourage innovation to tackle the most pressing pain points of the end-user in a way that delivers the greatest value.
- Build a solid groundwork and define governance to support innovation where people are free to experiment, improvise, and fail without the fear of retribution.
- Use the latest cybersecurity tools. For example, using a virus scanner to detect malicious PDF documents
- Develop innovation labs, hackathons, and initiative hubs.
Digital transformation challenges are overwhelming and remind us that adopting cutting-edge technology alone does not guarantee a successful digital transformation.
While these challenges could be holding numerous businesses back from exploring better technologies, not embracing digital transformation within your enterprise to watch it grow obsolete isn’t an option either.
What entails is to learn to prepare for, identify, and overcome these issues by dissolving barriers to change, instilling company-wide change management, communicating to the stakeholders about the motivation behind the transformation, upskilling the workforce to help them adapt to new technologies confidently, adopting an agile approach, putting together a suitable strategy to upgrade the existing legacy systems, and delivering on excellent customer experience.