by Eric Vanderburg, Vice President, TCDI
Digital transformation reinvented companies in ways that can be considered nothing short of miraculous. It has challenged longstanding business models and introduced new ones. Just think about ride-sharing in the transportation industry or online and mobile options for personal banking. Moreover, digital transformation has morphed products into services and accelerated their delivery.
If you have ever run downhill, you know the feeling when your forward momentum seems to take a life of its own. Each step necessitates the next. Similarly, appetites for new products and services have not been satiated with the current innovations in technology. Rather, these appetites have increased, and expectations are high for businesses in almost every industry. Companies are aware of these expectations yet have responded by embracing digital transformation to varying degrees.
Digital Transformation Concerns
In 2019, Dell Technologies commissioned a study of 4,600 global business leaders and their progress on the digital transformation journey. The Digital Transformation Index II found that 78% of respondents believe that transformation should be more widespread throughout their organization and over half are worried about meeting customer demands over the next five years.
These findings are surprising to me because digital transformation has received so much attention over the last few years. There has been an abundance of dialog on digital transformation, but it appears that despite that interest, concerns remain.
I believe three main challenges are contributing to these concerns, but excellent strides have been made to overcome them.
Higher Demand for Privacy Protection
The digital landscape has seen an increasing focus on privacy as well as regulations surrounding it such the General Data Protection Regulation (GDPR) . This is made more evident in the lack of consumer trust in companies and a demand for transparency and accountability following headlines of opaque usages of personal data. In fact, according to the Index, nearly half of the business leaders are worried their organization won’t prove trustworthy in the next 5 years.
Companies can address data privacy challenges by integrating security into the Software Development Lifecycle (SDLC) and DevOps process; from design, development, testing, and deployment. For example, MGM Technology Partners was looking for a way to reduce the amount of time spent fixing security bugs encountered in their CRM system. Security bugs were discovered after software was fully developed and released which required considerable time and effort to address. Longer remediation time presented a greater risk that customer data could be exposed.
MGM Technology Partners began performing security tests on portions of code as soon as it was developed prior to production so that issues could be fixed quickly. This resulted in significantly fewer security bugs in released code and greater confidence in their ability to protect private customer data. The Digital Transformation Index II shows that almost half of the organizations surveyed are building security and privacy into devices, applications, and algorithms. At the same time, companies need to consider the ethical implications of how they use personal data.
Consumer Expectations are Increasing
Consumers expect to see product and service improvements to continue at a rapid rate. These expectations have risen equal to or even faster than most businesses can advance. Nonetheless, this is an excellent – if not necessary — opportunity for businesses to thrive in the future. almost 8 out of 10 business leaders surveyed by Dell are considering to harness emerging technologies to predict customer demands and manage resources
Lack of Digital Transformation Talent
Companies need digital transformation talent to keep up with the rapid pace of technology and changing demands of customers and partners. Some key skills include data analytics, problem-solving, information technology, and communication, a 2017 Robert Half study shows. In addition to these skills, accelerator programs can help to foster the creativity needed to innovate disruptive technologies and services. Furthermore, companies are increasing investment in digital skills and talents to address the shortage of skilled people. According to the Index, results indicate that this investment area has increased significantly from 27% in 2016 to 46% in 2018.
The Next Step Forward
Technology has the potential to revolutionize when integrated into business processes to deliver faster business agility and greater value to customers. The digital transformation journey is challenging but ultimately fruitful and essential for the modern company. Most companies are not there yet, but research shows that we are making strides to address digital transformation challenges. Each step leads us closer to the goal in a world brimming with opportunities.
This post was sponsored by Dell, but the opinions are my own and don’t necessarily represent Dell Technologies’ positions or strategies.