Good news: A growing number of businesses are investing in innovation strategies to future-proof their brands in an ever-evolving digital landscape, according to new research from Altimeter Group. However, for many companies, the “digital” in “digital transformation” implies technology, which isn’t the only part of the maturity equation.
Companies that are excelling from that standpoint are prioritizing the digital customer experience as well as the employee experience, according to the “2017 State Of Digital Transformation” report (short registration required). However, companies and their change agents still face big challenges in the pursuit of digital transformation, including a lack of digital talent and expertise (31%), the perception that digital transformation is a cost center and not an investment (31%), and general culture issues (31%).
“What we are finding is that when you interview companies, they claim they are farther along on their digital transformation journey than they really are,” said Brian Solis, principal analyst at Altimeter Group. “We’re seeing companies of all shapes and sizes that believe because they are investing in technology that they are advanced or mature. But digital transformation is just as much about change management as it is about technology.”
A lot of the investment into digital transformation strategies are viewed as short-term cost centers, with small budgets and resources, he added. Additionally, while the majority of companies that are in the midst of their transformations said the customer is at the heart of their evolutions, less than 39% have mapped the customer journey (down from 54% last year).
In years past, Altimeter’s digital transformation research has shown a rivalry between CMOs and CIOs as primary owners of digital transformation. This year is a different story. Today 28% of survey participants indicated that their CIOs/CTOs are responsible for digital transformation, 23% said it’s their CMOs, and CEOs moved into the third spot with 20%.
“What we’re seeing is there is not true leader of digital transformation,” Solis said. “Additionally, companies all have different reasons for their digital transformation. Some are investing in modern technology infrastructure, while others are centering digital transformation around keeping up with expectations around customer experiences. Whatever the purpose, my advice is that you have to start with fixing the inside and outside–employee and customer experience–where digital transformation becomes cross-functional and enterprisewide.”