Organisations the world over have grand digital plans, many spurred by the pandemic, but fewer than one in three digital transformations are hitting their mark.
That is according to an analysis of nearly 900 digital transformations by Boston Consulting Group and presented to the World Economic Forum last month as part of the Davos Agenda for the post-Covid era.
“Our research shows that more than 80 per cent of companies plan to accelerate their digital transformation plans, against the backdrop of a global pandemic having accelerated the urgency of digital transformation for businesses,” write report authors and BCG senior partners Patrick Forth and Tom Reichert.
“But our research also shows that only 30 per cent of digital transformations have achieved their objectives, which is to say that they met or exceeded their target value and resulted in sustainable change.”
The majority of transformations (44 per cent) create some value but fail to meet targets and result in only limited long-term change.
More than a quarter of digital transformations (26 per cent) created limited value (less than 50 per cent of the target) and “produced no sustainable change”.
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Flipping the script
BCG says it has uncovered six areas from analysis on more than 50 factors that must be addressed in unison to create a successful digital transformation:
- Create an integrated strategy with clear transformation goals.
- Get leadership commitment from top and middle management.
- Deploy high-calibre talent.
- Adopt an agile governance mindset that drives broader adoption.
- Engage in effective monitoring of progress toward defined outcomes.
- Build a business-led modular technology and data platform.
The consultants note many companies address these factors already, but most are not doing so adequately. They also stress the six areas should be addressed together — companies successfully addressing only three or four factors still failed to transform on average.