New research: How organisations achieve digital transformation

Learn how companies across the nation are really approaching digital transformation – with insights from a new survey of UK digital leaders.

Digital transformation is a challenge faced by organisations of all kinds and sizes. But it can be very hard to get clear information on how other companies are approaching the journey – and whether their efforts are resulting in success or failure.

To bring new insights to light, we at Elsewhen recently commissioned a research project to survey UK companies on their real-world experiences and opinions of digital transformation.

Elsewhen’s study of 200 senior decision-makers was conducted on our behalf by research firm Vanson Bourne in Q3 2022. We looked at digital progression within companies across diverse sectors including FMCG, retail and financial services. The majority of respondents (86%) work at corporations generating more than £1 billion annually, and more than a third (37%) are working with yearly IT budgets that exceed £10 million.

Optimism around digital maturity – but is it justified?

The pandemic may have sparked a great leap forward in digital adoption, but major UK companies are in denial about their level of digital maturity, according to our research. Nearly half (46%) report that their organisation's digital strategy is fully defined, implemented and optimised across the business, while more than half (57%) are "extremely proud" of their organisation's approach to digital projects.

Yet, this level of optimism may be misplaced – as the survey uncovered revealing contradictions: While 55% of respondents in the survey describe their senior leaders as "extremely digitally literate", 60% say that these leaders "don't understand how to use emerging tech" (such as AI and machine learning) to benefit their business. 

Facing a lack of clear digital vision

Similarly, while 65% of companies claim to have a fully implemented digital strategy in place, one fifth of these (21%) don't have a digital vision or a digital operating model. This suggests that a significant proportion of companies may have a digital strategy which does not include all the elements it ideally should.

Meanwhile nearly two-thirds (64%) of those surveyed agree that there are "big gaps between strategy and what can actually be achieved."

Calling for more digital leadership experience and commitment

This problem is particularly acute within IT departments. The IT decision-makers we surveyed (of whom 89% work in companies with an annual IT budget of over £1 million) complain of a lack of commitment from the organisation to the required changes (38%) and a lack of leadership experience in product (34%) as the top challenges they encounter.

Specific industries struggle even more. In financial services, 44% of those surveyed have come up against this lack of commitment from the organisation. Retail teams are also struggling against a "lack of leadership with technology experience" (38%), while 30% of those working in FMCG say they receive no clear ownership on digital projects.

Putting user experience engagement at the heart of the change

In more positive findings, the research shows that organisations are making customer and employee engagement central to their existing digital projects, with improved customer experience and improved employee experience a top priority for 51% of respondents. 

In terms of digital goals over the next 12 months, customer experience (52%) and employee experience (45%) significantly outrank other digital goals – including bringing new products and services to market (35%).

"It's great to see brands prioritising people by putting their customers and employees first," says Elsewhen co-founder and chief product & strategy officer Leon Gauhman. "However, this new data also confirms what we've seen anecdotally – that businesses across a range of markets are struggling to articulate the steps required to implement digital transformation.”

Making digital transformation a higher priority

Gauhman also highlights the shortfalls in many organisations’ digital initiatives: "While most brands understand the importance of digitalisation, the data shows that many aren't placing digital at the core of their organisation. What's more, a lack of knowledge, experience and managerial commitment is hampering progress, preventing brands from reaching their full digital potential. It's clear that leadership needs to play an even bigger role in translating digital ambition and strategy into effective, real-world and lasting results. This involves ensuring that digital technology and design leaders have a place at the table when it comes to shaping companies' strategic direction."

Recognising the potential costs of failure

The survey also highlights the costs of poor digital delivery, with projects that failed to meet expectations having far-reaching effects. These include revenue growth lower than expected (42%), failure to meet compliance requirements (41%), impact on budgets (38%), delayed product launches (36%) and IT security risks (35%).

Digital consultancies may have a powerful role to play here, with an impressive 100% of respondents describing their most recent third-party project as either meeting (45%) or exceeding (56%) expectations. What's more, longer-term relationships work best. Companies that rely on third-party digital services more than half the time are significantly more likely to say that the most recent digital project exceeded expectations (65%) compared to those who use the same services in half or fewer digital projects (46%).

"It's encouraging that consultants are delivering value around organisations' complex digital journeys," says Gauhman. "While major enterprises are increasingly hotbeds of digital talent, these results show that working with an unbiased, trusted partner will significantly improve the outcome of digital projects."

Watch the webinar to learn more

Find out more about how UK organisations are really approaching digital transformation in our new report, presenting the latest findings from our survey of digital leaders.

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