Firms Struggling To Make Data Transformation Reality
With “digital transformation” now a regular part of the tech lexicon, the pressure on IT leaders to make their organizations more competitive and meet changing customer expectations is huge. So it’s no wonder many are feeling overwhelmed by the amount of data their organizations have, and consequently, are not implementing initiatives as fast as their business counterparts would like.
Over 60 per cent of executives believe they are behind in their digital transformation, according to Forrester Research’s Predictions 2018: A year of reckoning report.
“Lagging results have created a loss of confidence in the CIO, driving up the number of chief digital officers and business units creating their own digital strategies,’’ the report notes.
However, the report lays the blame squarely on CEOs, claiming that “digital transformation is a CEO issue and an economic question” and that “CEOs can’t drive operational savings fast enough to fund it and are cautious about destroying margins.”
A more common perception is that deploying digital initiatives is a shared responsibility, especially as businesses are increasingly recognizing technology is a core component of their ability to operate. Regardless, the pressures are high, and efforts are low.
Businesses are building an appreciation for strategic IT but are not necessarily prepared to execute on that vision, observes Seth Robinson, senior director of technology analysis, at the tech trade association CompTIA. Seventy-eight percent of firms surveyed by CompTIA said that they are using technology to drive business outcomes, but only 28 per cent were extremely confident in their ability to apply technology to business goals.
Business and tech consultancy West Monroe Partners also finds that many company leaders feel prepared for the upheaval that emerging technologies represent – but few are actually ready for the operational, competitive, cultural and security shifts that are already taking place.
The firm’s 2017 study Technology is Transforming Everything: Businesses Struggle To Change With It, found leaders are overwhelmed by the volume of data and technologies their companies have access to, and what to do with it. The study of 300 business executives also concludes that many companies think they are prepared for deploying new technologies, but few are. Investments in technology alone will not automatically create business opportunity.
When thinking about data, companies first need to take a step back and ensure they are aligning their investments in data platforms’ capabilities with their talent pool and the business strategy, says Greg Layok, managing director of West Monroe Partners.
“It’s good to ask what’s the business strategy and how the data sources available to you can provide better insights to impact the strategy,” he says.
Then, it is often people’s instinct to take a tech-driven approach and build a data warehouse or data lake “to address the urgency they feel to provide insights from the data,” Layok says. “That’s the wrong approach. You have to figure out what decisions you’re trying to inform with the data.”
Compared with five years ago when people were talking about data analytics, the cloud has now greatly matured, along with tools to analyze data.
“Once organizations understand the insights they’re trying to inform, they can now map out their investments in technology and [people] resources,’’ he says. Then, they can interpret the data and create an environment that’s very innovative and will provide more insights on business issues.
The process for doing this involves coming up with what Layok called a “lightweight roadmap” that takes into account data governance, the people to drive the insights, the data platform for doing the analysis and how the data will be secured.
Cloud computing and consumer technology have built some expectations that may not always be valid, says Robinson. “Companies may believe that they can achieve complex technical solutions without considering the full stack of requirements and skills that are needed.” While there are cases where abstraction can drastically reduce capital or expertise, he adds, many firms are finding that there are more steps to their transformation journey than they originally anticipated.
Echoing Layok, he adds that, “As companies seek digital transformation, they will have to invest in building the right culture and also in the transformation of the IT function, including new skills and partnering opportunities.’’