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Blog of Roman Trytyachenko

Is IT Failing Digital Transformation?

Digital transformation is an important part of IT. On the one hand, it has moved technology front-and-center within every business function. On the other hand, the majority of these digital transformations fail, and when business leaders look for the scapegoat for these failures, they often blame IT.


What is the reason for business blaming IT?


The general criticism that IT is the cause of digital transformation failure seems to sound reasonable. IT is the face of all things technological, so it feels normal to blame IT if anything connected to technology fails.


But the case doesn’t stop there. They get specific. They also argue that:


IT is too slow to manage a fast-moving digital transformation.

It doesn’t know how to work with digital infrastructure.

And has a hard time managing the complexity of digital technology.


Unfortunately, each of these arguments has some truth. IT does need to learn how to operate the new digital infrastructure, lead digital marketing optimization, manage increasingly complex environments and move quicker, as their stakeholders now demand that. But when you look closely at these problems, and the information on digital transformation failure, you see that it might be wrong to pin the blame only on IT.


The real truth about failure of digital transformation


In the real world, most of the business’ problems with IT and digital transformation are operations problems and implementation. But when you look at digital transformation failure, you see most of it springs from problems with digital technology strategy:


A lack of clear and concise strategy is one of the key barriers to digital transformation.

93% of companies with strategically harmonized digital initiatives are “more efficient”, engage better with their audiences and gain a competitive edge. That is in comparison to 63% of companies that don’t have a cross-departmental digital strategy.

Forbes research shows that what really makes a difference in a company’s value and performance is a digital business model, not just a few digital projects.


The point is clear. Digital transformations are more likely to have success when there is an enterprise-wide, clearly articulated brand strategy driving it. And it’s more likely to fail when there is no strategic approach behind it. Wide leadership and the lack of organization, but not an ineffectual IT function, is the real cause of digital transformation failures.


Don’t blame IT for bad digital strategy of digital transformation


In most organizations, IT doesn’t have a strategic role in digital transformations, so you just can’t blame it.


Only 7% of business executives state that IT is leading their organization’s digital innovations and ideas. On the ground level, IT led only 22% of digital initiatives (in comparison to 29% of individual business units, and 24% of dedicated digital units). And at the top level, CIO owns only 19% of digital transformations (in comparison to 34% of the CMO, and 27% of the CEO).


It’s really hard to blame IT for the business strategy failure of most digital transformations because IT isn’t setting it for those digital transformations in the first place.


Who’s to blame?


Of course, this opens the question: If IT isn’t to blame for killing digital transformation then who is? Who is responsible for digital transformation in most companies?


In most companies, you can’t blame anyone specific for digital transformation strategy failure. That is because it appears no one is setting and leading the strategy for their organization’s digital transformation. Only 21% of organizations have an implemented coordinated strategy and cross-functional digital initiatives.


Opportunity for IT


No one from the business is stepping up or believes that they are able to step up, to lead their digital transformations.


Less than 40% of companies think that their business leaders can derive value from the new technologies and lead their digital transformation. If anyone in the business starts doing something - it’s the CMO. But it lacks the cross-functional view of the business to deliver strategic, effective digital transformation, as the scope of digital will unavoidably extend well beyond their remit and into functions such as development, research, and supply chain.


The only function within the organization that has this cross-functional view required to connect a comprehensive, full digital strategy is, ironically enough, the main scapegoat for digital transformation failure -IT.


But we would like to take this thought one step further. IT is not just a crucial collaborator on digital transformation strategy. IT is the only function that has the cross-functional perspective and technological expertise required to develop an effective digital strategy.


And until IT has the chance to do so, the business can’t blame their organization’s digital transformation failures on the function charged with operating and implementing a strategy that they did not write, and which never had a chance at success.

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