Editor’s Question: What’s the biggest challenge for Digital Transformation projects currently?

Editor’s Question: What’s the biggest challenge for Digital Transformation projects currently?

Digital Transformation, as the name suggests, can completely overhaul the way a business operates. But it is not an easy process and there is a lot to think about when taking on a project. The four experts on the following pages talk about the current challenges with regards to Digital Transformation, starting with Neal McMahon, Regional Sales Leader, Avaya:

The greatest challenge to Digital Transformation is the risk of business disruption. The prospect of making an abrupt change from existing business infrastructure and processes carries high risks for businesses, including potential disruptions to operations and customer service continuity. This fear of instability hinders innovation and the ability to drive new business outcomes.

However, the risks of not digitally transforming are also great. In today’s business landscape, the three most significant challenges facing business leaders are navigating the complexities of diverse customer expectations, the difficulty in recruiting and retaining top talent and the imperative to drive revenue growth amidst competitive pressures. Without improving customer experience (CX) as well as employee experience (EX) it is a hard slog to also improve the bottom line but by prioritising CX, companies commit to deeply understanding and fulfilling customer needs, ensuring every interaction is meaningful, which contributes to customer loyalty and advocacy. This focus on customer satisfaction directly influences the motivation and effectiveness of employees. A positive EX, characterised by a supportive work culture and access to enabling tools and technologies, fosters engaged employees who feel valued and supported and are more likely to stay with the company and excel in their roles. This drives superior customer experiences and, by extension, business growth.

Where businesses have taken an all or nothing approach to Digital Transformation by ripping out and replacing well-integrated systems and processes with entirely new solutions, the level of disruption caused can become counterproductive and often cause a misstep in the journey towards Digital Transformation. This approach not only disrupts established workflows but also risks losing the nuanced understanding and optimisations developed over time.

Here, a more nuanced approach to Digital Transformation is needed. Rather than starting from scratch, businesses should build upon and elevate existing systems. Not only is working with the right partner to help guide the transformation important but also using the right solution for your business needs. When it comes to an effective Digital Transformation project, one size does not fit all. Each industry and each business will have a unique set of needs. For instance, in highly regulated industries such as financial services, full cloud transformation is not possible due to data privacy regulations. Therefore, a hybrid approach may be more suitable, where secure data can be housed on-premises while other functions can be enhanced through the cloud.

But most importantly, Digital Transformation must serve to improve employee experience and in turn customer experience. Investments in CX and EX should not be seen as cost centres but foundational elements for driving sustainable business growth. By adopting this integrated approach, businesses can transform customer satisfaction and employee engagement into catalysts for revenue generation, market differentiation and competitive advantage.

Oleksandr Maidaniuk, VP of Technology, Intellias:

Jumping into Digital Transformation means more than one challenge, like adding new gadgets and apps to the workflow. It means addressing a dozen challenges at the same time. Digital Transformation is an ongoing process that requires stepping up your game and making sure your digital steps are not just trendy and cutting-edge, but strategic and legitimate.

One of the key elements and challenges lies in effective data management. Organisations often grapple with a mosaic of applications and systems accumulated over time, each functioning in an isolated silo. Poor data quality is a common issue here, where inaccuracies, inconsistencies and incomplete datasets undermine the reliability of information and complicate the overall Digital Transformation process.

The trick is to blend everything smoothly so data and tasks can flow easily throughout the company. It’s more than just ensuring technological compatibility; it also involves creating an environment that streamlines operations, inspires innovation and provides a competitive edge.

Organisations in highly regulated industries face an additional layer of complexity as they must adhere to regulations like GDPR, HIPAA and others. This requires a comprehensive understanding of the legal specifics of data protection and privacy. Not only may this lead to legal consequences, but it also jeopardises the trust of customers and stakeholders. As organisations strive to innovate and embrace Digital Transformation, they need to develop a robust and proactive approach to address regulatory compliance and data privacy. During the COVID-19 pandemic, the Intellias team supported the digitalisation and Digital Transformation of a national healthcare system that eventually helped over 23 million people vaccinate. When developing desktop and mobile solutions, the team obviously had to focus on data privacy and regulatory compliance as a core part of Digital Transformation since the project involved large volumes of patients’ personal data.

Process redesign is another core part of Digital Transformation, which is largely driven by almost biblical beliefs about doing one thing one way (never another way) and constrained by inefficient tooling. The goal is to rationalise your portfolio by replacing legacy, outdated components with better-suited technologies and integrating existing systems with modern technologies through off-the-self or owned solutions.

Getting everything to mesh well together means really understanding the tech and what makes our business unique. It’s a tightrope walk between tailoring stuff to fit us just right and sticking to tried-and-true methods that we know won’t let us down. With tech changing so fast, being flexible is key.

Jumping into Digital Transformation isn’t just about grabbing the latest tech. It’s basically about ensuring all the new gadgets and ideas we come across fit well with our company’s goals and how we do things. We should be focused on building a space where change is greeted with open arms, and fresh ideas are celebrated as chances to level up, not just extra hassles. For leaders who can navigate through all the complex details, the payoff is big. In this quickly changing digital scene, being good at handling the ups and downs of going digital can make you shine and bring some extraordinary opportunities your way.

Steve Leeper, VP Product Marketing, Datadobi:

Digital Transformation isn’t just about jumping on the latest tech bandwagon; it’s the secret sauce that really amps up your business game. Think of it as redefining the whole playbook on how you click with your customers – diving into the data pool to really understand what makes them tick and tailoring your offerings to keep them glued. With all the insights you could want just a click away, you’re the one calling the shots, ready to jump on new chances, dodge any trouble and tweak your game plan to get it just right. At its core, Digital Transformation is all about turbocharging your operational capabilities and syncing it perfectly with the market’s heartbeat.

For those trying to bring AI into the business mix it has really upped the ante for better data understanding and flexibility. Businesses are gearing up to really get into the nitty-gritty of their data, all to make sure they’re giving their AI and Machine Learning tools the cream of the crop in terms of useful insights. As they start weaving AI more tightly into their operations, understanding the finer points of their data is going to be key.

Next, we’re right at the edge of a big change in how we store data, mostly because the cost of flash storage is going down. As flash storage becomes more affordable, it’s likely to become a staple in object storage set-ups, providing the speed that traditional hard disk drive systems and the scalability that network-attached storage systems can’t match. We might also see a shift in data and workloads moving away from older, slower storage solutions to these state-of-the-art all-flash systems.

And of course, as data volumes grow, the demand for robust data management will rise. This move towards better solutions is happening because there’s just too much data and not enough IT folks to keep up. So, automating data management is becoming more of a must-have than a nice-to-have to manage all that data without getting overwhelmed.

Next, as the demand for API access from data management vendors grows, we can expect to see a network of applications that communicate effortlessly with each other. Picture IT Service Management (ITSM) or IT Operations Management (ITOM) software initiating tasks in other apps through API calls as a response to service requests – this level of integration is set to become the norm. Everyone’s really getting behind the idea of putting APIs first, driven by the goal to integrate data management more seamlessly. This is probably going to lead to more self-service apps popping up, which means a lot of the processes will be automated and it’ll be a breeze to get to the data management tools we need.

Last but definitely not least, risk management is super important. A lot of attention will be given to governance, risk and compliance as companies try to figure out how to manage all sorts of data challenges.

The biggest obstacle in Digital Transformation isn’t just about the tech – it’s about having a solid plan that spells out why you need it in the first place, all from a business perspective.

Markus Nispel, CTO of EMEA, Extreme Networks:

Digital Transformation isn’t just a choice; it’s a strategic necessity for companies aiming to stay competitive in the digital age. However, despite the promising benefits, Digital Transformation projects are not without their challenges. One of the most significant hurdles is data management. Although data holds immense potential for unlocking insights and driving intelligence, particularly with the help of AI, organisations often struggle with siloed data, fragmented systems and a lack of data literacy. Overcoming these obstacles requires a coordinated approach to foster a data-driven culture by dismantling silos, integrating disparate data sources across the organisation, enhancing data literacy among employees and establishing robust governance frameworks to ensure data quality and security.

Moreover, Digital Transformation initiatives must be guided by a clear vision and strategic direction. Without a definitive roadmap, organisations risk being overwhelmed by the vast sea of data and AI. Without a clear understanding of desired outcomes, they risk losing sight of their goals and becoming sidetracked by pursuing low-value use cases. This can divert their attention from achieving the broader transformation necessary to effectively revamp their business models. In such cases, they may lose focus on delivering new, unique experiences and products to their customers – areas where data plays a crucial role. Therefore, it’s imperative for businesses to align their digital initiatives with broader business objectives, prioritise high-impact initiatives and continually evaluate and adapt their strategies in response to changing market dynamics and emerging technologies.

As many companies continue to invest in AI tools to improve efficiency and drive Digital Transformation efforts, the lack of a well-defined data strategy threatens to undermine these endeavours. While AI holds the potential to revolutionise business operations, its success relies heavily on the availability, quality and integration of data. Without a coherent data strategy, organisations may face challenges such as inconsistent data quality, difficulties in accessing and integrating data, risks of security breaches as well as the emergence of data silos. Therefore, establishing a clear data strategy is essential to ensure that AI investments result in tangible benefits and contribute meaningfully to achieving Digital Transformation goals.

Challenges are often opportunities in disguise, and organisations can leverage them as catalysts for innovation and growth. By collaborating with partners and vendors, businesses can navigate data management challenges and configure networks to meet evolving expectations. This enables them to harness data as a strategic asset, driving efficiencies and insights and gaining a competitive advantage.

Digital Transformation empowers organisations to seize opportunities and drive positive change through agility, innovation and sustainability. With the right mindset, approach and infrastructure, businesses can thrive in today’s dynamic landscape by leveraging digital technologies for growth. Organisations need to act decisively to avoid competitors and newcomers capitalising on market opportunities.

Richard Bassett, VP of Digital, AI and Analytics, NICE:

The explosion in AI in 2023 has brought about significant changes across all industries, with a profound impact on customer experience (CX). With that comes immense pressure on organisations to implement AI as quickly as they can to keep up with their competition. This ushers in the biggest challenge facing organisations currently with starting Digital Transformation projects: implementing the right AI for their business. The marketplace is crowded with so many AI solutions it can be difficult to discern which AI is the best fit.  

The key to successful CX AI implementation is twofold:

  • First, an interaction-centric cloud platform: this involves storing all CX data on a single, open cloud platform. This step is crucial as it breaks down silos within organisations, giving AI access to generate holistic insights into CX operations. This also enables organisations to take action on AI generated insights, allowing them to initiate workflow and staffing adjustments and automation at the click of a button. 
  • Second, using Purpose-built AI for CX: this means harnessing AI that is built from billions of recorded customer interactions and designed with proper guardrails to ensure accurate and appropriate outputs. It transforms the level of service that companies can provide through chatbots by ensuring customers feel as though they are speaking with a human agent. 

Implementing purpose-built AI for CX with a cloud platform impacts the employee and customer experience. It not only enhances the level of assistance that businesses can provide through chatbots, but also improves the critical handoff from unassisted customer interaction to agent. If a customer submits a query via an online contact form and arranges a call back from an agent, AI can surface relevant information on that customer, so the agent has everything they need for a positive interaction. Additionally, when organisations follow this formula they receive 100% visibility into their CX operations, enabling them to make decisions much faster to optimise operations.  

Now, in 2024, the focus should be on selecting and implementing the right AI, which will be the single most important factor in reaping the immense benefits this groundbreaking technology can produce for both an organisation and its employees and customers in the long run. 

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