Digital transformation has been a key initiative for enterprises over the past five years, however, progress has slowed. While the COVID-19 pandemic has been disruptive one of the positive outcomes has been a re-catalysation of digital transformation, with significant advances made in 2020.
Straight Talk IT
Adapting the enterprise to operate effectively in the digital world has been a key priority across most industries over the last half-decade. Omdia has been tracking enterprise’s progress in this digital transformation for much of this as part of its ICT Enterprise Insights program, a primary study of 6,500+ enterprises each year, asking CIOs to self-evaluate their digital maturity across nine key pillars. These cover the key strategy, people, process, and platform changes required.
Over the period, digital transformation evolved to become a widespread initiative, with 85% of enterprises last year having at least started some elements of digital transformation. However, while progress was relatively strong in the early years, relative progress in 2019 over 2018 was limited. The majority of enterprises remained at “in progress” or “early stages” across the pillars, with only a quarter of enterprises evaluating themselves as “well advanced” or “complete.” Admittedly, the bar for digital transformation is a moving one, but many enterprises seemed to be slipping back in their relative positioning.
2020 has been a tumultuous year for enterprises, with government responses to the pandemic have created major changes to the underlying operating environment for most firms. However, the silver lining is that it appears to have strongly re-catalyzed digital transformation. Omdia’s latest ICT Enterprise Insights program (launched in October 2020) found that over 40% of enterprises are on average in the more advanced stages across the nine pillars, with a strong contraction on the other side as well, in the proportion of enterprise that had either “‘not started” or felt that digital transformation pillars were “not relevant” to their firm.
Interestingly, one of the weakest pillars for sectors over the last half-decade has been around creation of a clearly articulated digital strategy; perhaps the area one would assume should be a good place to start in digital transformation. This has seen strong positive movement in 2020, particularly in sectors such as utilities, media, higher education, payments, retail, and retail banking. While perhaps not too surprising given the major disruption to physical business models in 2020, which have forced a switch to digital in most sectors, this seems to have helped formulate and set more defined digital strategies across the business.
While the promise of COVID vaccines hopefully offers the prospect of a more positive 2021, for most enterprises the shift to digital in 2020 is likely to be permanent one, and Omdia expects digital transformation to remain a core business strategy in 2021. Digital has become the “new normal.”
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