CFOs: The major barriers to successful digital transformation

Skills of the leadership team and the lack of collaboration among the C-suite, the IT team and wider business hold back digital transformation.

This is according to NTT Ltd.’s 2019 Digital Means Business Report, which is based on a survey of more than 1,150 executives from 15 countries and 11 industry verticals across Asia Pacific, North America, Europe, and Middle East & Africa.

Organizations worldwide are achieving some success with digital transformation, but there’s still a strong belief that this evolution requires radical, far-reaching changes to achieve success, NTT pointed out.

This, when combined with a lack of strong transformational leadership and focus on the need to change people, is holding many companies back, the firm added.

• Some 71% of organizations in the early stages of transformation still believe a complete restructuring of the business and operating model is the primary definition of digital transformation.

• Only 49% of respondents believe their leadership team has the right skills to manage the execution of digital transformation.

• Lack of executive sponsorship or ownership is ranked as the top barrier to success.

This shortfall highlights the need for business leaders to change themselves, build a different environment, and set new behavioural priorities and performance indicators in order to drive a more proactive, tactical, and incremental approach to transformation, Wayne Speechly, VP of Advanced Competencies, NTT Ltd advised.

The research also revealed there’s a direct correlation between organizations’ ability to realize relevant, outcomes-driven value from digital transformation on a regular basis, and their digital maturity, NTT said. Y

However, there still exists a discernible lack of alignment between IT teams and the wider business, survey results indicate.

• Only 29% of organizations are embracing digital transformation as a collaborative effort between business and IT.

• While 42% of respondents say business and IT are delivering in a more integrated manner, supported in part with the introduction of a Chief Digital Officer function, only 12% are highly satisfied that planning is flowing effectively through to execution.

• Almost half (49%) of digital transformation projects are still IT-led.

“Organizations should focus less on perfecting a grand digital plan, and more on taking considered and iterative steps in their transformation journey to progress value and clarity of subsequent moves,” Speechly said. “For various reasons, an organization is its own worst enemy, so any change has to be supported by pragmatic, self-aware leadership who are themselves changing.”