New report reveals 97% of organizations are currently undertaking or planning to undertake digital transformation initiatives, but the vast majority say only a small proportion of their applications are integrated with each other.
A new report by application network provider MuleSoft has revealed a number of consistent difficulties experienced by global organizations as they undertake digital transformation initiatives.
The global study – which boasts more than 600 respondents across the US, UK, Germany, Netherlands, Australia, Singapore, and China – has found integration to be the key challenge. The vast majority of businesses say only a small proportion of their applications are integrated with each other, while demand on IT teams has grown well beyond budgets and capacity in many cases.
Customer experience continues to emerge as a key driver for digital transformation
The 2019 Connectivity benchmark report finds that 97% of organizations are currently undertaking or planning to undertake digital transformation initiatives.
While businesses are striving to increase their IT operating efficiency via digital transformation, customer experience is now the second most cited main goal for these initiatives.
Organizations are turning to digital tech – such as analytics – to fully understand their customers. The prevalence and accessibility of mobile and cloud technologies are helping businesses deliver a seamless experience across devices and channels. Furthermore, consumers are expecting efficiency across these channels – agile, real-time experiences which are consistent and satisfying.
But integration of digital technologies across fast-growing organizations remains incredibly difficult. Data, apps and even entire teams can remain siloed.
The report finds that the average number of apps used in global organizations is around 900, but the percentage of those being integrated has stalled at just 29% (the same proportion as in 2018). IT infrastructure is frequently to blame for these integration issues.
IT teams are increasingly the key enabler to implement digital transformation within businesses, but the proportion of budgets they can devote to this has remained stagnant. These teams are often required to do more with less year on year.
This lack of integration has a knock-on effect. While 97% of IT leaders say they are currently undertaking or planning to undertake digital transformation initiatives, just 36% believe that they provide a completely connected user experience across all channels.
There is a clear disconnect here, and serious doubts as to whether digital transformation among global businesses is progressing as it should be. Nine in every 10 respondents agree that not successfully implementing digital initiatives will negatively impact revenues.
A look at where businesses are investing shows – in the first place – how customer-centric digital technologies are, while also highlighting how much demand is placed on IT teams.
Security, big data/analytics, IoT, and AI/machine learning are all being implemented by organizations to either protect or improve the experiences of the consumer. But each of these technologies add extra strain on IT teams.
59% of respondents report that their team finds it hard to introduce new technologies because of their legacy technology systems, while 65% report that it’s difficult to make changes to a particular system or application as a result.
The key strategy among global businesses in light of these digital transformation difficulties is to hire more talent. 52% are planning to do just this in 2019, while 44% plan to outsource projects to contractors.
is also increasingly being touted as a route to improve the efficiency of application production and deployment, with 50% of respondents working to make more of their organizational processes automated.
46% say they plan to reuse software components and 39% are looking to leverage APIs.
For nearly all global businesses, digital transformation is clearly a fundamental part of their business strategy in 2019. However, even those who have made great strides in implementing digital initiatives across their organizations are struggling to ensure new technologies are integrated with each other as well as existing applications.
The result is quite a worry for IT leaders. Many speak of data silos where apps are not well-connected – and even entire teams are operating in semi-isolation. A vast majority of respondents highlight that integration needs to be happening beyond the IT department across business analysts, marketing departments, sales teams etc. too.
The drive to improve customer experience in a multichannel, data-centric, agile business context is fantastic for consumers. But IT departments are seeing resources stretched as digital initiatives, such as those concerning security and analytics, increase in importance and investment. This doesn’t look good for staff wellbeing on these teams, and many expect revenues to be impacted negatively if initiatives are completed.
Consequently, there is no magic bullet for improving integration and completing transformation initiatives. More budget, staff and outsourcing of projects will undoubtedly improve capacity for IT teams. But businesses need to be looking at DevOps, reusable software assets, and enterprise-wide API strategies to improve processes and efficiency – and to ensure digital technologies can really fulfill their potential.