Why Do Most Digital Transformation Projects Fail? 5 Common Challenges to Getting Yours Right

Why Do Most Digital Transformation Projects Fail? 5 Common Challenges to Getting Yours Right

There's hardly any company — be it a Forbes Global 2000 or a striving start-up —  who's not already at some stage of its digital transformation journey. Everybody's turning the benefits of machine learning into “fuel” for their digital strategies. Everyone's leveraging some sort of “recipe for digital transformation success”, with AR, VR, analytics and cloud as key “ingredients”. And still, most digital transformation projects fail.

They're geared at streamlining operations, at creating and delivering the user experiences of the future... and nevertheless, they fail.

How come? Why do so many companies still struggle with their business model transformation, facing huge gaps between expectations and meeting? Why is it that only a few manage to get it right?

What impediments do they face?

What miscalculations have they made or what risky shortcuts have they taken? What confusions are they still making, thus paving their strategies' path to... failure?

Here are the 5 main reasons why so many companies still fail at digital transformation! Or “5 common pitfalls for you to watch out for” if you prefer:
 

1. Taking Digital Transformation for... Digital Optimization 

Some might deliberately derail from their digital transformation strategy (a resources-consuming and unpredictable one) and hop on the digital optimization bandwagon instead.

Or, even worse: there even are organizations confusing these 2 approaches!

So, just to clear up all confusions for good:

  • adopting and implementing the latest (disruptive or not) technologies in order to boost your current business processes' efficiency, to streamline your existing workflows, doesn't mean that you're actually transforming your business 
     
  • … this is optimized stagnation and not transformation, since you're only improving an already existing business model; by comparison, truly disruptive companies change their whole business models from the ground up
     
  • business model transformation is about daring to see beyond the “always been like that” business operations within your organization and about changing the model itself; going for a network or for a platform-based one, for instance

In other words: changing the way business operations are being carried out within your company (optimization) is a whole different thing from re-creating those operations from scratch (transformation). 
 

2. Overlooking the Digital Talent Gap in Your Company

And this is something that can crush your business model transformation strategy right in the bud.

It's by far one of the most common reasons why digital transformation projects fail.

Basically, overstretching your company's budget in order to bring in all the latest technology, but undermining the implications of any existing digital talent gap(s) is no less than... sabotaging your own strategy.

Are there any:

  • good DevOps engineers
  • artificial intelligence experts
  • data scientists
  • product managers capable to identify and to clearly articulate what your customers expect from your virtual assistant

… in your organization?

Run an honest audit of your current “resources” in terms of software engineers that are more than just “familiar with” the latest programming languages, product managers and other types of tech professionals. And detect any talent shortage.

Digital talents are your digital strategy's own power-engine, you know.

Looking the other way when it comes to cutting down the deficit of digital talent in your company and expecting your digital transformation project to be a major success is like:

Expecting your sports car to “burn rubber” on the highway... on an empty tank.
 

3. Digital Transformation Projects Fail Because They Lack Focus 

And this goes hand in hand with the lack of prioritization leading to under-investment.

You might be “tempted” to:

  • jump on that “steamy fresh” disruptive technology
  • ”juggle with” 2 or 3 (or maybe more) business models that you'd like to replace your current one with
  • replace all your legacy systems with new technology... in a day if possible

And thus your TO-DO list turns into the main cause of... distraction from your real goals.

Strive to keep your focus! Prioritize tasks in your digital transformation project and set up a much-needed hierarchy.

Otherwise, you're just wasting valuable capital and derail from your roadmap to business transformation.
 

4. Overlooking to Build Your Strategy Around Your Customers' Real Needs

It's “your” business, “your” strategy, “your" organization's digital transformation journey. See my point here?

If all these endeavors of “yours” don't accurately meet your customers' needs, they're nothing but high hopes lacking any fundament.

And this is another more than common pitfall that organizations fall into and the main reason why so many digital transformation projects fail.

Before asking yourself how you can:

  • automate your business processes or re-create them from the ground up
  • better allocate and deploy your capital (not just financial resources, but also innovative ideas and digital talent) to maximize your revenues

… you should ask yourself:

  • “What do our customers truly need?”
  • “How will our newly “transformed” organization be able to deliver them... true value?”

How will the “new” customer experiences that you'll be able to deliver post-transformation will be any more valuable to them than the current ones? 

These are all questions that should come first when you're setting up your digital strategy. Outshining the customer-centric approach to digital transformation with a... revenues-centric one is a key cause of failure.
 

5. Stubbornly Refusing to Break Free From Technology Constraints

And this is like stubbornly willing to keep carrying heavy weights attached to your legs.

There comes a time in every company's lifecycle when it should break free from all the business limitations and technical constraints of traditional, siloed eCommerce solutions.

And to go for lighter and more flexible ones instead.

Here I'm referring to headless e-commerce solutions replacing the conventional single-stack ones.

Why would you stick to single-stacks — back-end and front-end presentation layer being coupled and interdependent —  when you can leverage the bundles of conveniences and flexibility that a decoupled commerce solution grant you?

... when could instead you experiment freely at the presentation layer's level and craft fully interactive user experiences without the “dread” of doing any development in the back-end, as well?

I'm also referring to flexible cloud-based solutions replacing conventional, on-premise IT infrastructures. And the list goes on...

The END! These are the most common reasons why still so many digital transformation projects fail. 

How about you? Which of these "mistakes" could you already you plead guilty of? And what other challenges, impediments or/and trails would you add to this list?