European business leaders agree that digital transformation is critical to their future success, yet most companies lack a clear strategy for reaching this goal and typically regard the digitalisation process as a gamble, reports Fujitsu.
The IT equipment and services multinational has released a study, entitled ‘Walking the Digital Tightrope’, of IT decision makers from the UK, Germany, Spain and Sweden. Responses show that the pressure is on to digitise but there is a lack of clear ownership and IT investment is unclear and unstructured.
Despite this, Fujitsu says that the research reveals “a huge amount of industry-wide optimism” in digital transformation.
“Executives are confident in their own organisation’s ability to progress transformation projects and the overwhelming majority are in favour of moving even faster,” the group reports.
“There is also widespread agreement that failing to digitalise fast enough will lead to a sweeping range of penalties including loss of productivity, reduced business responsiveness to the market and problems with customer retention and loyalty.”
The survey was commissioned by Fujitsu and carried out by independent researcher Censuswide last October. Feedback came from 643 IT decision makers in the retail, finance, manufacturing and public sectors across the UK, Germany, Spain and Sweden.
Among the survey’s key findings:
• For 71% of businesses, the success of digital projects is a gamble and only 25% class themselves as ‘extremely confident’ in advising the business on digital. Six in 10 admit it’s difficult to know the right choices to make.
• Over three-quarters (76%) of those surveyed said there was an appetite to move fast towards digital adoption, with most of that pressure coming from the IT department/chief information officer (CIO) (23%) and customers (20%).
• Asked who manages digital projects, businesses were largely unclear. Every second business leader thinks digitalisation is a job best left to the IT department. However, in 40% of organisations digital is managed by the business unit involved in the project (25%) or by a separate digital team (15%).
• One in three executives think they are already over-spending on digital projects
• Organisations anticipate several benefits from digitisation, including the attraction and retention of talent (43%); market responsiveness (38%) and customer retention and loyalty (37%).
• Almost two-thirds (61%) state their organisation does not share a common view of where digital priorities should be, with 31% believing this to be the primary barrier to digital success.
• The majority of businesses (56%), believe IT budget has been split between digital innovation and day-to-day IT management, with digital getting the bulk of funding; while
27% have created separate budget to support digitisation.
• Two-thirds (65%) stated they would benefit from a more balanced approach to digital adoption
“When you scratch the surface, business optimism on digital transformation in fact looks more like bravado,” says Duncan Tait, chief executive (CEO) at Fujitsu. “Digitalisation is clearly hugely beneficial to businesses, although the current sentiment is more about conflict, confusion and imbalance.”
A measured approach
In response to the Fujitsu report, David Mills, chief executive officer (CEO) of printing and software group Ricoh Europe commented: “It’s no surprise that European businesses are found to be gambling with digitisation. [Our own] research shows that 34% of business leaders lack the resources to capitalise on the European digital single market (DSM), of which digitisation is a key component.
In an effort to streamline this process the DSM will tackle issues such as geo-blocking, copyright laws and simplify value-added tax (VAT) rules. It will standardise regulations so that the same content, products and services will be available at the same price anywhere in the European Union (EU). This should make it much easier for businesses across Europe to effectively digitise their offering and bring it to new countries.
“However, companies should not simply digitise for the sake of it. The key is to start by working out when you need to digitise, and where, to improve your customer experience – the benefits will then spread more widely. This measured approach provides a solid foundation and, crucially, instils genuine confidence in a digital strategy.”
However, a London summit on the industry’s introduction of the technology cautions that testing and acceptance are still at an early stage and firms should proceed with caution.
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