According to research published by Boston Consulting Group (BCG), 94 percent of companies have grand ambitions to deliver substantial and rapid results from the digital transformation while companies plan to increase investment in digital solutions despite global economic headwinds. Interestingly, the majority of these digital transformations fail to achieve their objectives.
Titled “Mind the Tech Gap,” the study is based on a survey of nearly 2,700 executives driving digital transformations in companies across 13 countries and a wide range of industries. Despite a tightening global economy, the survey found that 60 percent of companies plan to increase their spending on digital transformation in 2023 compared 2022, with business model transformation and sustainability as the top two areas for future investments.
Christoph Schweizer, BCG’s CEO, said: “Many CEOs I speak with are grappling with the challenge of delivering their business strategy through major digital transformations. To tip the scales, we are doubling down on BCG X, our nearly 3,000-person tech build and design unit. BCG X will turbocharge BCG’s deep industry and functional expertise to enable innovation at scale and deliver successful end-to-end digital transformations.”
The survey revealed five key challenges in establishing and executing digital transformations:
- Making the right choices among disruptive technologies—the top three cited are advanced AI, blockchain and IoT
- Reaching scale fast with new digital solutions
- Recruiting digital talent—top three hardest tech roles to fill are experts in advanced tech, software engineers and data scientists
- Prioritizing investment and development
- Managing the cost and uncertainty of return on investment
David Panhans, leader of BCG X Middle East, added: “In order to capture the full growth potential in the post-pandemic future, GCC governments and corporations are undergoing or planning major digital transformation efforts to adopt emerging technologies and to provide end-to-end digital services. However, digital transformations are complex and often fail to deliver the expected results.”