What Are the Top Digital Transformation Challenges?

So, you have decided to join the digital movement and want to address issues related to legacy systems. Before creating a digital transformation strategy or roadmap, knowing and addressing the top digital transformation challenges is essential. 

This article will list the challenges of digital transformation that organizations must consider before building their digital transformation strategy. 

Why is digital transformation important for business? 

Digital transformation disrupts an organization's operational processes. It allows organizations to modernize their legacy systems, older processes, organizational workflows, and culture.

Read our ultimate guide on digital transformation: Digital Transformation Guide: An In-Depth Review for Undertaking Organizational Digitization Initiative

An organization's decision to opt for transformation affects business-wide operations. This decision helps them centralize their previously isolated processes and creates an opportunity of taking real-time data-driven decisions. So yes, to match the current competition and scale with efficiency, digital transformation is essential.  

Why do companies struggle with digital transformation? 

If not 100%, the struggle is partly due to human psychology. Yes, humans naturally struggle to accept any change or transformation. An add-on struggle or challenge gets created due to fear of not achieving the desired ROI, time estimation for achieving transformation, and the upfront capital investment. 

When the question arises, "Are you ready to make some real fundamental changes to your business?" The most prompt answer will be "Yes." But there are some common digital transformation challenges that pushback companies from taking such digital initiatives.

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What are the standard digital transformation challenges? 

Even though digital transformation helps organizations reimagine their business with digital technologies, digitized processes, and personnel, it will be met with challenges. 

Top digital transformation challenges 

Digital transformation is not just about integrating cutting-edge technologies into the business mix. It is about understanding which process requires innovation, where automation will profit the business, and where technology can improve customer experience. 

1. No digital transformation strategy 

The following questions must be answered before implementing any digital transformation strategy. 

• Why did the need to modernize the legacy systems and automate your manual processes arise? 
• Does your organization plan to implement an advanced technological stack? 
• Is your business well prepared to migrate the existing systems into modernized ones? 

Without creating a digital transformation strategy, the success of a digital project is not guaranteed. Never rely too much on any false assumptions or fancy terminology. 

Businesses must find areas where they can improve their organization's process and the areas which need immediate digital upgrades. 

2. Lack of IT skills 

54% of organizations said they could not accomplish their digital transformation goals because of a lack of technically-skilled employees. – Harvey Nash Group 

Finding a skilled and high-performing IT team is another challenge organizations face while implementing digital transformation efforts. The current work-from-home environment also factors in as a major challenge for businesses that are trying to find the right IT workforce for their digital transformation initiative. 

The significant challenges that are put in front of modern organizations wanting to take digital transformation initiative are lack of skill sets in 

• Cybersecurity 
• Application architecture 
• Software integrations 
• Data analytics 
• Data migration 

Organizations that lack IT professionals, with these skill sets, face roadblocks while implementing their digital transformation strategy. 

3. Budget constraints 

Budget is a significant pain point and often a challenge for digital transformation. Yes, investments in a new technology stack are hefty and should be considered completely before digitalizing. 

Plus, when an organization already feels pushback on the budget front, a transformation strategy will only make things tricky and start adding more delay to the entire digital transformation initiative. 

4. Pushback in accepting new technology stack 

New technologies are intimidating, and enterprise solutions are inherently complex. With legacy systems and manual processes integrated into an organization's core process, changes often occur at a much slower pace. 

Such an organization will have difficulty convincing the workforce about the benefits of automation and training them on new technologies. 

5. No change management strategy 

When you think of transforming the business, you think of including the latest tech stack that assists you in making profitable decisions. Throw in the use of new tools, combine it with employee resistance, and you can see the digital transformation initiative fail. 

This is where the lack of having a change management strategy abruptly spoils digital transformation efforts. Sometimes businesses are too focused on the technical aspects that they overlook or fail to consider the workforce, which is directly getting affected by the digital transformation initiative. 

Conclusion: You need a digital solution consultant to overcome the challenges of digital transformation 

While undertaking digital transformation initiatives, organizations' challenges help them prepare for any unwanted pitfalls. We hope this article helps you pinpoint those pitfalls and allow you to determine the effort you will require to achieve success. 

The ultimate change that businesses want to see in their processes requires a bold vision and failproof tactics, backed by practical and sensible shifts across their organization. 

Remember that transformation doesn't occur overnight, and it is not a one-time process. Stakeholders must be notified about the incremental changes that will take place over time. 

In the meantime, create a list that helps make the time, talent, and budgetary investments required for the transformation. You will need concrete process data to smoothen the decision-making process and help prioritize all the transformation activities. 

Digital transformation is a continuous process, and what is new today will be outdated 5-10 years down the line. So, your digital transformation strategy must be combined with long-term organizational goals and objectives. 

Rapidops has worked with organizations as a digital transformation consultant at every transformation phase. We have helped clients consolidate their business strategy and efforts with a more pragmatic approach keeping future disruptions in mind.