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Challenges and risks of digital transformation and how to mitigate them

  • Almost every organization is pursuing digital transformation and in a study by Gartner, 91% of them are already involved in implementing some kind of digital transformation strategy

Challenges in Digital Transformation

According to the digital transformation report by Altimeter Group, companies undergoing a digital transformation have likely benefited from increased market share, customer engagement, and increased customer revenue. Digital Transformation provides organizations with the opportunity to redefine the way their business is run through the latest digital trends and tools. With new technologies being continuously developed and improved, organizations stay updated with the newest trends and integrate these innovations. Organizations started integrating technology into all parts of their internal and external operations. 

However, there are always challenges associated with any change management strategy. Businesses will face these challenges throughout the transformation process such as structural issues, technical barriers, faults in management strategy, etc. As a business owner, you should remember that these challenges are not directly connected to technological or technical concerns. To overcome them you need to identify and assess the specific problems that may impact your business. 

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Why is Digital transformation challenging for you? 

Digital transformation is not only embracing new software, technologies, and processes that are more efficient and automated than traditional business practices. It also involves adopting new business models that are core to your business. This tells us that organizations should understand digital transformation better and consider everything, from employee reaction to how it will impact their customers.  

Almost every organization is pursuing digital transformation and in a study by Gartner, 91% of them are already involved in implementing some kind of digital transformation strategy. As they are seeking digital transformation and digital technologies, they are also bringing in huge investments. But it's not that simple, 70% of all digital transformation programs aren't successful due to employee resistance and lack of support from management, and 49% of change management executives indicated that corporate culture is an obstacle to the successful implementation of change initiatives. 

Biggest Digital Transformation Challenges of 2023

Even though digital transformation can sometimes be challenging, its benefits make it almost unavoidable. Whenever a company goes through fundamental changes, it is in for experiencing various challenges and difficulties.  The same goes for digital transformation, if this transition does not occur smoothly companies are bound to face challenges.  We have mentioned a few important challenges to consider while undertaking digital transformation in 2023:

  • Lack of change management strategy

Companies with an in-depth change management strategy will likely meet digital transformation objectives. A strong change management culture is key to the success of any organization. It can be difficult but lacking that organizational change strategy leads to the failure of any new project plan. It can negatively impact an organization’s digital transformation, which is one of the primary reasons for the high failure rate. Additionally, organizational change management's main focus is the various components of an organization and not just one. It includes changes in culture, mindset, processes, and structures. 

  • Internal resistance to change 

Even in business, moving out of their comfort zone is tough as it gives them a sense of security. Changes can make people feel uncomfortable and organizations can experience employee pushback. This is the biggest challenge for organizations undergoing digital transformation- both from an implementation and data integration standpoint, as well as an end-user experience standpoint. 

A good way to manage this situation is by keeping employees engaged throughout the process and being transparent with those processes. Project managers should consider this in the early stages of transformation projects and pursue the most instinctive, integrated systems.

  • Lack of Expertise

You require a skilled high-performing IT team to succeed in your transformation efforts. When an organization looks forward to digital transformation, the lack of expertise can threaten its journey. Seeing how complex digital transformation strategies are, the proper knowledge and skills are required to implement the vital changes. Companies have reported talent gap issues that hinder the digital transformation process. 

The challenges organizations face include a lack of skill in cybersecurity, application architecture, data analytics, and data migration. For organizations taking steps towards digital transformation, set up an in-house team or have a digital transformation leader within your IT team to create and manage your IT strategic planning.  

  • Security related concerns 

As companies are moving toward remote work, digital processes, and cloud technology, they are under greater levels of risk. Thus they need to implement better security measures and enhance their cybersecurity to protect themselves against threats. Phishing attacks can target system vulnerabilities, poor setups, and unsuspecting users. Make sure you have planned something to rectify these threats before they occur actively. Hire a cybersecurity expert to help recognize shortcomings in your defense, as well as provide training to your employees.

  • Insufficient budget

Digital transformation is not an inexpensive investment. Some businesses may have faced significant losses in the past few years and for them, digital transformation practices may have been a setback due to budget constraints. As this is a big investment, businesses need to carefully prepare the budget and a strategy that will address and respond to customers' and organizations' needs. Comprehend your long-term goals and the ROI you want to achieve from the transformation process. 

How you can Overcome Digital Transformation Challenges

The challenges associated with digital transformation are overwhelming and some factors are beyond our control. Still, here are five strategies enterprises can implement to overcome them and lead their organization to a seamless transition to a digital future.  

  • Look for investing in a Digital Adoption Platform 

A new digital process doesn’t automatically guarantee success- you will need to provide proper onboarding, training, and support to your employees to empower them to use these systems better.  Investing in a Digital Adaptation Platform (DAP) is a good place to start. It provides organizations with low-code no-code tools to create in-app content that provides contextual learning and ongoing performance support. With a DAP they can create on-demand self-help with a no-code editor, helping to guide employees through digital tools, tasks, and workflows.  

  • Maintain transparent communication 

A recent survey at Gartner shows that 65% of the decisions made today are more intricate than those of previous years. They now consist of more options and stakeholders in the decision-making process.  To be a better decision maker you must maintain transparent communication and be open to all the stakeholders for feedback. This eliminates data silos and makes business decisions more circumstantial.

  • Upskilling and recruitment  

As discussed above, lack of expertise is a very common challenge of digital transformation. Businesses should keep in mind that they need to have skilled employees who can carry out the task, and when needed, they should bring in new employees with the required skills, expertise, and knowledge. Adding talents who are acquainted with digital processes and are fully dedicated to the transformation is an essential step toward success. 

  • Implement low-code no-code solutions  

One of the most effortless ways to mitigate digital transformation challenges is by implementing low-code or no-code solutions.  Apart from evading employee pushback toward new digital solutions, these let employees leverage new technology without requiring many technical skills. Check out the digital transformation services and solutions offered by Evon to overcome the obstacles in accelerating the digital transformation journey. 

  • Hire a digital transformation consultant

Every change cannot be seen as a digital transformation- it is a comprehensive realignment of core processes, tools, and experiences. Most organizations have never gone through a complete transformation process like this. It brings up a complex challenge to organizations that might feel discouraged by this process. But with a digital transformation consultant, you get the comfort of professionals who knows what they are doing very well. They also deliver a framework and foundation that will help you on your digital journey.  

  • Enhance your digital transformation security

Having a secure digital transformation demands continuous improvement in your cybersecurity department. You just have to have a monitoring system in place to resolve issues before they become high-risk violations. Organizations should enforce patch management to determine vulnerabilities when using third-party applications. They can also implement security controls, risk management, and policies, invest in new tools and technologies, and train employees.  

Remove Digital Transformation Obstacles

Successful digital transformation is not just limited to implementing digital technologies. Adopting cutting-edge technology alone does not ensure success. You will face internal and external challenges that can interfere with the transformation. Even though these challenges may look intimidating to some of you, with the right mindset, good resources, and effort successful transformation can be accomplished and the benefits will account for all the effort.

Evon Technologies, our software development company in India help you overcome these challenges by eliminating the roadblocks. We can also instill changes in your organizational structure and culture. Utilize flexible architecture to handle diverse technologies with a digital transformation company. Contact us or email us at This email address is being protected from spambots. You need JavaScript enabled to view it.  to build a scalable business.

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