Has Digital Transformation Taken a Backseat With 2021 Approaching?

In 2020, digital transformation projects entered the fast lane, but have companies entered the comfort zone and delayed their digital transformation initiatives as the year is coming to an end?

The pandemic disrupted the growth trajectory of businesses across different verticals and served as a catalyst to digital transformation. To strive in this economic downturn, digital transformation became a necessity for organizations to adapt to the volatile and ever-changing environment. The pandemic forced companies to make major financial cuts and fast-track their digital transformation efforts to meet their employee needs and customer demands.

A survey by Gartner in September 2020 foundOpens a new window that 69% of the board of directors accelerated their digital business initiatives, and 50% plan to change their organization’s business model in the wake of COVID-19 disruption. Digital transformation is responsible for essential business operations, such as cloud migration, automation, and modernization of legacy systems and infrastructure. 

Although digital transformation is a primary goal for IT leaders, Global Data Centers, a division of NTT, revealedOpens a new window that half of the digital transformation projects are delayed due to a hesitancy gap and complexity of connecting the multi-cloud services that underpin their projects. As the world navigates into the new normal of remote working, organizations that further delay their digital transformation initiatives will lose their market share to digital-first companies. The latest report by GlobalData, Tech, Media, & Telecom Themes 2021Opens a new window , found that companies need to begin digital transformation now to survive in the new world.

Cyrus Mewawalla, head of thematic research at GlobalData, saidOpens a new window , “Targeted, tactical digital transformation will be vital for companies to survive in the new world. This is good news for IT services, infrastructure, and application software companies, which have struggled in 2020 as many enterprise IT projects have been delayed, scaled back, or canceled.

“The way we work, shop, eat, seek medical advice, socialize, and entertain ourselves has fundamentally changed, and there is no going back. Like all industries, the technology, media, and telecoms (TMT) sector must plan for multiple eventualities.”

The report identified that funneling budgets for digital technologies rather than saving will help companies survive and thrive amid the pandemic. Comparably, IDC’s new reportOpens a new window has forecasted that 75% of organizations will have comprehensive digital transformation implementation roadmaps, and the global spending on digital transformation will rise to $6.8 trillion by 2023.

Companies will rely heavily on emerging technologies, including AI, IoT, automation, cloud computing, cybersecurity, to recover from the COVID-19 induced economic downturn, according to the report. A tech prediction made by the industry experts on Toolbox explained how overhyped technologies AI and RPA will enter the mainstream and witness an explosive growth with well-defined use cases.

In contrast, a reportOpens a new window by Spiceworks Ziff Davis predicted that IT leaders would continue to invest in emerging tech, but the adoption plans are expected to drop significantly year over year.

Peter Tsai, a senior technology analyst at Spiceworks Ziff Davis, said, “This year, the pandemic affected these future-looking tech plans as organizations scrambled to meet very urgent and unexpected challenges rising from COVID-19.” However, Mewawalla concludedOpens a new window , “What we do know is the world relies on technology, and it will be the beating heart of its recovery.”

As the pandemic continues, 2021 will not be the same. Small and medium-sized businesses (SMBs) will need to prepare and pivot their needle toward digital growth. From changes in business operations, work culture to becoming a cloud-first business and leaning heavily on emerging technologies, 2021 will be the year to drive innovation in the new normal. With heavy investments and strategies in digital transformation initiatives, tech-enabled companies will become more resilient to future disruptions.

Is your company prepared for the digital future? Comment below or let us know on LinkedInOpens a new window , TwitterOpens a new window , or FacebookOpens a new window . We’d love to hear from you!