In The Wizard of Oz, Dorothy Gale is not quite sure what to make of the new landscape she finds herself in. After all, the land of Oz is a colorful and exciting—albeit unusual and confusing—new place. One thing she observes accurately: “Toto, I have a feeling we’re not in Kansas, anymore.”
There are probably a good number of C-suite members who feel much like Dorothy in today’s pandemic-affected new landscape. To say that the COVID-19 has impacted business is a no-brainer. The Dell Technologies 2020 Digital Transformation Index (DT Index), which surveyed 4,300 senior business executives from midsize to large enterprises across 18 countries, reveals how businesses have changed, what they’re grappling with, and the path forward to emerging successfully in the new technicolor landscape.
The Wicked Witch of the West
The sheer scale of the pandemic coupled with its abruptness has understandably taken a toll on companies, with many folding under the revised expectations and mandates of doing business during a pandemic.
If there’s a Wicked Witch of the West here, we could pinpoint a lack of investment in digital processes as one of the primary villains for so many companies’ unsteady performances. As the chips fall, it is becoming clear that enterprises that were already investing in digital and advanced technologies, such as artificial intelligence (AI) and Edge computing, have fared better than those who didn’t.
Senior directors at midsize to enterprise companies are buckling up for a wild ride. Almost one in three (32%) are worried their organization may not survive the next couple of years; a majority (60%) believe they will survive but will be badly bruised, shedding jobs, and taking years to return to profitability.
The take-home message for enterprises is clear: adapt or lag behind.
The Myriad Pressures on Senior Management
Adapting is exactly what many midsize and enterprises are doing. Eight in 10 businesses have fast-tracked some digital transformation programs this year, and 79 percent are reinventing their business model, according to the DT Index. The implications of which are wide-ranging. These companies would need flexible providers, a supply chain that can cope with a sudden ramp-up, and internal resources to manage these tidal waves.
Plus they need to vanquish some pretty embedded foes. Most (94%) midsize to enterprise companies face barriers to digitization. The big hurdles here include data privacy and cybersecurity concerns; lack of money and resources; and an inability to extract useful information from data. The last point is especially intriguing, as 91 percent of businesses agree that garnering valuable insights from data will be more important than ever before.
The barriers ripple down to team members, as well. While 89 percent of senior management executives are proud of the way in which their teams and organizations have adapted their digital strategies, the rush to digitize in the wake of the pandemic has come at a steep price. Nearly half (48%) of the senior directors surveyed worry their team members are at risk of burnout from the pressures to adapt to new IT strategies during challenging times and the rise of remote work.
C-suite members must then walk a fine line between charging ahead with digital strategies and ensuring the productivity and continued well-being of their teams—all while navigating uncertainty.
Follow the Yellow Brick Road
Given the many pressures on senior leaders, what supports can they lean on? What steps can leaders take to alleviate some of the barriers?
First, a consistent company-wide culture is key to digital transformation. Strong digital leadership is essential to identify projects that are low-hanging fruit and get enterprises firmly on the path to digitization. Given that less than a third of the leaders surveyed for the DT Index communicate with the C-suite to select suitable projects, the need for ownership for the process is apparent. Having strong digital leadership alone is not enough. Silos, even in the C-suite, need to be addressed so that the responsibilities of digital transformation do not rest solely with a chief data officer.
Second, companies need to commit to reinforcing an agile culture. While the move to remote work has rebooted that conversation—only 17 percent are hosting hackathons or other activities for innovative and group problem-solving—it’s time to refocus efforts on collaborative and quick solutions to challenges.
Senior business leaders should also be able to lean on a scalable IT infrastructure that can respond to black swan events such as a pandemic. Enterprises have a ways to go. While 73 percent of those interviewed have started investing in on-demand digital services, less than half are in the mature stages.
Finally, companies need to focus on technologies such as AI and Edge computing that will help them corral and process the data they are gathering and uncover key insights. Being mired in data is not an option.
Every enterprise of tomorrow needs to be data-driven, understand how to read the data tea leaves, and act on essential learnings.
The key takeaway from this year’s DT Index is that while pandemics or other sudden disruptions can’t be entirely avoided, they can be planned for. Digital technologies help companies stay resilient and weather severe events much more smoothly. Senior management needs to follow the yellow brick road of digital transformation to ensure continued competitive advantage now and in the future.