Common challenges in the evolving digital world, and how to overcome them
It is commonly accepted that companies pivoted rapidly as the pandemic rolled across the globe and, in most cases, accelerated their digital plans. At first, this was an effort to cope with the 'unknown' – would this technology budget still be available next year if we don't spend it now? However, that stance evolved rapidly as the world responded to an increase in demand for digital services and online shopping. Consumer demand for seamless, efficient online services increased as well, with research suggesting as many as 18% of customers walk away from a sale if they don't receive a fast, smooth transaction.
Over and above a friendly and efficient interface, this requires back-end systems to work smoothly, data transfers to be seamless, and information to flow unimpeded across departments. Legacy systems need to be integrated with more modern ones, utilising data better throughout an organisation. Applications need to be tweaked and optimised. Services need to be adjusted, and new offerings brought online faster to respond to market forces.
Indeed, according to a study by IDC, 28% of organisations in the Asia Pacific region are in the last stage of digital transformation maturity, up from 18% of organisations in 2019, pre-COVID.
With this rapid change, however, comes a new set of challenges.
Below are five technology challenges that will help highlight potential pain points and suggest how to circumvent or overcome them on the path to a smooth digital transformation.
The timing conundrum
The majority of digital transformation projects are created using custom code, but developing it is difficult, costly and time-consuming. Many projects end in failure or take far longer to implement than planned. As consumer demand for personalised experiences rises, businesses subsequently struggle to keep up by writing vast amounts of code. At the same time, cyber attacks and malicious activity are on the rise. Developers need to guard against these factors at the same time as managing and maintaining the code they've written and keeping on top of demand for updated services. This all leaves very little time for actually coding and creating new products and services.
Companies are also facing a real, pronounced shortage of developer talent. As the Speed of Change: How Fast Are You report showed, no matter the digital and agility maturity levels, most companies are affected by skill shortages and talent gaps. However, according to Hays, IT project management is the skill in greatest demand within Australia, followed by software development. Hays states: "Significant demand exists for Software Developers as organisations look to improve their customer facing digital channels".
As such, the Australian Government has developed a Skills Priority List detailing which professions are most at risk of talent shortages. Software development ranks as an area of concern, as does website design and many associated fields. A recent report by Alpha Beta goes one step further, suggesting that Australia needs to find 6.5 million new digital workers by 2025.
Avoiding technology silos is critical
Many companies have to deal with a fragmented IT landscape. Over time, numerous duplicated applications build up, sometimes using non-standard architecture and poor security practices.
It is important to look at these as part of a digital transformation initiative and look to redevelop or integrate them – with little to no interruption to underlying business processes. Therefore it is important to find tools that can bridge the gap between business demands and available IT resources. Rapid application development is a big asset in these instances.
The ACT Revenue Office in Canberra underwent such a transformation in recent times and – deploying such a platform – managed to eliminate 90,000 annual paper notices, reduce external emails from 60,000 to 20,000 annually, and reduce the time taken to process refunds by 90%.
However, companies often start small - picking digital transformation projects focusing on areas such as 'improvement of customer experience', which require a specialised tool. Then, another team starts thinking about a back-end project and opts for a different specialised tool. This is followed by yet another team deciding to create operational dashboards and choosing yet another specialised tool.
With all manner of different tools for different functions, the overall functionality is compromised, with potentially useful solutions becoming entrenched in independent silos. Choosing a more robust technology to handle the different business initiatives from the start would have instead created a system of synergy and cooperation across all business functions, from finance to operations and through to IT. Therefore, it is important to assess needs properly and with a longer-term plan – thereby avoiding siloed information and systems.
Following on from the above point, technical debt – or technical sprawl - occurs when an organisation implements technologies for short-term benefits, usually as a result of prioritising speed over quality during the development phase.
According to a recent study, technical debt is estimated to cost businesses $5 trillion over the next 10 years. To put that in perspective, $500 million could be spent every single day on innovation and real digital optimisation for business growth. These systems either lie dormant – often with siloed information captured within them – or function partially with work-around solutions in place.
Such outcomes are costly and inefficient – but perhaps worse is the fact that they have a flow-on effect on future aspects of a business and, as such, often require 'cleaning up' years after their original purpose has expired.
Keeping up with the pace of change
While the needle has certainly moved as a result of the pandemic, there are many other forces at play that have an effect on technology evolution. New opportunities to disrupt markets are constantly emerging, and challenger technologies continue to innovate and rethink entire industries. Companies need to consider how they will constantly adapt to ongoing social and technological changes and how these will alter the way people use technology.