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Global enterprises will spend some $4.4 trillion this year on technology acquisition, and more than a quarter of this on digital transformation. With new software investments approaching $700 billion, how well are these solutions being deployed to improve business execution in critical areas of e-commerce, marketing automation, customer experience, organizational collaboration and operational excellence? 

The CMO Council and the Business Performance Innovation (BPI) Network (www.bpinetwork.org) fielded a global survey of more than 250 enterprise executives (buyers, specifiers, and influencers) across companies of all sizes as part of its thought leadership partnership with HCL Software. The quantitative research fielded in Q3 2022 explored areas of focus and challenge in digital transformation; perceived value and benefits; as well as considerations and requirements for digital change agent/partner selection and success. 

Here's what our research revealed:

• An overwhelming 89% of survey respondents believe digital transformation is enabling enterprises to achieve greater business value, performance, and innovation.
• However, less than 12% of enterprise leaders are seen as highly strategic and adept at evaluating and implementing new technologies for competitive gain and growth. Most (44%) are seen as moderately strategic.
• Strategic understanding of customer needs and competitive market dynamics is viewed as the most important quality of a digital enterprise transformation partner or leader. Surprisingly, warm, human-based relationship approach; satisfied customer references and track record; and commitment to sustainability were least important to decision makers when evaluating a digital execution partner.
• In contrast, nearly 60% of survey participants believe sustainability is either highly or moderately strategic in realizing digital enterprise transformation growth objectives. Thirty eight percent expect an increased focus in this area. Pursuant to this, some 67% say they will very likely, or somewhat likely, select a vendor who helps them reach sustainability goals through digital innovation.
• According to respondents, the top five operational areas where enterprises can benefit the most from digital transformation are: 1) Digital commerce and multi-channel engagement 2) Data asset management, analytics and insights 3) Marketing automation and campaign execution 4) Revenue optimization and customer value creation 5) Business continuity, availability and agility.
• The three biggest obstacles to effective digital transformation in the enterprise are: 1) Cultural resistance to change and application uptake in the organization 2) Lack of digital enterprise transformation strategy and roadmap 3) Insufficient skills, capabilities, and digital leadership resources internally.
• Respondents believe the success of digital change agents in using technology to modernize or streamline business processes is most influenced by their ability to: 1) Evidence where and how digital solutions will deliver improved revenue and margin 2) Show how digital transformation creates competitive advantage and shareholder value 3) Achieve buy-in and support from the CEO and the C-suite influencers. 
• Software applications considered most vital to modernizing and automating enterprise operations are those dedicated to 1) digital transformation 2) data analytics 3) AI and intelligent automation 4) security, in addition to 5) focused industry solutions.

The online survey was conducted in Q3 2022 targeting executive business decision makers across companies of all sizes, industry sectors and geographies. Nearly 30% of the 254 respondents represented companies with annual revenues of more than $1 billion. Just under 10% represented companies with revenues of between $100 million and $1 billion. And a further 60% had annual sales of less than $100 million. 

So, what did we learn from this study?

Business, marketing and IT leaders around the world recognize a critical competitive imperative for technology to become a bigger driver of business innovation and growth. They overwhelmingly see the need to map and embrace digital transformation to accelerate business performance. At the same time, they also question the ability of management to lead strategically and activate resources inside and outside the enterprise to execute effectively. Organizational resistance to change is strong and migration to new cloud-based apps and platforms from legacy systems can bring both pain and gain, particularly as it relates to adoption, use and new levels of visibility and accountability. 

In this regard, we believe that the biggest and most pressing question raised by management and boards in authorizing funding for digital transformation today is: “But, can we execute?” Relentless and progressive end-to-end enterprise execution that is outcome-driven in a “digital first economy” is the new mandate. This requires predictive data-driven decision making, operational agility, functional modernization, automated compliance, customer-intuitive organizations, and higher levels of availability, scalability, and sustainability. Time for companies to gain a business lift from the digital shift!  

Related: Get ahead of the disruption! Become a CMO Council Member today!