APAC Businesses Suffer Wasted Investments in Digital Transformation

An IDC survey undertaken for Endava, a global provider of digital transformation, agile development and intelligent automation services, has found that an overwhelming majority (88%) said that only 50% or less of their DX projects in the past year met the expected goals or outcomes.

And when businesses miss the mark on DX projects, it's not just their infrastructure or competitive position that suffers. In Asia Pacific specifically, a majority (66%) of respondents felt their organisations' investments in digital transformation projects had been wasted.

While globally 62% reported failure resulting in them being less technically mature than competitors and having a longer time to market, key challenges damaging the employee experience emerged as consequences too. Many are facing frustrated staff (56%), as well as a rise in staff attrition (50%) and a less stimulating work environment (44%).   

The causes of lacklustre results from digital transformations reinforce the notion that strategies too often neglect to prioritise a people-first approach in the planning, design and implementation of digital initiatives. For example, 39% of respondents indicated that a lack of employee buy-in was a key reason for failing to meet expected outcomes, implying a need for cultural considerations to encourage user engagements.

This was followed by conflicting opinions from leadership (36%) and a lack of collaboration internally (33%), demonstrating a struggle to successfully navigate organisational dynamics or engage stakeholders throughout projects. When reflecting on failed DX projects, over half recognised that investments would have been better channelled into people-centric projects such as upskilling staff (55%) and improving IT and line of business communication (50%).  

Amid the rapid advancement of AI and the generative AI boom over the last few years, the survey also uncovered strong levels of current implementation and adoption plans in the pipeline, with over half (51%) of the Asia Pacific respondents having already deployed AI in their organisation or running a proof of concept. Many organisations recognised the impact of retaining a human influence on their use of AI, with 51% declaring it as very or extremely important. It is worth noting that Asia Pacific businesses recognise the value that AI and automation yield, as the majority (69%) foresee that these technologies will provide clearer, more transparent communication. 

Similarly, automation strategies were aimed at empowering a stronger employee experience and freeing people to work more strategically. 58% said their automation strategy is highly or very highly focused on removing mundane tasks and 54% agree that employee engagement and satisfaction is integral. The data on DX shortcomings, however, highlights a gap between many businesses' intentions for digital projects and the ability to bring these to fruition.  

Despite this, for those who do get DX projects right, there are promising employee and customer outcomes beyond the business benefits. As well as achieving outcomes such as process optimisation (62%), cost reduction (57%) and revenue increases (53%), respondents also reported improved customer experiences (45%) and an uptick in employee productivity, satisfaction and retention (42%) when initiatives were effectively managed.  

Endava CEO John Cotterell commented: "The success of digital solutions is inherently reliant on understanding how people will respond to new technologies. This research reinforces the fact that nurturing amazing products and services demands a human-centric approach throughout every stage of digital evolution. In practice, this is all about people, understanding user needs and expectations, working through cultural barriers to adoption and collaborating with employees to build engagement from the outset.  

"It's encouraging that more and more businesses are recognising the importance of human response to new technologies, as well as the potential impact of not prioritising people within technical development. As they shape their digital strategies for the year ahead and beyond, developing inclusive digital solutions and constantly being mindful of people will go a long way towards bridging the gap between innovative products and market success."  

IDC surveyed 601 businesses globally on the impact of DX on their businesses, the rate of failure of these projects, and where investment would have been better spent. Geographically, 42% of respondents came from Europe, 33% from North America, 17% from AsiaPac, and 8% from the Middle East. Respondents came from Retail and Wholesale (21%), Financial Services (20%), Healthcare Service Provider (21%), Mobility (19%), Telco and Media (19%) and spanned from 250-2,500+ employees.