Lack of executive leadership lowers digital project success rate

More than one in five organisations have experienced a digital transformation project failure, a new study from Couchbase has found.

According to Digital transformation: Are we finally past the unmet expectations?, the survey of 450 CIOs, CDOs and CTOs in organisations with 1,000 employees or more, 81% of businesses have had digital projects fail, suffer significant delays or be scaled back in the past year. More than four in 10 (42%) said they were currently either behind schedule or at risk of falling behind with their most significant digital transformation project.

The main reasons respondents gave for project failures and delays include the complexity of implementing new technologies (reported by 28%), challenges with existing legacy technology (27%), a lack of skilled staff (27%) and a lack of resources (26%).

The survey found that the average cost of digital transformation projects across the organisations polled was $28m. According to Couchbase, with the wrong drivers, even organisations that are investing millions in time, effort and resources into digital can see little or no return. Seven in 10 (71%) respondents agreed that businesses are fixated on the promise of digital transformation, to the extent that IT teams risk working on projects that may not actually deliver tangible benefits.

Many organisations also reported that complexity of technology, resource constraints and a lack of skills had prevented them from starting digital transformation projects. Among those that had experienced challenges that prevented them from pursuing new digital services or projects that their organisation wanted, almost one-third (30%) said their reliance on legacy technology was a contributing factor.

More than half of the organisations (52%) said their senior management was not driving their digital transformation strategy. Instead, the strategy was set by the IT team.

The survey also found that the primary drivers for transformation are almost all reactive. Responding to competitors’ advances, pressure from customers for new services, and responding to changes in legislation were each reported by 23% of respondents as drivers. Conversely, the survey showed that only 8% of organisations' transformations came from original ideas within the business.

Matt Cain, CEO at Couchbase, said: “In order for companies to succeed with their digital projects and overcome the inherent challenges with these new approaches, they have to attack the projects in a comprehensive and systemic way. Transformation is ultimately achieved when the right combination of organisational commitment and next-generation technology is driven across the entire enterprise as a true strategic imperative, not left in the sole hands of the IT team. The best technology will then help companies enable the customer outcomes they desire.”