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Don’t let failed digital transformations prevent future attempts

August 30, 2022 Article 4 min read
Authors:
Alex Nekritz
Many organizations aren’t used to managing large-scale digital transformation projects. But to overcome the fear of tech debt, companies must structure endeavors to work for their unique teams and capabilities. In CFO, Alex Nekritz discusses a roadmap for success.
Two business professionals in front of digital analytics dashboards.Companies that adopt digital-first systems across operations, sales, marketing, and more can realize significant cost savings — cutting down on labor needs, leveraging data and business intelligence tools, and even reducing time to market. But, the fact is 70% of complex, large-scale digital transformation projects fail.

Why? A lack of employee buy-in, inadequate management understanding of what they’re getting into, IT systems that fall short, enterprise resource planning vendors that overpromise and underdeliver, scope creep, and the list goes on. Companies worldwide are expected to spend nearly $2.8 trillion annually on digital transformation efforts by 2025, so these failures represent a significant amount of waste that’s piling up on corporate balance sheets.

This reality leads to what I refer to as a type of “tech debt.” Although usually used to describe outdated technology holding a company back, this type of tech debt is more about the fear that can build up within an organization after failed technology projects. This form of tech debt can make it more difficult for management to invest in the right solutions to move the organization forward the next time around.

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