NTT DATA: International study presents the key drivers of digital transformation projects

Current study by SAP® consulting firm NTT DATA Business Solutions AG and IT service provider Natuvion GmbH reveals:

• The main reasons for transformation projects are restructuring in Unter¬nehmen.
• Skilled labor shortages and lack of expertise of employees pose challenges to Unter¬nehmen in terms of speed and success of transformation projects.
• ESG and sustainability goals still play a comparatively minor role in IT transformation decision in companies.

Bielefeld/Walldorf – The SAP consultancy NTT DATA Business Solutions AG and the IT service provider Natuvion GmbH have jointly published the international “Transformation Study 2023”. The study provides detailed information about the motivation behind transformation projects in companies, the strategies and methods used, and the main challenges in the transformation process. More than 600 CIOs, managing directors and CEOs from high-end global SMEs were surveyed as part of the study in 2022. They are united by the fact that all of them have undergone a transformation of their IT system landscape within the last two years. The study makes it clear that both the willingness and the pressure of companies to transform are at a high level. Differences between the regions considered arise primarily with regard to the question of which goals are to be achieved with the digital IT transformation.

Almost every second decision-maker (46%) cites organizational adjustments or restructuring as the main reason for starting a transformation of their own IT infrastructure and processes last year. Other reasons include cost reduction (36%) and improved customer service (36%). More than every third person surveyed justifies the transformation decision taken with the aim of being able to offer innovative business models in the future.

“The study confirms our perception of the motivations for digital transformation,” says Norbert Rotter, CEO of NTT DATA Business Solutions AG and EVP of NTT DATA, Inc. “Despite a variety of challenges, companies worldwide see this step as necessary. In the long run, they will otherwise face higher costs, slower business decisions and an aging IT infrastructure. Our job is to help companies through this process and reduce complexity for them.”

An analysis of different regions shows a more differentiated picture. In the German-speaking DACH region, transformation decisions are most strongly linked to the desire to reduce costs (43%), followed by organizational adjustments and restructuring (39%) and the desire to improve customer service (37%). This weighting differs only slightly in the UK and the NORDIC region (Sweden, Denmark, Finland, Norway): cost reductions are named there in second place after organizational adjustments, followed by the desire to improve customer service.

A different picture emerges for the USA: although restructuring and organizational adjustments are also the most important motive for transformation decisions there (59%), unlike in Europe, American companies state significantly more frequently that they want to increase their innovative capability with the help of transformation. Every second American decision-maker expects to be able to offer more innovative business models after the transformation.

Challenges in digital transformation projects.

The study also analyzes which factors threaten the success of transformation projects. The decision-makers surveyed see the greatest challenge in the lack of expertise among their employees (39%) and the scarcity of resources (32%). A lack of expertise can lead to delays in planning and implementing the digital transformation. In contrast, according to the study results, time pressure for transformation projects is growing: In 2021, 40% of companies were still planning with a timeframe of between one and two years, and 25% with less than one year. In the following year 2022, it is now only 30 percent that plan with a timeframe of one to two years and 33 percent that want to implement the changeover within one year.

“We experience in many projects that companies underestimate the complexity of transformation¬ projects,” says Patrick Dahse, Managing Director of Natuvion GmbH, which has been a part of NTT DATA Business Solutions since August 2022. “That’s why good planning, high technical excellence and reliable migration management are relevant.” When asked what the managers surveyed would have done differently from today’s perspective, they responded that they would plan for more resources (46%) and time (38%) and start earlier (32%).

Sustainability goals are not yet key drivers

The transformation study delivers a surprising result when looking at the topics of ESG requirements and sustainability. This aspect is not yet a relevant reason for IT transformation in the eyes of the managers surveyed. Overall, only 14 percent of respondents cited this as a motivation for their decision. In contrast, the reassessment of short-term economic conditions is more important. The study also examined the question of what influence the new geopolitical and economic challenges had on the respondents’ decision to transform. Here, a differentiated picture emerges: Around one in five companies state that they have postponed (19%) or even canceled (18%) the transformation due to political and economic developments. On the other hand, 31 percent of the companies surveyed have even brought the transformation project forward and thus clearly prioritized it.

About NTT DATA Business Solutions.

NTT DATA Business Solutions drives innovation: from consulting and implementation to managed services and beyond, the consulting firm continuously enhances SAP solutions and technologies to make them work for businesses – and their employees. In doing so, NTT DATA Business Solutions draws on outstanding expertise in SAP solutions to connect its customers’ businesses with the latest technologies. As part of the NTT DATA Group, a global strategic partner of SAP and with close relationships with other partners, NTT DATA Business Solutions offers customers and prospects access to innovative solutions and developments, making an important contribution to innovation and long-term business success. NTT DATA Business Solutions employs more than 13,000 people in 30 countries.

About Natuvion.

Natuvion is a digital relocation company. Natuvion moves business critical data and processes from one technology platform to another! Natuvion experts are called upon whenever mid-sized and large companies want to modernize, optimize, separate, merge or transform their IT systems! This exclusive technical transformation expertise enables Natuvion customers to always leverage their data and processes on the most advanced and innovative technologies. As Inc. 5000 and FT 1000, Natuvion Group has been one of the most dynamically growing software and IT consulting companies in Europe for 4 years in a row.

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Further Links

Full Transformation Study