Barriers to Digital Transformation – in the USA and Germany
Here are the results of an interesting 2017 study about Digital Transformation in corporations in the USA and Germany
Overall 294 decision makers within the area of digital transformation in large corperations were reviewed (135 in Germany, 159 in the US; etventure, 2017). Here are the major findings:
Digital transformation is clearly seen as priority (as top 3 topic by 66% of companies in the US, in Germany by 50%). 57% build a digital unit within the organization in the US, in Germany 33%.
As seen in those numbers, Germany has some catching up to do. This gets clearer considering that only 6% of the German organizations reviewed expect clear impacts through Digitalization within one year (US: 50%).
Why is that, and what are the barriers regarding Digital Transformation within the US and Germany?
A look at the employees shows, that generally employees share a positive mindset regarding Digital Transformation (US: 92%, Germany 64%). However, insecurities remain (USA: within 6% of the employees, Germany 37%). Considering, that in Germany only 42% of the staff is believed to be qualified for the transformation (USA: 90%), those numbers are not surprising. Given the positive mindset within the staff – why does change not happen faster?
Looking at the top inhibitors of Digital Transformation, we see differences between Germany and USA, which are for those with experience with German and American working culture, no surprise.
Both, in the USA and Germany, half of the reviewed organizations see a lack of time as a major barrier (top barrier in the US). As often, a lack of time is a bad excuse and usually rooted in a prioritization issue, and thus, probably a strategic matter.
The biggest barrier in Germany however, is a lack of experience in user focused proceedings (63%, USA: 14%). Many Americans, who experienced German customer orientation (outside of Lufthansa flights) will nod, knowingly… and so are the Germans who had the pleasure of restaurant visits and shopping trips in the US…
As usual, questions of organizational culture are of high relevance. For both, USA and Germany, the second biggest barrier is defending of existing structures. Followed, in the US, by being stuck in the old ways within their business area (Germany: 50%). Another main barrier is blocking security requirements (USA: 20%, Germany: 44%).
If you consider defensiveness, being stuck, the time excuse, and the lack of customer focus – large scale organizational change is in order, as often recommended.
Another insight, I believe this study allows us to deduct, is to direct our energy towards the leadership, given the mainly positive mindset the employees have. Agile companies need agile leaders.
Still a somewhat blurry picture of the Agile Leader remains, which some studies try to demystify, outlining a behavior based competency model as well as the personality aspects relevant (see articles in this blog to know more).