In the Middle East, 54% said their organisation’s investment in DX projects in the last 12 months had been wasted.
Endava commissioned IDC InfoBrief – Leveraging the Human Advantage for Business Transformation – uncovers the roadblocks, tactics and outcomes of digital transformation (DX) efforts in the last year, as well as strategic drivers and approaches to integrating major technologies shaping the landscape, such as AI and automation.
The impact of DX failure
The research, which surveyed business leaders and decision-makers across the globe, including the Middle East, revealed that the overwhelming majority (88%) said that only 50% or less of their DX projects in the past year met the expected goals or outcomes. And in the Middle East specifically, a slight majority (54%) of respondents felt their organisations’ investments in digital transformation projects has been wasted. When businesses miss the mark on DX projects, it isn’t just cost implications they face. While 62% of global respondents reported failure resulting in them being less technically mature than competitors and having a longer time to market, key challenges damaging the employee experiences 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 (43%).
David Boast, General Manager – MENA, Endava said: “At a point when businesses are under immense pressure to maximise the ROI on every dollar spent, the fact that half of Middle East organisations believe their DX investments have been wasted is especially concerning.“
Why DX fails
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%).
AI and automation on the rise
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 for Middle East organisations, with over half (56%) of the 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, as globally, almost half (49%) declared it as very or extremely important.
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. It is worth noting however that while Middle East businesses recognise the value that AI and automation yield, the majority (54%) foresee that these technologies will have a high impact on their reskilling needs.
Despite obvious challenges, 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 projects is inherently reliant on understanding how people can be empowered by technologies, and this research reinforces the fact that nurturing meaningful results demands a human-centric approach throughout every stage of digital evolution. In practice, this means understanding people’s needs and expectations, working through cultural barriers to adoption and collaborating with employees across the organisation to build engagement from the outset.”
Offering insight on the Middle East finding of the study, David Boast, General Manager – MENA, Endava said: “At a point when businesses are under immense pressure to maximise the ROI on every dollar spent, the fact that half of Middle East organisations believe their DX investments have been wasted is especially concerning. In addition to sunk costs, there is also the loss of business value that could have been achieved had these projects delivered on their intended outcomes. Moving forward, regional enterprises would be well advised to forgo complex, multi-year projects in favour of an iterative approach to tech innovation that is human-centric, constant, and scalable.”
