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Digital Transformation is opening new markets, creating new partnerships and alliances, and threatening almost all existing business and organizational relationships.

Awareness of digital transformation, an enthusiasm for what it can enable and a fear of its impacts now dominate C-Suite thinking. This means chief executives are looking to their CIOs to create platforms for change and innovation, though CIOs are being forced to do this while at the same time driving down the day-to-day costs of running the business.

The multiple drivers for digital transformation, the perceived challenges it brings and the impact of the need for radical change with tight budgets were all explored in a major Europe-wide research study by IDG Connect for global enterprise communications giant Level 3.

The most encouraging finding was that there is a determined effort by most organizations surveyed to swing digital investment towards innovation and transformation and away from spending on simply keeping the lights on – maintaining current applications and services. Some 96% of those surveyed were focusing on two or more areas of digital investment. The key priorities were:

  • Making use of big data analytics for improved business intelligence (61%)
  • Migration of applications and services to public, private and hybrid cloud (58%)
  • Implementing and maintaining effective data security systems (57%)
  • Upgrading or modernizing network platforms (55%)
  • Internet of Things and digital devices (54%)
  • Mobile device management to support BYOD (50%)

The results were generally consistent across countries, though UK and Dutch respondents put implementing and maintaining effective data security systems and policies as the number one investment focus (70%).

The primary challenges posed by digital, according to the respondents, are:

  • Keeping up with the pace of digital change (64%)
  • Finding the right partner to assist in digital transformation (63%)
  • Implementing effective data security for required system architecture (62%)
  • Segregating requires IT resources from day-to-day operations (58%)
  • Lack of in-house expertise in new technologies (58%)
  • Defining a clear road map (53%)

The data on the business factors driving digital transformation initiatives reveals the opportunities and potential dilemmas facing business technology leaders, who are trying to guide CEOs and line of business leaders towards digital.

The primary driver was to reduce the cost of IT service delivery by optimizing legacy systems (57%). This was followed by supporting product and service innovation (51%), improving customer experience and interaction (50%), and addressing company globalization requirements (47%).

Commenting on the results, Andrew Edison, senior vice president sales EMEA region at Level 3, said, “You have to be able to measure the benefit of every investment, but the value of digital is much more than old-fashioned measures of ROI. Digital transformation is not primarily about reducing the cost of IT service delivery, though cloud and an ever-growing range of As-A-Service options are driving down cost.

“Digital is about technology-driven transformation of your products, your services, your internal culture and your partnership and alliances, and your sourcing strategies. Perhaps most important, it is about redesigning your organization around the needs of your customers, and focusing your digital spending on delivering for them.”

For Andrew this means CIOs and business technology professionals have to create the platforms and deliver the infrastructure that can allow organizations to transform and grow securely and cost-effectively. We will be exploring these themes in future articles on the Level 3/IDG Connect study.

For more discussion on this subject and more information on Level 3 Communications, one of the world’s leading communications and services providers, follow this link

IDG Connect surveyed in executives, CIOs, CTOs, CDOs, CISOs, and managers in in organisations from 25,000+ to 500+ employees, with multiple offices