New global research has showed the majority of companies will increase their spending on digital transformation. The observation from a global IFS survey, highlights increased digital transformation investment aligns closely with concerns about economic conditions disrupting business – and that these respondents were 20% more likely to ramp-up spending on digital initiatives.
The study shows that today’s macro-economic disruption has failed to dampen digital transformation plans, with 52% of companies stating they will increase their spending on digital transformation, according to a global research study from the software developer.
While many people might assume that respondents concerned with the economy would pull back on technology spending, the reality is that investment is increasing. Appetite for digital transformation initiatives is, however, not consistent across all geographies or industry verticals, according to the research, but will certainly play a lead role in the recovery of the travel and tourism industries.
We are already seeing a robust recovery in domestic travel, hotel occupancy and rentals and search data suggests a strong pent up demand for international travel once barriers such as travel restrictions and border closures are removed.
Máire P Walsh, SVP digital technologies with Enterprise Ireland, and a knowledgeable voices in the travel tech sector, says there is evidence companies are looking to do things better and create a more compelling travel journey. “Well, the whiteboard is now clean and there’s an opportunity to do that. Crisis creates innovation and we’re definitely seeing green shoots starting to reappear,” she explains in an article promoting Ireland’s tech industry’s involvement in this area.
“Most airlines and hospitality brands are looking to innovate and there are a lot of Irish travel tech specialists creating solutions to satisfy that demand,” she explains, noting that we can expect a lot of innovation focusing on journey touchpoints aimed at making people safer and bringing back confidence. In terms of disruption most experts agreeing that what 9/11 did for travel security, Covid-19 will do for health and hygiene regulation.
CHART – The IFS research shows that digital transformation increases directly related to economic fearSource: Digital Transformation Investment in 2020 and Beyond: Factors in the Success or Failure of Technology Investments in the Post Pandemic Era
In the paper ‘Digital Transformation Investment in 2020 and Beyond: Factors in the Success or Failure of Technology Investments in the Post Pandemic Era’ based on its research IFS warns that despite the opportunity and a widespread willingness to invest, digital transformation execution remains a fraught area for many decision-makers with the ability to deliver a measurable return on tech investment quickly (and to the satisfaction of internal stakeholders) the number one concern for almost two thirds (64%) of decision-makers.
Regardless of the motivations for increasing spend on digital transformation projects, the grim reality is that, when IT programs fail, executive heads roll, notes the paper. That impact can be hard and long-lasting – just over a third (34%) of survey respondents said it took their business two to three years to recover from an IT project failure. A similar number (35%) took one to two years to make their recovery. “Under the weight of today’s macro-economic pressures, businesses simply don’t have that amount of time to waste,” warns IFS.
CHART – The impact of a failed digital transformation can be significant on a businessSource: Digital Transformation Investment in 2020 and Beyond: Factors in the Success or Failure of Technology Investments in the Post Pandemic Era
“Crisis is an exercise in change management. And the pandemic has forced many organisations to execute a lot of change, very quickly,” it explains, but for many the ability to transform with technology may prove to be a make or break move. And at a time when change and innovation are critical to business success, deriving value from technology investments is fraught with risk.