The term digital transformation describes the journey undertaken by companies to implement new technologies that promote change and improve business processes. Examples of digital transformation technologies include AI, hybrid cloud, and big data analytics.
Digital transformation ranks among the top priorities for organizations in 2024. Yet, only around one-third of digital transformation initiatives are considered successful.
In this blog post, we’ll cover the latest statistics on digital transformation trends, top challenges, and spending data related to digital transformation.
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General Digital Transformation Statistics
61% of business executives recognize digital transformation as a top priority in their organizations (West Monroe)
Research indicates that 61% of C-suite executives believe digital transformation is a top priority in their organizations. Yet, only 21% of organizations state that the entire C-Suite holds responsibility for overseeing digital transformation initiatives.
94% of large organizations in the US and UK have a digital transformation strategy (Valtech)
A significant 94% of decision-makers at large organizations report that they have a digital transformation strategy. Only 5% of survey participants claim they have no digital transformation strategy.
81% of business leaders consider investments in digital transformation to be either essential or necessary for achieving business success (Valtech)
Research indicates that 81% of business leaders perceive investment in digital transformation as a critical or necessary element for achieving success in their organizations.
Digital transformation is a key technology initiative for 74% of organizations (Flexera)
Digital transformation ranks among the top 3 IT initiatives, closely behind cybersecurity (76%) and cloud (75%).
56% of US executives claim that ROI for digital transformation initiatives has exceeded their expectations (KPMG)
According to the majority of US respondents, the outcomes of investments in digital transformation have exceeded their expectations, in particular with boosting employee productivity, cost-cutting, and improving customer engagement.
58% of organizations aim to boost their spending on digital transformation initiatives this year compared to the year before (Valtech)
Over half (58%) of companies in the US and UK intend to increase their spending on digital transformation initiatives.
63% of executives worldwide have reported a performance increase from digital transformation initiatives over the past 2 years (KPMG)
According to surveyed executives worldwide, an average of 63% of respondents have reported a positive impact in terms of profitability or performance from digital transformation efforts over the past 24 months.
38% of executives globally report having the support of senior leaders for the deployment of emerging technologies (KPMG)
A recent survey indicates that 38% of executives worldwide report having buy-in from senior leaders for implementing new tools and technologies. That’s up from only 10% in 2022.
72% of CEOs claim they have an aggressive digital investment strategy (KPMG)
Digital investment is a key priority for CEOs, with 72 percent agreeing that they have developed an ambitious digital investment strategy.
89% of C-level executives claim their organization has pursued at least one large digital transformation initiative in the last 2 years (McKinsey)
According to a recent survey, 9 in 10 senior leaders reported that they had pursued digital transformation at their company in the past 2 years.
35% of organizations identify improving customer experience as a main goal of digital transformation plan (TEKsystems)
Improving customer experience, replacing legacy IT systems, and improving operational efficiency rank as the top 3 digital transformation goals in 2024 according to business decision-makers.
Here’s a complete list of leading digital transformation goals according to business leaders:
| Digital Transformation Goal | Share of Respondents |
|---|---|
| Improve customer experience and engagement | 35% |
| Replace or upgrade legacy IT systems | 34% |
| Reduce operational inefficiency | 31% |
| Enhance employee performance/productivity | 30% |
| Transform existing business processes | 29% |
| Increase/achieve innovation | 25% |
| Bolster cybersecurity | 25% |
| Gain competitive advantage | 24% |
| Improve employee experience | 18% |
| ncrease speed to market of existing products or services | 17% |
| Introduce new products or services | 17% |
| Introduce new business ******/revenue streams | 16% |
Digital Transformation Market Statistics
Spending on digital transformation is forecasted to hit $3.9 trillion by 2027 (IDC)
Digital transformation spending reached $2.5 trillion in 2024 and is set to reach $3.9 trillion by 2027. Forecasts indicate that the digital transformation market will achieve a five-year CAGR of 16.2% from 2022 to 2027.
US spending on digital transformation accounts for 35.8% of global spending (IDC)
The US and Western Europe accounted for over half (58.5%) of global digital transformation spending in 2023.
Here’s a detailed breakdown of digital transformation spending by region as of 2023:
| Region | Market Share |
|---|---|
| USA | 35.8% |
| Western Europe | 22.7% |
| China | 16.8% |
| Asia/Pacific (Excluding Japan and China) | 11.5% |
| Japan | 5.2% |
| Others | 8.0% |
Digital Transformation Challenges
Only about one-third of organizations meet their digital transformation objectives (BCG)
According to an analysis of over 850 companies worldwide, only 35% of businesses accomplished their objectives related to digital transformation.
Complexity of the current environment, gaps in technical talent, and high costs are leading digital transformation challenges (TEKsystems)
Recent research indicates that the complexity of the current environment (32%), lack of technical expertise (27%), and high costs are major digital transformation challenges in 2024 according to senior-level leaders.
Here’s a complete list of top digital transformation challenges:
| Digital Transformation Challenge | Share of Respondents |
|---|---|
| Complexity of current environment/siloed mindset and behaviors | 32% |
| Gaps in technical talent | 27% |
| High or unforeseen costs associated with digital transformation | 26% |
| Creation of a culture of continuous learning/workforce upskilling or reskilling | 25% |
| Change management and implementation complications | 24% |
| Economic uncertainty affecting budgets | 24% |
| Security concerns and compliance constraints | 23% |
| Operating-model transformation complications (current business processes are too rigid) | 22% |
| Lack of internal alignment (digital vs. traditional business) | 22% |
| Too many competing tech priorities | 21% |
| Alignment of digital transformation with business objectives/KPIs | 20% |
| Lack of strategy around digital initiatives | 20% |
| Lack of senior-level support | 13% |
Skills shortage, economic uncertainty, and regulatory implementation are among the top barriers to progressing with digital transformation initiatives (Veeam)
According to IT decision-makers, cyber threats (24%), ESG goals (24%), and skills shortage (22%) are among the top challenges preventing progress with digital transformation initiatives at organizations in 2024.
Here’s a complete list of the biggest challenges:
| Challenge | Share of Respondents |
|---|---|
| Cyber threads | 24% |
| Meeting environmental, social and governance goals | 24% |
| Skills shortage to implement technology | 22% |
| Economic uncertainty | 22% |
| Regulatory implementation | 20% |
| Organizational leadership is unsure/unsupportive of digital transformation | 20% |
| Industry disruption | 17% |
| Meeting changing customer needs | 17% |
| Geopolitical uncertainty | 14% |
| Resistant company culture | 14% |
Source link : Backlinko.com
