How transformations fail
Transformation goals such as the adaptation and redesign of processes and the resulting business benefits can hardly be achieved without thorough preparation for the technical transformation. In an interview with E3, Natuvion CMO Philipp von der Brüggen discusses some of the expectations and challenges based on the transformation study by Natuvion and NTT Data Business Solutions.
Philipp von der Brüggen, CMO, Natuvion
E3 Magazine: The transformation study has been published for the third time. What is your most important finding over the years?
Philipp von der Brüggen, Natuvion: The results of the study are exciting throughout. However, there is one aspect that can be described as consistently striking over the years: Companies underestimate their transformation projects and only partially achieve the desired results. Given that a transformation requires enormous resources, it is tragic that many companies are unable to exploit their full potential.
E3 Magazine: What do companies expect from investing in a transformation?
Von der Brüggen: There are various reasons for a transformation. The favourite is organizational adjustment (restructuring) with around 36%. In second place is the introduction of new technologies (e.g. artificial intelligence) with 27%. This is followed by the introduction of new business models (26%) and increasing innovative capacity (26%). These are mainly business topics.
E3 Magazine: What are the striking regional differences in the global study?
Von der Brüggen: There are clear regional differences in the reasons for transformation. In DACH, first and second place are equivalent to the international results, namely organizational adaptation and the introduction of new technologies. Cost reduction is in sixth place across all countries, although in DACH it is in third place and almost on a par with the introduction of new, modern technologies in second place. In Northern European countries such as Sweden, Denmark, Finland and Norway, cost reduction is the second most common reason for transformation at around 26% and in the UK at 24%. The difference is even clearer when compared to the United States. Here, increasing the ability to innovate is in first place with 49%, closely followed by the purchase, sale or merger of companies or parts of companies. In the USA, on the other hand, cost reduction plays a far less important role.
E3: What do you conclude from this?
Von der Brüggen: When motivating a transformation, the focus is almost always on business benefits. In order to achieve this, management and those responsible for the transformation must understand that the challenges of the technical transformation must not be allowed to form a bottleneck and diminish the result. Companies should reflect on their situation in advance and make sufficient resources and budgets available for the project. We asked about the biggest challenges during planning in both 2023 and 2024. The complexity of the overall project was still in first place last year with 41 percent and in third place in 2024 with 34 percent. However, complexity was overtaken by employees' lack of or insufficient transformation expertise with an increase of 6 percent. The biggest surprise and challenge, however, is the scarcity of resources and employees' lack of experience with complex projects of this kind. This makes it clear that the necessary expertise must be built up early on for IT transformations - and this is where Natuvion's experts come into play.
Transformation study 2024
As part of a structured survey, Natuvion and NTT Data Business Solutions asked 1259 executives in 15 countries about their experiences from their last IT transformation. The granular survey pays attention to three main areas to help organizations better plan and execute their transformation based on best practices: What challenges in their transformation surprised respondents? What would they do differently today? Did they achieve their goals - and if not, why?
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