UK BUSINESSES HARBOUR HIDDEN DIGITAL TRANSFORMATION ‘DEFICIT’

• Almost all UK firms are skipping key steps necessary to deliver successful major transformation programmes, according to new research from ArvatoConnect.
• ArvatoConnect provides customer experience and business optimisation services to global brands and organisations. 
• The findings show that the majority of firms don’t set key performance benchmarks, secure customer and employee buy-in or have a data strategy in place.
• Many organisations also admit their strategies are led by technology over customers’ needs, or are driven by an effort to keep pace with competitors. 
• ArvatoConnect says this is significantly elevating the risk of projects falling short of their potential or missing the mark completely.

Many UK businesses are missing the key steps necessary to achieve their digital transformation objectives, a new report reveals – creating the risk that major projects and initiatives will fail to fully deliver their intended benefits.

More than two thirds (68%) of firms currently delivering digital transformation projects don’t have an overarching data strategy in place, while 70% say they don’t have the infrastructure to effectively collate and manage information and 72% aren’t confident they can protect it once they have it.

The research, published by ArvatoConnect – formerly Arvato CRM Solutions – and which surveyed* 500 customer experience, IT and transformation decisionmakers in UK companies, also found that four in five (81%) don’t gather feedback from customers on how their existing solutions are working and haven’t trained employees on new technologies or processes (84%).

Similar proportions admitted to not seeking customer (81%) or employee (82%) buy-in on their transformation plans, or even setting key performance indicators (KPIs) (80%).

ArvatoConnect, which provides customer experience and business optimisation services to global brands, says that businesses are misplacing their confidence and that skipping these important steps is creating a ‘digital deficit’ – a disconnect between transformation plans’ objectives, and the reality of what they are likely to achieve.

James Towner, Chief Growth Officer, ArvatoConnect, said: “While our research tells us that many businesses are confident in delivering successful digital transformation projects and have such projects underway, this confidence may be misplaced.

“Transformation holds the key to future growth and productivity gains for businesses across the UK’s economy, but the programmes that are missing steps like gathering customer feedback and even setting KPIs is concerning.

“These steps constitute key foundations of successful digital transformation projects, and firms must take this into account and focus on closing these ‘digital deficits’.”

ArvatoConnect’s report also uncovered that many companies’ transformation strategies were being driven by technology or competitive impulse, rather than by businesses’ or customers’ needs.

More than three quarters (77%) of decisionmakers admitted that their transformation strategies were being led more by available digital solutions than what their customers or businesses actually require. Meanwhile, nearly two fifths (39%) said their plans were being shaped by simply trying to keep pace with competitors.

This type of transformation approach could mean that common customer experience problems are left unaddressed. A separate YouGov poll of UK adults**, commissioned by ArvatoConnect, found that more than two thirds (68%) had experienced an issue contacting a company in the last 12 months, while nearly half (47%) had experienced an issue when contacting a government body.

James Towner continued: “Any transformation programme needs to be grounded in a clear understanding of the needs of the organisation, its customers or its citizens.

“Organisations mustn’t fall into the trap of spending time and money on developing solutions that are then left looking for a problem to ‘fix’.

“Taking the time to get the basics right – and seeking the right support with digital transformation planning – will only generate better results over the long term.”

The Digital Deficit report is the first launched by ArvatoConnect, formerly Arvato CRM Solutions.

The business is a trusted partner to leading global brands, including a major high street retailer and natural health and footwear brand VIVOBAREFOOT.

The new brand – launched in February 2024 – reflects the expansion of the business’ proposition to incorporate both customer experience and business optimisation services, underpinned by innovative, technology-led solutions.

To read the complete Digital Deficit report, click here: www.arvatoconnect.co.uk/arvatotalks/uncovering-the-uks-digital-deficit