How cloud strategy can be the silver lining to data centricity

According to the survey, 20% of Irish respondents say they have completed or achieved the transformation’s objectives, and while that is more favourable than the global number of 13%, it does highlight that digital transformation is a challenging undertaking. This is backed by the statistic that 32% of Irish respondents (vs 34% globally) say their digital transformation is falling short of expectations.

The research highlights four key enablers that distinguish organisations that are succeeding in becoming data centric: building a vision from the top for a data centric future; focussing on use cases aligned to the overall business strategy; building the technology foundations; and focussing on customers to the point of obsession.

Data and analytics form the core – with 46% of Irish respondents saying they expect data and analytics to deliver the most value (compared to other technologies) for the organisation in the next two years.

When it comes to investment, 38% Irish respondents said data and analytics are most likely to account for the largest share over the next two years, compared to the 53% global peers who said the same. When compared against cloud investment, 52% of Irish respondents indicated this would be the largest area of investment versus 49% globally. When ranked, cloud is the number one investment for Ireland versus number two for global respondents.

"Irish respondents clearly recognise the potential value of data and analytics but placed cloud investments ahead of them for investment. This suggests that they are focussed on building the technology foundations and accelerating their migration to the cloud as an enabler of data centricity. The availability of powerful data analytics tools on a software as a service basis on the cloud may be another reason for the higher priority placed on cloud investment,” explains John Ward.
 

Data centricity will drive and predict the most important decisions, processes, and interactions of the future enterprise. 52% of Irish respondents said difficulty in tracking customer needs or lack of data/technology to track those needs is the most significant challenge to improving customer centricity in the organisation.

Irish respondents say the number one barrier is leadership styles that rely on intuition (30%). Uncertainty at leadership level on how data can create value for the organisations was also pointed to as one of the main barriers (26%). Other key blockers were finding and combining data from different platforms (28%) and budget limitations (28%).

“There is evidence of a lack of buy-in amongst the leadership of Irish organisations when it comes to becoming more data driven. This, in turn, will translate into a lack of support for data initiatives and the budget limitations highlighted by respondents. This should be a cause for concern as data driven organisations will enjoy a competitive advantage when it comes to operational efficiency and the ability to serve customers’ changing needs,” Eoin O’Reilly elaborates.

It is interesting to note that in this respect, Ireland deviates from averages for the rest of the world. For global respondents, the top challenges to being more data driven are difficulty scaling data-driven products/services (29%) and employee skill gaps in data and analytics (29%), followed by concerns around data sharing, privacy, ethics and consumer trust (25%).

Interestingly, those challenges are all associated with data already being in widespread use in an organisation. This suggests that Irish companies are lagging behind their global counterparts in that respect.

The top reasons Irish companies give for pursuing transformation relate to meeting changing customer demands and reducing costs (both at 36%). Given data is central to both, there are bound to be frustrations if there is a failure on the part of leadership to back data initiatives. When asked what prevents their organisations from being more customer centric, the top answer wasn’t data based, it was people based. Once again leadership emerges as a key issue with 44% saying a lack of consensus at the top level on how to improve the customer or citizen experience is their number one challenge.

Tech-enabled transformation is being delayed by complexities related to integrating systems and ecosystems. Connecting or integrating multiple systems is cited as the top challenge for 36% of Irish companies, followed by complexities relating to establishing and managing corporate partnerships and ecosystems (34%). Skills shortages and the high cost of infrastructure are also key challenges.

This lack of integration plays out in organisational culture as well. 32% of respondents cited ineffective cultural collaboration and corporate culture differences across geographies (28%) and ineffective virtual collaboration as among the most significant culture challenges during transformation. The top cultural challenge encountered during transformations is siloed functions, with 40% of Irish respondents experiencing difficulties with organisational siloes that don’t support organisation-wide collaboration. Interestingly, this was only an issue for 22% of global organisations.

“This finding suggests that Irish organisations are still working in very siloed and traditional ways. This is quite surprising as it is not our experience here in EY. It might reflect the far higher proportion of privately owned companies (56%) involved in the Irish survey than in the global study (30%). Nevertheless, there is a need for a greater appreciation for the whole of organisation response required for organisations to become truly customer and data centric. It is not just a technology issue. Strong collaboration is required for data and analytics to work,” explains John Ward.

Pace of change was also identified as a significant issue with 36% of Irish respondents saying the culture is failing to evolve in line with customers, technology and the transformation itself.

The majority of enterprises are still working on developing a transformation culture, with 80% of Irish respondents agreeing this is a work in progress.

Competition for talent continues to put pressure on organisations and a key issue highlighted by respondents is a deficit in the skills to connect the different data silos that tend to exist within organisations. To address talent gaps, 70% say they are focussing on re-skilling rather than hiring to acquire technology-related skills. This may be to reduce time requirements to onboard and align employees with the corporate vision.

Developing the right internal talent for transformation is proving to be no easy task, however. The most significant internal barrier to getting the skills needed for transformation is ineffective upskilling programmes. 54% respondents cite difficulties related to retaining existing skilled talent or ineffective programmes to upskill existing employees as the biggest internal barriers for obtaining skills.

This is further complicated by the Great Resignation, which has made talent acquisition more difficult: 76% of respondents agree that competition for workers with technology-related skills has increased because of the COVID-19 pandemic. And when it comes to attracting experienced talent, inadequate compensation and incentives and insufficient flexibility in work policies (i.e., limited remote working and fixed hours) are seen as top barriers.