Embracing IT transformation has become the new normal

A new survey commissioned by Dell EMC finds that while objectively, as many organizations are laggards on the road to digital transformations as there are front runners, the vast majority now believe that this transformation is necessary for their organization’s health.

Michael Sharun, President of the Dell EMC Canada Enterprise Division

Dell EMC has announced the first stage of the results of new research it commissioned from the Enterprise Strategy Group [ESG] into the benefits of IT Transformation. It found that support for the concept of such transformation is now extremely strong. Even organizations which, objectively, are below average in progressing on their own journey, still believe in the journey’s importance. The announcement was the first stage of the study, with later research broken down by country coming out at Dell Technologies World in three weeks.

“In terms of IT transformation, the survey show that it doesn’t matter what business you are in, because IT is now part of the business, not separate backroom processing,” said Michael Sharun, President of the Dell EMC Canada Enterprise Division. “It shows acceptance of the idea that IT is rudimentary to success of any organization. That part is exciting and it really comes out in the study.”

The survey of 4,000 organizations found that 81 per cent of survey respondents agree if they do not embrace IT Transformation, their organization will no longer be competitive in their markets. That’s up from 71 per cent in the same survey that ESG prepared on behalf of Dell last year.

“An additional 10 per cent believe that if they don’t do this, they will not be competitive in the future,” Sharun said. “That’s significant. They know they need to do something.”

ESG classified only 6 per cent of organizations in Stage 4 –  Transformed  — the furthest along in IT transformation. That’s up only a point from last year. However, that 6 per cent was 22x as likely to be ahead of the competition with new products and services to market. Transformed organizations believe their company is 2.5x more likely to compete in its market over the next few years. They also are 18x more likely to make better and faster data-driven decisions than their competition and are 2x as likely to exceed their revenue goals.

At the other end of the scale, only 6 per cent fell into Stage 1 – Legacy – where they fell short on many, if not all of the dimensions of IT Transformation. That’s down from 12 per cent in last year’s survey. 96 per cent this year said that they have Digital Transformation initiatives underway, indicating that a third of the Legacy companies have actually started the process, but have just not gotten very far.

The other two groups were  Stage 2 – Emerging – and Stage 3 – Evolving. Emerging, which  showed progress in IT Transformation but had minimal deployment of modern data centre technologies was at  45 per cent, up from 42 per cent last year. Evolving rose from 41 to 43 per cent. These were defined as showing commitment to IT Transformation and having a moderate deployment of modern data centre technologies and IT delivery methods.

“In the past, support for digital transformation has been more about cost containment,” Sharun said. “This year, it’s more about growing revenue. The consensus is that you need a clean and agile IT environment.”

Last year’s survey had no specific Canadian content, although Sharun thought that the findings were also representative of Canada. This year, the study DOES have Canadian data, even though it will be a few weeks before we see it. Sharun hasn’t seen it either, but based on his reading of the environment here, he thinks Canada will do well.

“I’ll go out on a limb and, think we will be ahead,” he said. “Canada has been an early adopter in the converged arena, which is much less expensive to operate and manage. I think that the news now is overweighting examples of what Canadian companies are doing to transform their businesses, which encourages others to do so.”

So whats the takeaway for this for Dell EMC and its partners?

“It shows my team here that we need to be talking to customers not only about how they manage their IT environments, but that we also need to talk to business leaders about their desire to do things faster and quicker,” Sharun said. “We need to talk to both to be successful.”

Sharun said that they also need to emphasize efficiency, not just cost savings.

“It’s not just about reducing expenditures,” he said. “It’s getting things done quicker. The data this year showed that Transformed Organizations complete 3x more IT projects ahead of schedule and deploy 10x more applications ahead of schedule. Those numbers are huge for Canada, because we are constrained on resources. Being able to get things done quicker is key to our global competitiveness.”

For the channel specifically, the data should encourage them to think in terms of more comprehensive solutions, Sharun said.

“Why would you want to sell a point solution to a customer, when they need a solution that covers both business and IT across the operation,” he stated. “The customer wants to do it simpler, and to deal with one vendor and one partner to get this done. That’s great news for the channel organization. We can’t do this without them. We provide a lot of the building blocks, but they are the glue. It’s a different world than they have had in the past, but they are more important than ever.”