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Overcoming Digital Transformation Challenges

Published on 2 June 2021
Digital Transformation Challenges
Shubham Agrawal
Shubham Agrawal
Product Manager

Shubham Agrawal is a product manager at Applexus. He loves solving problems at the intersection of business, design & technology. With domain knowledge across retail, e-commerce & analytics, he believes that customers should be the forefront of a great product and the product should be on the leading edge of innovation. He holds an MBA from the Indian Institute of Management, Kashipur

Digital transformation is today's new reality, shaping how modern organizations function and navigate through unprecedented and ever-dynamic market conditions. As digital disruption continues to grab global attention, we find more and more enterprises joining the digital transformation bandwagon.
However, the path to digital transformation is not easy. There are numerous factors to consider before taking the plunge, and the complexities involved only increase the challenges of developing an effective strategy that facilitates this transformation.

What Are the Challenges?

Some of the challenges faced by organizations embarking on a digital transformation include:

Integrating Legacy with Emerging Technologies

One of the most significant challenges is incorporating legacy systems into sophisticated modern technology tools. Many enterprises have heavy investments in these legacy systems, making them reluctant to overhaul processes or undergo the cost, time and effort required to replace their existing systems.

But it is vital to understand that digital tools can connect legacy systems' functionalities and leverage them to drive greater business value. Ideally, project teams need to understand existing capabilities and enhance or build on them using the latest technologies. When legacy systems and business processes are successfully incorporated into a digital transformation, they can actually boost the value of the transformation, driving higher ROIs. Adopting cloud services is especially suitable as it enables seamless amalgamation of emerging technologies with the existing infrastructure.

Potential Risks

Risks tend to intensify with the introduction of sophisticated software, and complex organizational structures only add to these risks.
Completing a thorough risk analysis and mitigation plan are essential before launching a digital transformation project. As more and more business processes undergo digitization, it becomes easier to understand and control the risk profiles. For instance, digitalized advanced security systems can be used to protect both remote and local assets of an organization, data centers, and other entities.
Careful and repeated assessment of the digital transformation and potential risks is key to assessing the level of success. It can also help to expedite the transformation of critical processes and enhance their accuracy.

Culture of Complacency

Mindset and work culture are also big hurdles in successful adoption of a digital transformation. The ability to accept change is one of the most basic requirements for a company to evolve digitally. However, people's acceptance varies; while some may be dismayed about changes in how they used to work, others might be ready for it.

Overcoming reluctance requires extensive planning and focus, and leadership plays a vital role in this. Strong and visible executive endorsement and support for the transformation program can make adoption by the organization much easier. Leaders need to fully understand and clearly communicate the business benefits of digital transformation. The entire organization should understand and appreciate digital transformation for it to be successful. Cross-corporate partnerships can help facilitate this by motivating everyone to embrace digital innovations.

Complex Applications

As advancements in technology give birth to more sophisticated solutions, businesses are often forced to layer multiple applications to keep pace with innovation and continuously improve operations. Layering several digital tools can leads to confusion and navigation difficulties, leaving employees overwhelmed and hampering productivity.

However, a business cannot function without these systems. So it is important to find ways to simplify the experience with these business tools and streamline operations. Different digital business applications and platforms should be linked to promote a seamless and convenient user experience. Incorporating consistency between different digital applications across an organization is a key step forward in achieving better business outcomes. The cloud platform offers unlimited scalability and flexibility and is especially beneficial in managing corporate growth, regulatory and compliance requirements, and market adaptability.

How SAP Can Address These Challenges

A robust ERP solution can act as the central nervous system of an enterprise undergoing digital transformation. A key advantage of making SAP a strategic partner in this journey is the strength of the SAP ecosystem that can help facilitate and expedite the digital transformation journey.

For instance, after analyzing an organization’s existing technology portfolio to assess the level of digital readiness, SAP's ERP platform, S/4HANA, can provide significant simplification and consolidation. It is open, fast, and is delivered with advanced analytical capabilities. Additionally, SAP provides extensive support and a range of tools to address and overcome challenges.

SAP's software as a service (SaaS) facilities have empowered businesses to optimize their operational complexities and collaborate with other companies that offer infrastructure as a service (IaaS).

RISE with SAP

Recently, SAP launched its "RISE with SAP" initiative to enable organizations to accelerate their digital transformation journeys. The main objective of this program is to simplify the way SAP works with its customers, streamlining business innovations and digital transformation from the services and software procurement standpoints.

RISE with SAP is a unique offering that is being defined as business transformation as a service (BTaaS). It is a holistic offering of everything an enterprise needs to transform its business processes efficiently. RISE with SAP was designed to bridge gaps, extend support, and guide enterprises in overcoming the challenges faced during digital transformation. It includes business process intelligence tools, SAP S/4HANA Cloud, embedded services and tools, SAP Business Network Starter Pack, IaaS, and SAP Business Technology Platform (BTP).

Even if digital transformation initially seems difficult, with a reliable partner like SAP, overcoming obstacles to digital transformation will be easier.

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