Majority of companies face digital deadlock

Leading IT market research and advisory firm, IDC, conducted the survey of 400 digital leaders in Europe across France, Germany, the Netherlands, Sweden and the UK, in 2018, sponsored by Workday. It focused on where the IDC-termed ‘digital deadlock’ was related to finance and HR systems, and the impact of DX on core business systems as organisations move beyond DX experiments and pilots to try and operationalise their DX strategy and embed it within the business.

The digital leaders surveyed identified the following three critical pain points, with digital leaders in the UK admitting that in their organisations:

• 86% cannot integrate new digital solutions with existing finance and HR processes, or require effort to do so

• 82% require effort or cannot get real-time forecasts and dashboards

• 80% find it difficult or impossible to adapt finance and HR processes to the new requirements

Other key research findings included:

• 57% of European Digital Leaders believe that the modernisation of core business systems is needed to support the success of the overall DX strategy for their company

• Just 19% and 10% of respondents see their finance and HR systems respectively as ‘state-of-the-art’

  • 40% view these systems as ‘reasonably modern’

  • 37% (finance) and 43% (HR) view these systems as ‘adequate’

• When asked to identify the critical requirements of core business systems to support DX strategy, respondents cited the following top five needs:

  • 46% cited security and auditability as of critical importance in finance and HR systems

  • 37% saw a simple and intuitive end-user experience as one of the most important requirements

  • 34% believe continuous planning and forecasting is of high importance

  • 31% want to see configurable, self-service reporting in the core business systems

  • 29% desire actionable insights into finance and people data around digital transformation projects

As part of the white paper, IDC studied a number of companies deemed ‘best-in-class’ in digital transformation in Europe. IDC suggested three areas for finance, HR and IT to work alongside digital leaders to help ensure this potential ‘digital disconnect’ does not materialise in the long run:

• Creating a digital dream team to cut across finance, IT, HR and the broader business:

73% of best-in-class digital leaders are actively engaged in discussions with the head of HR and finance regarding digital transformation

• Supporting new business models through finance and HR:

76% viewed this as very or extremely important. There is an understanding that to do this the ability to reconfigure finance and HR systems in a dynamic fashion is critical.

• Modernising finance and HR:

Best-in-class organisations are making significant investments in finance and HR systems. In fact, 88% of these organisations are investing in advanced finance, and 86% in advanced HR systems, to support the digital transformation journey

Comments on the news

“Through the research we have identified three areas of best practice that can drive successful digital transformation, with DX placing new and challenging requirements on finance and HR,” said Alexandros Stratis, co-author and senior research analyst, IDC. “Firstly, the importance of a digital ‘dream team’ that cuts across finance, IT, HR and the broader business; secondly, the need to be able to dynamically reconfigure finance and HR systems; and thirdly, that best-in-class organisations who are leading the way are already making significant investments to modernise their finance and HR systems.”

“The time to disrupt is now,” said Carolyn Horne, regional vice president of UK, Ireland and South Africa, Workday. “DX strategies are being rolled out by organisations as forward-thinking CEOs realise digital transformation across the business is critical if they are to survive and thrive. Technology is playing a critical role in this change, but this change is not just about how a company innovates around new products and services, or changes the customer experience, the whole organisation needs to adapt and modernise. This must include finance and HR, otherwise the agility, flexibility and insights needed to be successful in the modern business world cannot be achieved.”