5 Reasons Digital Transformation Projects Fail


As we live in a digital world, staying at the top has become the top priority for every business, especially new startups. They compete against each other by becoming more effective and efficient through digital transformation.

Digital transformation is a buzzword that came into the limelight during the pandemic. For example, buying groceries online has become much more convenient than ever. Today, most buyers prefer to purchase items from the comfort of their homes.

The pandemic has urged business owners to rethink their business strategies. For example, B2B, healthcare, higher education, financial services, and public sector organizations offer online products and services to the customers. And these digital trends are not going anywhere soon.

What Is Digital Transformation?

Digital transformation allows business owners to gain a competitive edge in today’s fast-paced world.

Digital transformation strategies for businesses include:

Enhancing the customer’s experience
Embracing modern technologies
Streamlining the business operations
Improving business efficiency.

Today, every business aims to surpass its competition, but most fail. According to McKinsey & Company, more than 70% of businesses fail in their digital transformation efforts. Why? Most business owners fail to understand the concept of digital transformation; others do not have the right culture.

With that said, here we will discuss some of the top reasons behind digital transformation failure. So, let’s get started:

Top 5 Reasons Why Digital Transformation Fails

1. Failure To Understand The Concept Of Digital Transformation

First and foremost, 8 out of 10 business owners often relate digital transformation with digital marketing. For them, going digital means building a solid online presence.

While having an online presence is great, it doesn’t help a business improve the work culture and streamline the business operations. So, due to the lack of knowledge, business owners don’t understand its overall impact on the business and how it can help them earn more revenue.

This lack of knowledge often leads to ineffective business strategies that don’t contribute to the business’s scalability, flexibility, cultural transformation, etc. However, if you are the one – confusing digital transformation with digital marketing, then here is the solution:

Digital transformation refers to leveraging modern technologies into all business areas to streamline tasks and enhance the customer experience. It is wise to know that digital transformation is an organization-wide strategy that reinvents the new ways of doing day-to-day tasks, and it is an ongoing process.

2. Conflict Among Top Managers

Conflict among the senior-level executives and the top managers is common in the corporate world. Unfortunately, this conflict can act as a barrier and prevents businesses from going digital.

It is wise to know that the transformation starts at the top, and every C-level executive must be on the same page. So, what’s stopping them from being on the same page?

Most senior-level executives fail to understand the basic concepts of digital transformation and how it can help their business to grow. On the other hand, most of them hire the wrong talent for a particular job role.

However, to resolve this conflict, you need to communicate all the benefits of digital technologies and what they can bring to the table. You can convince your seniors by telling them an inspiring story of a company on how they have achieved their desired goals through digital transformation.

3. Lack Of Data = No Growth

Indeed, data plays a crucial role in every business, regardless of the industry. Business owners can make informed business decisions and learn about the customers to gain a competitive edge with the right data.

But if a business lacks data or has poor data analytics, all the digital efforts will get wasted. Why? Because when you have incorrect data about your business, how will you make the right business decisions?

However, the solution is to use the right technologies to gather, store, and analyze the data to get valuable insights and make business decisions accordingly.

4. Resistance To Change

Digital transformation strategies fail because of resistance to change. Employees are the backbone of successful organizations. What if your employees lack the skills required in today’s digital world? Your business is more likely to fall into shambles.

But it doesn’t mean firing all the existing employees or hiring the new talent. Instead, you can train your current employees about the latest technologies and bridge the skill gaps. You can boost the employee’s satisfaction and build a skilled workforce that can help you achieve your desired business goals. It’s a win-win situation.

5. Overlooking The Customer’s Needs

Today, delivering a top-notch customer experience should be a priority for every business. After all, customers appreciate when a business values them.

Therefore, before implementing the digital transformation strategies, you need to identify your customer’s needs. You need to welcome their feedback about how their experience with your brand was and what changes they wish to see in the future.

Identifying your customer’s needs is a must. After all, they are the ones who play a crucial role in a business’s sustainability.


Initially, when you implement the correct digital transformation practices, you may experience disruption in your business operations. But it is worth it for your business in the long run.

To sum it up, try to avoid the pitfalls mentioned above to streamline your business’s digital transformation journey.