Just 6% of Canadian businesses are Digital Leaders, according to the DT Index. The DT Index, which was completed in collaboration with Intel, maps digital transformation progress of mid to large-sized companies and examines the digital hopes and fears of business leaders. While Canadian businesses have a ways to go before the majority are Digital Leaders, they are hopeful that they can get there with the study revealing that 31% of them believe they’ll disrupt rather than be disrupted.
The DT Index’s calculations are based on companies’ perceived performance in the following areas: delivering against the core attributes of a digital business**, their existing IT strategy, workforce transformation strategy and planned investments.
Two years after the DT Index’s initial launch in 2016, Dell Technologies and Intel have more than doubled the scope of the research, from 16 countries to 42 and benchmarked 4,600 businesses using the below groupings. Here’s how Canada ranks this year compared to 2016:
| Benchmark Groups | Description | 2018 | 2016 |
|---|---|---|---|
| Digital Leaders | Digital transformation, in its various forms, is ingrained in the DNA of the business | 6% | 3% |
| Digital Adopters | Have a mature digital plan, investments and innovations in place | 29% | 12% |
| Digital Evaluators | Cautiously and gradually embracing digital transformation; planning and investing for the future | 22% | 24% |
| Digital Followers | Very few digital investments; tentatively starting to plan for the future | 34% | 44% |
| Digital Laggards | Do not have a digital plan, limited initiatives and investments in place | 9% | 18% |
While there is minimal growth in the Digital Leaders group, the Digital Transformation Index has tracked dynamic movement across other groups. For instance, 29% of businesses now are categorized as Digital Adopters (up 17% from 2016). These companies have advanced digital plans and innovations in place to power their transformation.
However, the Digital Transformation Index also reveals that too many Canadian companies are still coasting in the middle group or stuck in the bottom two groups meaning they’re either moving too slowly or don’t even have a digital plan in place.
Barriers to digital transformation
According to the research, 89% of Canadian businesses are facing major impediments to digital transformation today.
The top five barriers to digital transformation are:
- Lack of budget and resources
- Data privacy and cybersecurity concerns
- Information overload
- Lack of the right in-house skill sets and expertise
- Lack of the right technologies to work at the speed of business
These barriers are hampering digital transformation efforts. Regardless, there is a sense of urgency among business leaders and right now 83% of them believe that digital transformation should be more widespread throughout the organization. This figure has jumped 15% since 2016.
“We’ve talked about being on the cusp of tremendous change for some time now. That’s no longer the case,” said Kevin Connolly, President of Commercial Sales at Dell EMC Canada. “The next digital era has arrived and it’s reshaping the way we live, work and conduct business. Canadian businesses are getting there but still have quite a ways to go if they want to meet the changing demands of customers.”
Conquering their challenges
The research indicates that businesses are taking steps to overcome their barriers and combat the threat of being outmaneuvered from more nimble, innovative players. Progress is definitively being made and the below statistics explain the spike in Digital Adopters this year:
- 28% of Canadian businesses have embraced agile software development allowing them to code and securely launch new applications within much shorter cycles (up 6% from 2016).
- 50% are building security and privacy into all devices, applications and algorithms, up from 45% in 2016.
- More companies are taking action to resolve the workforce skills gap by developing the right skills sets and expertise in-house, such as teaching staff how to code (42%; up 18% from 2016).
- 45% of businesses are sharing knowledge across functions, by equipping IT leaders with business skills and business leaders with IT skills (up 25% from two years ago).
Investments in initiatives which enable digital transformation to occur is also up and is expected to continue rising. Below are the top five planned investments in the next one to three years, as indicated by Canadian business leaders:
- Cybersecurity
- Multi-cloud environment
- Artificial Intelligence
- Internet of Things technology
- A compute-centric approach to data centre design and workload enablement/optimization
“It’s an exciting time to be in business, especially in Canada. We’re at a crucial intersection – where technology, business and mankind meet to create a better, more connected world,” said Mike Sharun, President of Enterprise Sales at Dell EMC Canada. “However, only technology-centered organizations will reap the rewards offered by a digital business model, including the ability to move quickly, to automate everything and to delight customers. This is why digital transformation needs to be a number one priority for Canadian businesses and why Dell EMC Canada is their best solution.”
