Eugenio Marongiu - Fotolia
Small and medium-sized businesses across the board have either recently launched or are in the process of launching digital transformation initiatives, but many are running up against obstacles.
The results of the inaugural Insight 2020 Technology Report: IT Trends for Midmarket and Small Business, a study based on input from more than 400 North American IT professionals at independent and emerging businesses, highlighted that dilemma. Insight Enterprises conducted the research.
Technology has become a corporate cornerstone, even for small businesses, according to the report. "Enterprises recognize that they need to embrace leading-edge technology in order to remain competitive," said Joseph Clinton, central region sales director at Insight Enterprises.
Organizations expect that embracing digital transformation will positively impact their operations, the report said. The top three business areas that respondents said digital transformation initiatives would help improve are customer experience, cited by 43%; operational efficiency, 42%; and workforce productivity and collaboration, 42%.
Digital transformation challenges
Realizing the potential benefits of digital transformation has been vexing, however. Close to half of the study's respondents, 49%, said integrating new technology with legacy systems is very or extremely challenging when dealing with IT service providers. "Many companies perform a lift and shift. They simply take their existing applications and port them to the cloud," Clinton explained. "In those cases, they do not take advantage of any of the modernization features available in the new environment."
Funding is also a challenge for digital transformation initiatives. The study found that 44% of respondents pointed to budget constraints as an inhibitor to embracing digital transformation.
Additionally, when attempting to equip their businesses with the latest technology, 45% of SMBs said understanding which new technologies to invest in is an area of concern. Many new systems are cloud-based, and cost is a key obstacle here, as well. Comparing cloud pricing to current expenditures is the most frequently cited barrier to migration, cited by 56% of SMB respondents.
Building a digital transformation framework
So, how can a company address its digital transformation challenges? "Businesses need a framework, a plan that aligns where they are today to where they want to be in the future," Clinton said.
Joseph ClintonCentral region sales director, Insight Enterprises
But in many cases, these organizations lack the technical depth to create the plan -- a task that channel partners can help with. "There are a lot of potential pitfalls," Clinton said. "Businesses need to get their applications and employees ready for the change. The bursting that cloud offers can be helpful, but it can also be expensive. In some cases, modern applications cost much more than legacy systems."
As a result, corporations should not automatically assume the cloud offers them a better deployment model than legacy infrastructure. They need to create a methodology to see which workloads should move. Channel partners with deep cloud experience are in prime position to help them make the right call, Clinton said.