93% of Government Digital Transformation Efforts Fail, EY Survey Finds

Just seven percent of the 150 government leaders taking part in the  EY 2022 Tech Horizon Survey say their organization has achieved its digital transformation objectives, according to EY. That should not come as a surprise. 

Perhaps 70 percent of all digital transformation efforts, big information technology projects or efforts at change in general will fail. So failures in the public sector, which arguably has a harder time quantifying actual outcomes or controlling the inputs to drive change, is arguably at a disadvantage. 

At the level of technology, even if cloud computing, analytics, the internet of things and artificial intelligence are the tools used to create digital transformation, they generally are hard to apply in a government setting in a concrete fashion, especially if use of three or four at a time, in concert, is required to produce an outcome. 

source: EY 

Winter is Coming, Leaders are Getting Ready

KPMG’s Global CEO Outlook Report illustrates the principle that nothing in business or technology follows a straight line or a constant trajectory. And that seems especially true when the macro environment throws challenges. 

Executives who participated say that although they remain committed to “digital transformation,” they also expect to pause or reduce effort over the near term as they expect a recession to hit that will pressure their firms financially. 

source: KPMG

When leaders expect revenues to fall, attention always turns to the cost side of the business model. And even if leaders say they expect “digital transformation” (ignore the hype, just call it applied technology) to help on both revenue and cost sides of the business, the long-term goal will bend under the pressure of short-term financial stress. 

At this point, it would be a rare executive indeed--in the connectivity, software, applications or computing businesses--who is not preparing now for a recession in 2023. There could be a bright side. 

Periods of financial excess always lead to sloppy operations, thinking and execution. It can be argued that a decades-long period of zero cost of capital has led to some business decisions that will prove unwise as real costs of capital rise, and as a recession wrings weaker providers out of the market. 

Leader focus is about to shift to execution and fundamentals. Been there, done that.