5 Main Reasons Why 70% of Digital Transformation Projects Failed

By Ranggi R.

Published on April 20, 2023

Since more organizations have paid more attention to the importance of digital transformation, they start implementing digitization and digitalization. 

However, there are only 30% successfully transformed and the rest failed. 

A failure story comes from the Target company. In 2013, Target expanded into Canada and planned to transform its operations using digital technology. Within two years, Target faced obstacles, including poor customer experience and supply chain issues. 

Another experience from a global leader in the mobile phone industry, Nokia. At that time, they resisted to adopt a new technology called touchscreens. As a result, Nokia could not compete with the other mobile phone manufacturers. 

So, Why do businesses fail when implementing digital solutions? 

Reasons Why Digital Transformation Fails

For those wondering why digital transformation can’t work in some companies, here’s why:

1) Resistance to Change

At first, employees may be shocked and resist the change. Even worse, resistance can lead to errors, failures, and inefficiencies when using new digital tools..

2) Lack of Training

Training is mandatory when organizations implement new digital technologies. If employees lack the skills, they may make mistakes, and potentially leading to a failure. 

3) Data Entry Mistakes

Human errors during data collection or data input can result in data defects. This reason may have some consequences, including wrong decisions, inaccurate customer experience, and others.

4) Cybersecurity Negligence 

Human error, such as not knowing enough, using weak passwords, or mishandling sensitive data, can lead to breaches or data leaks. Even worse, financial and reputational damage.

The Human Factors and Their Impact on Digitalization

Human is the key point of digital transformation. Humans can be successful factors, or the failure ones. 

On the other hand, organizations have an important role to embrace change and minimize the impact of human errors. 

To reduce mistakes, organizations should invest in training, change management, and communication, and enhance cybersecurity protocols.

Because the lower the security level, the higher the probability of failure.

How Human Error Leads to Digital Attacks

Here are three ways human errors can lead to digital attacks:

1) Using Weak Password

Human error stems from actions as basic as choosing passwords that are easy to guess or reusing the same passwords. This carelessness can lead to cyber criminals gaining access to systems or accounts, which means data breaches.

2) Phishing Attacks

Phishing is a dangerous way for people to trick others into providing personal information such as passwords, financial or customer data.

To steal information, cyber criminals first make victims click on malicious links from emails or websites.

3) Social Engineering

Cyber criminals attempt to pretend to be reliable individuals within organizations. Attackers try to adhere to confidential information after misleading people.

Although organizations cannot eliminate human error, they can at least try to minimize it.

Technologies’ Role to Help Human Errors

Dramatically, both humans and technology depend on one another. In addition to making humans learn technology, it should also make human labor easier. 

In conclusion, everyone who wants to transform must be able to keep up with technology.