According to a recent report by Accenture’s local arm, a significant proportion of Australia’s indigenous companies are finding it challenging to keep pace with the rapid global shift towards digital adoption and transformation.
The consulting agency found that 40% of native corporations lagged behind, ranking in the bottom quarter compared to global competitors in North America, Europe, and Asia, based on digital maturity levels.
According to Matt Coates, know-how lead at Accenture Australia and New Zealand,
- Companies founded by indigenous peoples may need to consider investing in forward-thinking innovations rather than simply maintaining existing practices to stay competitive?
- Corporations must strike a judicious balance in managing technical debt, with Accenture recommending that clients allocate 15% of their IT budgets towards debt remediation efforts.
Companies were primarily measured by their ability to integrate a “digital core” – a term coined by Accenture to describe the cloud infrastructure, digital platforms, data architecture, and security foundation that enable organisations to innovate and evolve.
Australian corporations still lag behind their global peers in terms of digital maturity?
According to Accenture’s recent report, the global corporation’s digital maturity levels have been assessed and ranked. According to a survey of 50 Australian organizations, a staggering 40% were found to be lagging behind, ranking in the lowest quarter globally – an alarming indicator that Australia harbors more than its share of underperforming companies.
Compared to the rest of the world, Australia’s major companies stood out in a positive light: an impressive 24% of domestic firms were ranked among the global top 25%. Approximately 36% of organizations have achieved a digital maturity level situated at or near the global average, with nearly three-quarters of respondents clustering in the top two quartiles.
“While acknowledging that varying levels of digital capability exist across Australian organisations, we’ve been aware of this disparity for some time,” Coates noted. While acknowledging that top-tier Australian organizations appear to be keeping pace with their global peers, there is likely a significant decline in performance among those further down the list.
Strategic opportunities for growth, unrealized revenue potential.
Australian organizations lagging behind in digital transformation may be missing out on crucial enterprise benefits. Corporations possessing a convoluted digital infrastructure possess skills.
- 20% greater income progress charges.
- 30% greater profitability globally.
According to Accenture’s findings, when combined with strategic innovation investments and a thoughtful approach to technical debt, this initiative yields a 60% increase in income growth fees and a 40% boost in income.
Corporations are being held back by outdated operational systems, lack of innovation in core processes, and inefficient supply chains.
Accenture has identified several factors contributing to Australian organizations trailing their global peers in terms of digital adoption.
A ‘short-term’ mindset
Despite Accenture’s findings, some enterprise leaders still misconstrue digital transformation as a valuable goal rather than a key growth driver. However, despite awareness of the contrary, a shortsighted perspective persists, ultimately resulting in inadequate investment in knowledge acquisition.
Can prioritizing tech debt over innovation stifle long-term growth?
Numerous organizations are grappling with technical debt in a manner that hinders their ability to drive innovation. According to Coates, managing technical debt remains a significant challenge, as numerous organizations struggle to strike a balance between addressing existing debt and investing in innovative initiatives that drive future growth.
What’s driving the cultural resistance to embracing digital and alternative forms of communication?
Despite being ardent champions of digital transformation among Australian CIOs and CTOs, lingering cultural resistance can still thwart their efforts to drive widespread adoption and maturity. Despite senior leaders’ efforts to share knowledge, Coates revealed that organisational adoption can still be hindered by challenges.
Expertise challenges embrace human issue
Despite widespread adoption of digital platforms by ANZ executives, Accenture’s study reveals a concerning trend: a staggering 61% of respondents admit that these tools are often underutilized within their organizations, failing to deliver the expected benefits. However, a significant 41% of respondents acknowledged that incorporating emerging technologies poses a tangible challenge.
Coates suggests that organisational culture and employee buy-in are key drivers of digital adoption, rather than relying solely on technological advancements.
He noted that without incorporating effective change management and skill-enhancing programs into the technology strategy, organizations may experience various challenges.
Hybrid cloud, information governance, and cybersecurity threats are major organizational hurdles.
Organisations with indigenous roots face significant challenges in adopting advanced scientific disciplines, which include:
Accenture identifies partial cloud migrations as a critical concern. “Cloud transformations often stagnate due to the intricacies of hybrid environments and outdated methodologies,” Coates noted.
Australian companies face significant hurdles in ensuring the integrity of their data and robust governance, a crucial factor in facilitating efficient decision-making and embracing innovative technologies such as generative artificial intelligence.
As threats escalate, organizations must fortify their safety frameworks and compliance protocols to effectively mitigate risk and ensure regulatory conformity.
To accelerate organisational growth, it’s crucial to cultivate a robust digital core that integrates seamlessly across functions.
Companies looking to build a top-performing digital core should consider the following strategies outlined by Coates:
What can a robust digital core bring to your organization? By integrating cutting-edge technologies and leveraging data-driven insights, this transformative hub empowers businesses to drive innovation, boost efficiency, and foster growth. As the heart of your digital transformation journey, it unlocks opportunities for: seamless collaboration, streamlined processes, and enhanced customer experiences – all while ensuring a secure and scalable foundation for future success.
Educating stakeholders is a crucial aspect of the digital transformation journey. Accenture urges Australian IT leaders to prioritise upskilling their entire organisations on the vital importance of a robust digital backbone. The company’s focus on innovation extends beyond its technology department.
Coates famously stated that “Expertise is at the core of every enterprise today, with the potential of AI ensuring its continued relevance.”
“As leaders realize the critical role digitalization plays in fueling innovation and maintaining competitiveness, they are more likely to commit the necessary resources to drive strategic digital transformation initiatives.”
Ensure adequate technology investments in transformative initiatives for sustained growth.
Companies should consider allocating a larger portion of their IT budgets to driving strategic innovation rather than simply maintaining existing systems. According to Accenture’s global analysis, companies within the main quartile consistently increase their IT budgets by a minimum of 6% annually, allocating resources for strategic innovation.
While acknowledging the importance of investing in innovation, Coates emphasizes the need to balance this pursuit with the pressing requirement to manage technical debt effectively.
“We recommend that approximately 15 percent of IT budgets be allocated towards debt remediation, ensuring the maintenance of core IT capabilities while investing in future development,” he said.
What happens when technology becomes the ultimate driving force of societal evolution?
Lastly, Coates posited that a profound cultural metamorphosis is imperative, necessitating a sustained commitment to self-reinvention and adaptability.
- Creating digital expertise.
- Encouraging innovation.
- Creating a culture that encourages adaptability to transformation.
As he clarified, by tackling these key areas, ANZ companies can effectively close the digital gap and thereby enhance their competitive edge globally.
