By Sudhanshu Mittal, Head & Director Technical Solutions, Nasscom CoE
In an era where digital transformation is a key driver of growth, industries are increasingly looking to integrate new digital technologies to enhance productivity, efficiency, and competitiveness. However, the adoption of technology is not always seamless and organisations typically face significant challenges that hinder successful implementation. It is imperative that organisations address their internal challenges if they are to take advantage of the benefits that digital technologies can provide. In this article we explore the most common challenges and how organisations overcome those.
Upfront CAPEX Investment
Digitalisation requires upfront CAPEX investment in purchase of hardware, software tools, training etc. Many businesses especially SMEs struggle with the upfront costs of new technology and this act as hindrance in technology adoption.
Solution: Many of the solution providers have come up with pay-as-you-go model whereby instead of upfront CAPEX investment, they charge monthly rental. Also instead of collecting and storing data at premise they take that in cloud. As a result the CAPEX model is converted to OPEX model, making it relatively easier for organisations to proceed with adoption. Depending upon the benefits observed, they can make decision on further continuation. SME players looking for such solutions can work with players like Nasscom CoE to identify the right solution partners and proceed with digital adoption.
Change Resistance
In many cases the shop-floor employees and mid management resist adopting new technology due to lack of understanding, comfort with traditional methods, fear of job loss or in some cases the detailed insight that technology can create. A rigid organisational culture can slow down digital transformation.
Solution: Change management is a complex but critical requirement when organisation decides to go ahead with technology adoption. This requires clear communication about the benefits of new technology, adequate training and most critically turning employees and management in partners. A purely top driven approach will never work as people downstream will find ways to obstruct the deployment impact. They need to understand that adoption is not to take away their jobs but to help them in doing it better and become more efficient in their output. Only then they will be willing to move ahead with adoption.
Lack of Skilled Workforce
The shortage of skilled professionals to implement and manage new technologies, is a major challenge. Many industries struggle to find employees proficient in emerging technologies such as AI, blockchain, and IoT – not just in development but in managing the adoption.
Solution: Upskilling existing employees, and exploring collaborating with educational institutions to bridge the skill gap is the only way for organisations to build a capable workforce. Added advantage is that it will provide additional motivations to employee for their career path.
Unclear ROI and mapping to the Business Case
In many cases it is difficult to precisely justify the return on investment (ROI) when adopting new technologies. Many of the benefits (e.g. precise production data, daily automated report, better prediction of day’s output) are difficult to put a figure on. Due to this decision-makers are reluctant to proceed, especially in SME segment.
Solution: While large organisations are able to do pilot programs, and data-driven assessments to demonstrate tangible benefits, SME players can work with entities like Nasscom CoE to identify the measurable benefits with digital adoption. Setting key performance indicators (KPIs) to measure success can also help in tracking ROI.
Integration with Legacy Systems and Rapid Technology Changes
Many industries especially SME plaers operate on outdated infrastructure that is incompatible with modern technology. Retrofitting new solutions into legacy systems can be a challenging task. In addition many times management is concerned with technology obsolescence due to rapid changes.
Solution: There are many solution providers especially startups, which have developed solutions that can be integrated with legacy IT systems also and organisations can especially look for players with such capabilities. While technology changes are way of life, the key impact here is reduction in cloud cost / higher internet speed etc. Hardware components have long shelf life and organisations need not worry about their obsolescence.
Data Privacy and Security Concerns
With increasing cyber threats and stringent data protection regulations, organisations are often hesitant to adopt new technologies due to security risks.
Solution: Using cloud based services obviates to significant extent the cyber security challenge for organisations as the cloud service providers handles the security aspect and to large extent the data protection regulation compliance also. While these challenges will remain in future, organisations need to find ways to move ahead with adoption and benefit from adoption.
While digital technology adoption comes with its challenges, strategic planning, employee engagement, and investment in training can help organisations overcome these obstacles. Nasscom CoE has built up expertise in helping organisations of different sise in addressing any specific challenges and used these capabilities to help large numbers of players in different segments with digital adoption.