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How a lack of digital maturity stalls digital transformation

The term “digital transformation” is deeply embedded in every enterprise’s vernacular, and for good reason. In an environment of intense competition, growing customer expectations, legacy technologies, and new regulatory requirements, digital transformation is a matter of survival. 

Between 2017 and 2025, it’s expected that the worldwide spend on digital transformation initiatives will reach $2.8 trillion1. Despite throwing a lot of money at the problem, becoming a digital innovator is easier said than done.

Why the disconnect? Digital maturity. Here’s why it matters, and how it can help—or hinder—your digital transformation goals.


What is "digital maturity" and why does it matter?

Digital maturity indicates whether an organization is able to sink or swim in today’s digital landscape. Before organizations can create value and make headway towards their digital transformation goals, they must assess where they are in their journey, create short and long-term objectives, and make impactful transformation project investments.2 


Signs of limited digital maturity Signs of advanced digital maturity
  • Misaligned initiatives across the organization

  • Digital projects are informal and reactive

  • Legacy systems aren't integrated with emerging technologies

  • Limited foundational elements of technology are in place

  • Unable to compete with disruptors in the industry

  • Digital culture is not widespread and only championed by a handful of people
  • Defined set of priorities across the organization with a clear roadmap

  • IT strategy is aligned with the organization's overall vision and strategy

  • Emerging technology is embraced

  • Continuous improvements and optimizations occur regularly

  • Ability to keep up with industry disruptors

  • Culture of innovation and experimentation is organization-wide


Digital transformation and digital maturity go hand in hand—if organizations start digital initiatives without any level of digital maturity, they’ll soon hit speed bumps and waste valuable resources.


3 roadblocks that stall an organization’s digital maturity

1. Lack of institutional knowledge

Whether it’s one person remaining from the old engineering team from 10 years ago or a tenured employee who has performed a complicated back-office process optimization many times, institutional knowledge often sits with people who have worked at an organization for many years. 

But, once it comes time to tackle these obscure processes, it’s discovered that they’re only fully understood by those who came up with them years ago. They’ve only been passed down verbally, like a game of broken telephone.

Without having those processes documented, it’s difficult to map them out. Being forced to manually identify the pain point, use cases, data inputs, business rules, and data requirements slows down the entire project and points to a lack of digital maturity. And, once someone walks out the door without documenting that knowledge, understanding the process becomes even more difficult—and so does digitally transforming it.


2. Short-term strategy

In digitally mature organizations, technology experimentation and adoption is viewed as part of a larger integrated strategy that cuts across the organization3. It’s future-proofed into the roadmap so it can be leveraged for long-term initiatives across several departments. 

Organizations that lack digital maturity take more of a reactive approach. Instead of creating a long-term strategy that addresses a known issue, they turn to technology solutions as a fix. And, while quick technology implementations are often praised internally, when they’re not part of a larger strategic plan they can lead to problems down the road.

For instance, banks onboard new customers each day, and it often looks something like this:

  1. Customers go into a branch to fill out an account opening form and provide ID and proof-of-address documents.

  2. The branch employees have to enter the information into their system, approve all documents, and then send it to the back office for processing.

  3. The back office verifies each document again, performs a risk assessment and a compliance check, and does the required data entry.

  4. The customer waits for approval, and if there are any changes needed, they have to come back into the branch to fix them.

This onboarding example demonstrates a slow, manual process that is frustrating for customers. And, when it comes to automation, in today’s digital world, any process that relies on paper and manual back-office processing is one that shouldn’t be ignored. 

So, to make the onboarding process more streamlined and user-friendly, the bank might decide to invest in an automation solution, like RPA. They hope it will help them gain efficiencies by automating the transactional tasks involved in the onboarding process: extracting and copying customer data, form filling, and routine analyses. 

But, investing in RPA shouldn’t be the bank’s first step. Without a strategy that includes mapping the entire onboarding process, digitizing all of the paper-based inputs, and assessing the current technology ecosystem for data flow and integration, the bank will not be able to fully automate a process like this. They’ll have to go back to the drawing board and spend even more resources to fix the new process—because RPA only works efficiently when the bots are fed clean, structured data.


3. Unstructured data

Digital maturity means being able to quickly pivot and adapt as the market changes4. But, over time, large organizations amass mounds of unstructured data in the form of paper, documents, internal and external legacy processes, and more. The systems and processes that were once seen as helpful, are now a hindrance to digital transformation for a few reasons:

A. Paper processes and outdated systems aren’t as agile as they need to be in today’s digital age. 

B. Unstructured data from manual and paper-based processes can be hard to extract with 100% accuracy.

C. The unstructured data coming into the organization, combined with manual verification processes makes creating end-to-end digital experiences difficult.

Without being able to easily tap into critical data and information and leverage it for downstream processes, archival requirements, and compliance and audit checks, organizations will continue to struggle with reaching digital maturity.


Overcoming the obstacles

When you mix unstructured data with a lack of institutional knowledge, undocumented processes, and digital initiatives that aren’t future-proof, achieving digital maturity becomes an uphill battle.

Organizations can overcome this by building and charting out transparent digital experiences. In doing so, important institutional knowledge will be taken out of people’s heads and into the hands of those who need it. In the process, customer experience will improve, automation goals will be fueled by quality data, and there will be a single source of truth for key processes. To top it off, organizations will be left with seamless knowledge transfer across every process—and a blueprint for reaching digital maturity.


Laptop with data displayed on screen

Sources and credits

1 Statista: Spending on digital transformation technologies and services worldwide from 2017 to 2025

Deloitte: Digital Maturity Model

PIPA Partners: Digital Maturity

4 PIPA Partners: Digital Maturity