Home Strategy Growing investment in digital by Australian enterprises: survey

Australian organisations are expected to increase their investment in digital projects, with more than two thirds (76%) focusing on digital as part of their business transformation, according to a new report.

The State of Digital Transformation in Australia report, authored by Ovum Consulting and commissioned by Software AG and the FTS Group, says digital investment is set to increase as part of a growing IT market – with 78% of enterprises reporting they are focusing on digital initiatives.

According to the report, 33% of Australian enterprises are focused on transforming simple business processes and 35% are transforming complex ones.

Ovum say the survey of 115 enterprises in 15 industry sectors underlines the notion that digital transformation is top of mind for executives across many Australian enterprises.

Kevin Noonan, chief analyst at Ovum, says, “The survey provides some important messages about Australia’s digital progress. Almost none of the survey respondents (3%) believe digital is just an overused marketing term.

“Digital hype has long passed its use-by date, and it is now time to focus more clearly on the challenges of getting on with the job. The future environment for Australian enterprise will pose some big challenges, requiring a combination of new technologies and processes, as well as a realignment of existing business culture.”

The report reveals:

  • The top three key business challenges for Australian enterprises are agility (52%), cost efficiency (45%) and data capture and analysis (37%).
  • Just over two-thirds of respondents (68%) reported they are focusing on initiatives that are transforming business processes.
  • The top two constraints for organisations in driving innovation were the lack of tools and methodologies (60%) and lack of leadership from the top executive team (41%).
  • Cloud (44%), mobile (37%) and Internet of Things (35%) are the top technologies that are expected to have the most impact in driving digital initiatives over the next two years.

“The findings of the report show that attitudes about digital transformation among Australian enterprises have matured markedly”, said Mike Saxton, regional president, Asia Pacific and Japan at Software AG.

“Driving innovation is now viewed as an important consideration among enterprises. In today’s digital economy, customer satisfaction is key for organisations and the use of digital initiatives such as cloud, artificial intelligence and mobility technologies can considerably enhance the customer experience.

“Also, enterprises that focus on changing customer needs and address this well can be rewarded with a more cohesive workforce and increasingly loyal customers.Those that do this badly can find themselves trapped by inflated expectations and customer dissatisfaction.”

The survey also found that in the area of the Internet of Things, key drivers include operational efficiency (58%) followed by customer experience and engagement (52%) and improving service delivery (51%).

And the top three barriers to IoT adoption were data security and privacy concerns (62%), data analytics skills (55%) and lack of interoperability and integration complexity (50%).

According to Stephen Keys, chief executive, FTS Group, “The results highlighted that many organisations have an overly optimistic view when gauging their own performance and success in digital transformation. In a business environment where transformation is now a necessity, this is a red flag for many leaders.

“One often underestimated factor is the priority and investment given to planning and managing change.  Too often, people are expected to balance old approaches and systems whilst adopting new processes, structure and ways of working. Consequently, ignoring the volume of behavioural and organisational change required often sees projects fail.

“With $30 billion being spent in Australia on IT services in 2018, much of which is targeted towards digital transformation, we believe people deserve better and that business leaders must ensure a more holistic approach.”

The survey also found that overall, cost continues to be the key differentiator for choice of technology partner (50%) for Australian enterprises. In second place (43%), Australian enterprises prefer a strong Australian delivery and support presence which the report says relates back to the hidden complexity of digital transformation.

The survey also highlights recommendations for enterprises which include a need:

  • For more visible line management and executive management support for digital initiatives;
  • To provide more targeted focus for key business challenges relating to agility, cost efficiency and data; and
  • For enterprise executives to pay far more attention to agile methodologies. Typically, enterprises use agile methodologies for only 20 to 30% of projects, but when it is used, agile tends to deliver far superior results.


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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).


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