Business leaders’ conversations about digital transformation have evolved. Replacing the unrelenting drive of IT innovation, organisations are now prioritising considered strategies that deliver tangible value. Jolyon Vernon(pictured) Chief Technologist at Creative ITC, outlines practical steps to success, balancing ambition with the pragmatic pursuit of business-driven outcomes.
Perpetual IT innovation continues to promise competitive advantage and shows no sign of abating. 91% of technology decision-makers anticipate an increase in IT budgets this year, with CIOs in Europe poised for record level spending. Regardless of spending plans, the challenge for all lies in unlocking the full potential of IT investments.
Intelligent innovation
Artificial intelligence and machine learning (AI/ML) continue to dominate discussions about IT innovation. European spending on AI is predicted to reach $133 billion by 2028 with businesses deploying these technologies to revolutionise workflows, enhance decision-making, and enable delivery of highly personalised customer experiences.
AI has proven its value in areas such as risk management, payment fraud and debt analysis, flagging suspicious patterns to expedite necessary interventions and via automated threat intelligence and fraud analysis applications. Chatbots are prevalent across the retail sector and robots and autonomous vehicles are being deployed to reduce risk to workers in manufacturing and warehouses. In architecture, engineering and construction, AI is boosting productivity through workflow automation and making sites safer, while digital twins are informing designs, aiding materials selection, improving how plans are translated into completed structures and driving sustainable development.
Closely allied to this is the growing role of the Internet of Things (IoT). By connecting devices and systems, IoT enables organisations to gain real-time insights and optimise operations. Combined with advanced data analytics tools, IoT adoption and ML deployments are empowering businesses to make informed, data-driven decisions by uncovering patterns and forecasting trends that were previously out of reach.
However, this doesn’t mean these powerful technology developments are a silver bullet. Although AI spend in Europe is forecast to grow 21% this year, business leaders are increasingly looking beyond the hype in search of a compelling business case for investment. There’s increasing recognition that the transformative potential of AI and the ability to harness its benefits are very different things.
All too often, promising AI and IoT deployments expose underlying problems. Legacy IT infrastructure is frequently the most severe limitation revealed; one in three tech decision makers identify this as their biggest obstacle hindering innovation. Huge AI processing requirements overload data centre and network capacity, causing latency and outages. Attempts to share actionable insights with stakeholders can also expose weaknesses in IT architectures that weren’t designed to share huge datasets securely at speed and scale.
Robust data quality, management, modelling and storage capabilities are also an overlooked and under-invested area that is absolutely critical to the success of AI and IoT adoption. If neglected, IT leaders will struggle to deliver timely data analysis and surface the actionable insights their organisations need.
Closer cloud control
Cloud migration has long been a cornerstone of digital strategies. Public cloud offerings from hyperscalers continuing to dominate the ever-growing cloud market, with revenues in Europe forecast to grow 17.19% this year. But, putting all your eggs in one basket has never been a wise strategy – European organisations are increasingly diversifying their cloud models and turning to cloud repatriation, giving IT teams the freedom to decide where apps and workloads sit, particularly where there is need to meet data sovereignty and compliance requirements. For those who have experienced both the positives and pitfalls of public cloud adoption, retrieving applications or workloads from the public cloud is becoming recognised as a valuable strategy.
Many have fallen victim to ‘hidden’ costs associated with public cloud, such as hefty data egress charges and significant storage cost hikes following attractive entry fees. Almost all (96%) IT leaders who have repatriated workloads and applications away from public cloud providers stated cost saving as the main benefit. A similar number (95%) said their security posture had improved, while 85% organisations reported better performance, management control and business agility.
Success in the cloud hinges on making informed decisions about architecture, providers, and management tools—choices that demand careful consideration, expertise and long-term attention. The managed service provider route brings savings on infrastructure, upgrades, optimisation, licensing, application deployment, support and headcount. No matter the cloud environment, increased cloud consumption results in higher operating costs. Left unchecked, cloud sprawl leads to rising costs, complexity, and security and compliance issues. Robust governance is required to improve visibility and control, enabling organisations to right-size their cloud consumption by identifying waste and making data-driven decisions to optimise usage and manage costs.
Overcoming common obstacles
While investment in new technologies to continues to grow, a worryingly large proportion of digital transformation projects fail. Gartner’s 2025 CIO Survey found that less than half (48%) of digital initiatives meet or exceed their business outcome targets, and reported some common roadblocks organisations should consider to ensure their programmes succeed.
Alongside IT infrastructure challenges, a common hurdle to digital transformation is the lack of internal expertise, as the rapid pace of technological change often outstrips the skillsets of existing teams, resulting in poor ROI investments and stalled progress. Many businesses don’t have the luxury of employing extensive IT teams with the specialist new skillsets required to design and deploy new technology solutions, nor manage and optimise them in the long-term, thus enabling their company to realise the full business benefits. To address this gap, 71% of technology decision-makers plan to increase investment in IT personnel to facilitate digital transformation in the next 12 months
Looking beyond the realms of the IT department is equally crucial. Collaboration from the outset is vital for success, allowing businesses to prioritise technology innovation where it will have the greatest impact. Businesses who foster co-ownership of digital transformation between their CIOs and other C-suite executives are 1.5 to 2 times more likely to maximise the value from digital investments.
Rolling out any new technology enterprise-wide necessarily involves staff from across the organisation. Fostering IT alignment with the wider business should involve determining use cases, understanding system dependencies and required functionality, and evaluating workforce readiness. When teams work together towards a common goal, technology adoption becomes more seamless and impactful.
A phased adoption roadmap can help minimise disruption and resistance. Be mindful that any innovation interrupts the status quo – new technology implementation often disrupts daily operations, causing downtime and friction that can erode stakeholder confidence. Clear communication, coupled with employee training and support, ensures that changes are well-received and successfully integrated into daily workflows.
Engaging experts who bring technical know-how and industry-specific insights can also accelerate progress and optimise results. Their digital transformation experience can be invaluable to help overcome obstacles, address potential new security risks and avoid unplanned costs, ensuring your organisation maintains momentum for both BAU and innovation activities.
A new mindset
Instead of chasing every emerging trend, forward-thinking organisations are adopting a more considered, structured approach to digital transformation. Aligning IT initiatives with overarching business goals and setting clear KPIs ensures efforts are both relevant and measurable. By focusing on incremental improvements, businesses can demonstrate quick wins that build momentum and confidence. For example, automating repetitive tasks or enhancing specific workflows can deliver immediate benefits while paving the way for larger-scale initiatives.
Rather than viewing technology adoption as a race to outpace competitors, businesses should evaluate their unique needs and circumstances. This approach not only mitigates risks but also ensures that every investment contributes tangible value. By striking the right balance between ambition and pragmatism, they will more easily navigate the complexities of digital transformation and emerge stronger and more competitive in the process.
