70 to 90% of digital transformation projects in U.S. manufacturing fail, but only 7% of failures come from technology problems. The real issue: 93% fail because of people and process misalignment, usually because teams pick technology solutions before they've defined what business problem they're actually trying to solve.
We started looking at success and failure of digital transformation projects. And depending on the— and this was US, these were US numbers, but 70 to 90% of the projects that were kicked off that were under the umbrella of digital transformation and digitalization of manufacturing, 70 to 90% failed to meet their objectives. And we— so then you go, well, why? What's behind all this? And 93% of the failures were due to process and people. 7% was due to technology failure. So the good news is, right, the products that are being offered in the marketplace from a technology standpoint do what they say they're going to do. So what are the major issues around people and process that are causing these projects to be less valuable than what they're stated? And the number one problem was lack of alignment of these projects to their business objectives. So, and you see this a lot if you're talking with IT and OT professionals and you ask them the question, What business problem are you trying to solve? What's the objective of doing this? They'll give you a lot of technology speak. Oh, we need to put a database in because we need to do this. And, you know, we need to have single sign-on and federated this, and we need to go to the cloud and kind of go, I didn't ask you about the technology platform and why you chose that platform. I asked you the question of what are you— what business outcome are you achieving by implementing this solution? And usually no one can explain it. That's the root source of this. And so when the Smart Manufacturing Institute said, we see that too, how can we address this number one problem of lack of alignment to the technology progression we need to make with the business outcomes? We created this acceleration framework for developing a roadmap for the manufacturers, and we set technology aside at the beginning of this entire process.
