What’s limiting digital transformation initiatives?

Data protection challenges are undermining organizations’ abilities to execute Digital Transformation (DX) initiatives globally, according to the Veeam Data Protection Report 2021, which has found that 58% of backups fail, leaving data unprotected. Veeam Software found that against the backdrop of COVID-19 and ensuing economic uncertainty, which 40% of CXOs  cite as the biggest threat to their organization’s DX in the next 12 months, inadequate data protection and the  challenges to business continuity posed by the pandemic are hindering organizations’ initiatives to transform. 

The Veeam Data Protection Report 2021 surveyed more than 3,000 IT decision makers at global enterprises to  understand their approaches to data protection and data management. The largest of its kind, this study examines how organizations expect to be prepared for the IT challenges they face, including reacting to demand changes and  interruptions in service, global influences (such as COVID-19), and more aspirational goals of IT modernization and  DX. 

Urgent action on data protection required 

Respondents stated that their data protection capabilities are unable to keep pace with the DX demands of their  organization, posing a threat to business continuity, potentially leading to severe consequences for both business  reputation and performance. Despite the integral role backup plays in modern data protection, 14% of all data is not  backed up at all and 58% of recoveries fail, leaving businesses’ data unprotected and irretrievable in the event of an  outage by cyberattack. Furthermore, unexpected outages are common, with 95% of organizations experiencing them  in the last 12 months; and with one in four servers having at least one unexpected outage in the prior year, the impact  of downtime and data loss is experienced all too frequently. Crucially, businesses are seeing this hit their bottom line,  with more than half of CXOs saying this can lead to a loss of confidence towards their organization from customers,  employees, and stakeholders. 

“Over the past 12 months, CXOs across the globe have faced a unique set of challenges around how to ensure data  remains protected in a highly diverse, operational landscape,” said Danny Allan, Chief Technology Officer and Senior  Vice President of Product Strategy at Veeam. “In response to the pandemic, we have seen organizations accelerate DX initiatives by years and months in order to stay in business. However, the way data is managed and protected  continues to undermine them. Businesses are being held back by legacy IT and outdated data protection capabilities,  as well as the time and money invested in responding to the most urgent challenges posed by COVID-19. Until these  inadequacies are addressed, genuine transformation will continue to evade organizations.” 

“There are two main reasons for the lack of backup and restore success: Backups are ending with errors or are  overrunning the allocated backup window, and secondly, restorations are failing to deliver their required SLAs,“ said  Allan. “Simply put, if a backup fails, the data remains unprotected, which is a huge concern for businesses given that  the impacts of data loss and unplanned downtime span from customer backlash to reduced corporate share prices.  Further compounding this challenge is the fact that the digital threat landscape is evolving at an exponential rate. The  result is an unquestionable gap between the data protection capabilities of businesses versus their DX needs. It is 

urgent that this shortfall is addressed given the pressure on organizations to accelerate their use of cloud-based  technologies to serve customers in the digital economy.” 

IT strategies impacted by COVID-19 

CXOs are aware of the need to adopt a cloud-first approach and change the way IT is delivered in response to the  digital acceleration brought about by COVID-19. Many have already done so, with 91% increasing their cloud services  usage in the first months of the pandemic, and the majority will continue to do so, with 60% planning to add more cloud  services to their IT delivery strategy. However, while businesses recognize the need to accelerate their DX journeys  over the next 12 months, 40% acknowledge that economic uncertainty poses a threat to their DX initiatives. 

DX starts with digital resiliency  

As organizations increasingly adopt modern IT services at rapid pace, inadequate data protection capabilities and  resources will lead to DX initiatives faltering, even failing. CXOs already feel the impact, with 30% admitting that their  DX initiatives have slowed or halted in the past 12 months. The impediments to transformation are multi-faceted,  including IT teams being too focused on maintaining operations during the pandemic (53%), a dependency on legacy  IT systems (51%) and a lack of IT staff skills to implement new technology (49%). In the next 12 months, IT leaders  will look to get their DX journeys back on track by finding immediate solutions to their critical data protection needs,  with almost a third looking to move data protection to the cloud. 

“One of the major shifts we have seen over the past 12 months is undoubtedly an increased digital divide between  those who had a plan for Digital Transformation and those who were less prepared, with the former accelerating their  ability to execute and the latter slowing down,” concluded Allan. “Step one to digitally transforming is being digitally resilient. Across the board organizations are urgently looking to modernize their data protection through cloud adoption.  By 2023, 77% of businesses globally will be using cloud-first backup, increasing the reliability of backups, shifting cost  management and freeing up IT resources to focus on DX projects that allow the organization to excel in the digital  economy.” 

“The ongoing pandemic and uncertain market conditions have had a significant impact on Indian organizations’ IT  strategies. IT delivery witnessed a massive change with organizations aggressively adopting cloud first approach and  putting even more pressure on legacy data protection. According to Veeam’s Data protection Report 2021, 64% of  Indian organizations accelerated their DX initiatives to enable real-time data capture, lower processing time, and  accelerate business outcomes. 73% of Indian organization increased cloud adoption and 73% increased their hybrid IT deployment,” said Sandeep Bhambure, Vice President and Managing Director, Veeam India and SAARC.  

“Having said that, organizations also face tremendous IT challenges with respect to legacy systems and data  protection. 77% Indian organizations face an issue with recovering applications in an acceptable timeframe and 69%  of them face a ‘protection gap’. Hence, IT leaders are looking for immediate results to address their critical data  protection needs. For 32% of respondents the most important driver for change is improving the economics of their  solution, including improving ROI/TCO and reducing hardware/software costs or changing consumption models from  CapEx to OpEx. As the demands of a modern enterprise gets complex, data protection and management must evolve  to a higher state of intelligence across all environments.”