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Digital transformation requires significant investment, outside the traditional IT operating budget.

Many of the options for digital business transformation, such as acquisitions and ventures, require significant investment. So where does the money come from?

CEOs in Gartner’s 2017 CEO survey reported that the largest bulk of digital transformation funding comes from self-funding, rather than existing budgets, as they see the primary purpose of digital initiatives to win revenue rather than to save costs.

“This should give CIOs pause for thought, given conventional IT management works mostly on the basis of using operating budgets,” says Andy Rowsell-Jones, vice president and distinguished analyst at Gartner. “Digital transformation requires commitment, leadership, strategy, technology, innovation and importantly, money.”

Globally, interest rates on borrowing are at cyclical lows, and balance sheet cash reserves have been at cyclical highs. According to Rowsell-Jones, this year and next are likely to be the optimal timing points of overlap between the business cycle and the tide of digital business change.

“In two years’ time, the rising cost of capital could make strategic investment more expensive, and playing digital catch-up is harder,” he says.

CIOs should remind CEOs and CFOs that digital disruption is a fast foe when it strikes, and discuss the full list of ideas with them to see if different or more radical options could be tried.

Continue reading full article at https://www.gartner.com/smarterwithgartner/10-ways-to-fund-the-shift-to-digital-business/

Originally posted by 


Roan Vasquez

Roan Vasquez

Digital Experience Manager at AAXIS
Roan is a customer experience expert and digital transformation leader at AAXIS. Roan brings strong knowledge and experience on how to leverage digital to help his clients increase the business value they then deliver to their customers. Roan's expertise centers around marketing and sales automation, customer loyalty, customer engagement and omni-channeling retailing.
Roan Vasquez

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