White Paper

Business Value of Digital Transformation and the Contributionof a Growth Mindset in IT
Sponsored by: Microsoft
Cushing Anderson
May 2020

IDC OPINION
The success of business increasingly relies on the IT organization supporting business requirements
and often implementing new and evolving technologies. New research from IDC demonstrates that IT
professionals who have achieved a relevant technical certification are more likely to have a self-belief
that competence can be developed through dedication and hard work and a willingness to leveragetools and learnings of others — what is called a "growth mindset." A growth mindset creates a capacity
and resilience essential for great accomplishments. This is particularly important for organizations andtheir IT professionals responsible for implementing technology transformation in support of criticalbusiness objectives and implies a need for continuous professional development and represents
another value of IT certifications to the enterprise.

SITUATION OVERVIEWTechnology has moved out from the IT department to the desktop, to tablets, and to a phone in every
pocket. In fact, there is more "digital transformation (DX)" happening outside the IT organization than
within it. (This is provocatively asserted in the HBR article Digital Transformation Is Not About
Technology.) As an organization senses an opportunity, it deploys a new approach, or improves anexisting approach, using technology to help streamline, automate, discover, or connect. These
innovations are often incremental and sometimes disruptive but always attempt to solve a businessneed. Digital transformation is ushering in a new era of digitally enabled customer-facing products,
services, and experiences in an environment of rapid change and uncertainty. Organizations asdiverse as Hasbro, Home Depot, and Frette leveraged technology, yes, but transformed their business
operations and the finance organization to enable their own digital transformation. In detail:▪

Hasbro: In 2012, Hasbro realized it needed to change almost 90 years of corporate culture:
instead of focusing its marketing and sales efforts on children, it must market to their parents
who make the purchase. The company leveraged data to create targeted marketing
campaigns on multiple channels, including a larger push on social media. The data helped thecompany better understand its customers and recommend relevant toys and games toparents. This was an effort to improve marketing leveraging analytics and sales data.

▪

Home Depot: In 2017, Home Depot began a three-year program to improve and combine its
physical and online shopping experiences. It wants contractors and homeowners to shop online
and pick up in store. By tracking local trends, it can also ensure the right items are in stock without
excess inventory. The investment has helped build up the back-end operations and distribution
channels to consistently deliver products and resources to stores and customers.

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Frette: Italian luxury linen purveyor Frette is a small company with a global reach and revenue
that belie its head count. Based in Italy, the company sells its products online and in retail
outlets around the globe. The company's growth beyond Europe created coordination
challenges caused by different currencies, languages, and systems. The digital transformationof its financial systems helped it gain greater insight into its business and streamline customer
service — reducing monthly closing time by 40% and freeing management to focus on growth.
It also lowered shipping and freight costs and transformed reporting.

Technology is at the center of business growth for all companies, new and old. While the business isdriving change, ultimately, transformation requires an IT organization with the right skills.

People and Skills Are Critical to Transformation Success
People are the make-or-break element of a high-performing IT organization. There is simply no
replacement for people with the right skills, attitudes, and traits. As technology evolves, CIOs don't
have the luxury of hiring a totally new roster of skilled IT professionals. They must leverage the talentand training resources available to build the teams that will help drive their digital transformation. At
the same time, the skills IT professionals need are continuously evolving because IT professionals are
assuming new roles, new systems are installed, new configurations take fuller advantage of solution
capability, and solutions deploy new features to overcome vulnerabilities. The continuous evolution ofskills requires a conscientious program of continuous learning and development.
A director of worldwide support readiness at a large technology firm explained that in the everchanging technology environment, adaptability is essential. "To address the fast-paced change intechnology requires good subject matter understanding," she told IDC. This puts a premium on
understanding the skill requirements by role and makes role-based technical certifications an effective
approach for upskilling and reskilling IT professionals.
As the Hasbro, Home Depot, and Frette examples show, DX doesn't need to be built on robotics, AI,and edge devices: Most DX is deploying and effectively using core capabilities — better collaboration,
integrated applications to improve communication, and improved data analytics and reporting. And
these core capabilities represent both the foundation of what most businesses require to succeed anda performance benefit to the IT organization itself. IDC estimates that trained and certified teams
responsible for core IT activities are almost 20% more productive than less proficient staff.

Business Leaders Feel IT Capabilities Are Important to Business Success
In IDC's recent Drivers of DX Success in the Line of Business Survey, we asked nearly 300 leaders inoperations, finance, sales, and marketing about what digital transformation meant to theirorganizations. We discovered that the capabilities that those leaders believe would most benefit theirsuccess aren't "rocket science." In most cases, using the existing tools and capabilities better would bea vast improvement in business satisfaction with IT and lead to greater business success.

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We examined several capabilities related to operations and financial processes and found that theprocesses that lines of business (LOBs) believed were most important were also the areas where their
IT organizations didn't perform well. For finance and operations leaders, the three capabilities thatwould make the most difference aren't radical transformations. Their greatest benefits are as
straightforward as supporting, reporting, and visibility (see Figure 1):▪

Supporting: Both finance and operations felt their ability to support their stakeholders was very
important. Supporting stakeholders is also an area where they believe they could performbetter. The finance leader expects to be able to reorient financial discussions from static views
focused on historical data to dynamic views of future trends, opportunities, and innovation. The
operations organization wants to be able to perform maintenance before failure occurs andavoid costly downtime of business-critical equipment.

▪

Reporting and visibility: For many organizations, the greatest benefits of DX would be from
improved dashboards and reports — more than two-thirds of finance and operations leaders
felt they needed improved reporting and dashboards. Finance and operations leaders also
expect improved visibility into operational or financial performance. These leaders want to beable to assess the health of their business and make strategic decisions faster to drive growthby using real-time and unified financial or operational reporting. The operations group expects
to be able to leverage a real-time view into production and stock to manage shop floor
activities and improve uptime, throughput, and quality.

We also examined many priorities related to the critical processes within marketing and sales andfound the important issues that are essential to successful identification and closing of opportunities:▪

Combining data: Commonly important to both marketing and sales leaders is the ability to
combine historical and real-time information. Many marketing and sales leaders believe
integrating data from different sources is important. Unfortunately, nearly all organizations
think they aren't particularly good at it. Marketing and sales organizations want to be able tobuild customer profiles that connect data from multiple applications.

▪

Customizing reports: Similarly, the ability to customize reports and dashboards is important toboth marketing and sales leaders. Similarly, less than 10% of organizations believe they aregood at these priorities. Marketing and sales organizations believe it is important to accurately
identify new audience segments and trigger workflows based on customer and segment
signals.

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FIGURE 1
Drivers of Success: Line-of-Business Perspective
Q.

How important to your organization is being able to … ?

Q.

How well does your organization … ?

Finance LOB

Operations LOB

19

Simplified support
Customized reports and dashboard

15

Visibility into operational status
Visibility into financial status

10

Continuous close

12

AI-enabled support

10

46
45

Visibility into operational status

10

Visibility into financial status

12

43
29
20

40

Continuous close

4

AI-enabled support

660"We do it well"

Customize reports and businessdashboards

10

5

42
8
43

13

Simplified customer support
engagement

33
40

60

80

% of respondents"We do it well"

43
7

AI to improve customer support

33

20

15

Customize reports and businessdashboards

52

0

60

"Its important"

Combine historical and real-time
data3

Simplified customer support
engagement

40

Sales LOB
62

AI to improve customer support30
20"We do it well"

Marketing LOB
8

57

14

% of respondents"It is important"

Combine historical and real-time
data

58
41

0

% of respondents

53

14

Customized reports and dashboard

38

0

20

Simplified support

50

10

43
0

20

40

60

% of respondents"It is important""We do it well""It is important"n = 150 finance and operations leaders and 120 marketing and sales leaders
Note: Percentage of respondents selecting 4 or 5 on a 5-point scale is shown.
Source: IDC's Drivers of DX Success in the Line of Business Survey, 2020

To Transform the Business, Transform IT
Across all of these examples, business transformation requires the IT organization to enable DX
initiatives and DX evolution within the LOB. It is the IT organization's capability that will drive DX
success. IT is typically a profession that thrives on change and embraces new opportunities. But DX
success doesn't happen by accident.
It will require a change in IT — sometimes new ways of working and often new skills in IT. But morethan that, it requires a desire to change: A willingness of the IT professionals to put in the effort to learn
new skills and apply those new skills to new problems.

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Growth Mindset Influenced by IT Certification
LOB seems to recognize this: The line of business seems to believe that the most important factors insuccessful evolution in IT isn't a new technology or a new consultant. It's a willingness to put in theeffort, time, and training to become knowledgeable and skillful with new technologies.
Individuals who believe they can develop their capability through effort, time, and training have what
researcher Carol Dweck calls a growth mindset. These individuals achieve more than individuals whobelieve their talents are innate gifts, what is described as a fixed mindset. IT professionals with agrowth mindset are less concerned with being the "smartest person in the room" and put energy into
learning and using new skills.
When IT organizations embrace a growth mindset, IT professionals report feeling far more committed
to the organization and empowered to put the organization's vision into practice. By contrast, people inorganizations that are primarily fixed mindset rate higher in only one organizational characteristic:
more deception between employees.
Interestingly, Dweck and other researchers have discovered that a fixed mindset isn't static. Individuals
can nurture a growth mindset through the process of developing new skills. In IDC's recent Drivers of
DX Success in the IT Organization Survey, more than 650 IT leaders across a variety of roles
described a strong correlation between growth mindset and IT professionals who have learned a newskill recently or have been certified in a challenging domain.
Our research found that IT professionals who were certified were consistently more likely to believe
they could learn difficult skills and learn more from others. 91% of certified IT professionals believedthat effort strongly contributes to their DX success. The same proportion of IT professionals believethat training strongly contributes to DX success. Only a slightly lower percentage believe that timespent with a new technology strongly contributes to success (87%). Other factors also contributestrongly to success, including the technical material that accompanies a new technology, case studies,and other examples of successful adoption of DX and the support from technology vendors andconsultants. Even leveraging AI to assist with the technical design and deployment of a technology cancontribute to the success of DX. But, surprisingly, we found that certified IT professionals were more
likely to believe each of these factors would contribute to success than IT professionals who were notcertified (see Figure 2):▪

Effort: Certified IT professionals were 2 points more likely to believe that effort contributes to
DX success than IT professionals who were not certified (91% to 89%).

▪

Time: Certified IT professionals were 3 points more likely to believe that time contributes to DX
success than IT professionals who were not certified (87% to 84%).

▪

Training: Certified IT professionals were 17 points more likely to believe that training
contributes to DX success than IT professionals who were not certified (91% to 74%).

▪

Leveraging AI: Certified IT professionals were almost 40 points more likely to believe
leveraging AI strongly contributes to DX success than IT professionals who were not certified(76% to 37%).

Certified IT professionals are more likely to believe their skills can be developed. They also believethat through hard work, good strategies, and input from others, they can succeed in their DX initiatives.
This is the essence of a growth mindset. Therefore, we conclude that certified IT professionals embody
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FIGURE 2
Contributors to DX Success: What Helps IT Professionals Implement
Complex Technologies
Q.

Please rate how much the following contributes to your team's implementation of DX.

What Contributes to Success?
Leveraging AI+39 points more

Consultants+18

Support from technology vendor+17

Case studies from others+22Technical material+11

Training

+17

Time

+3

Effort+2 points more
0

10

20

30

40 50 60 70(% of respondents)

80

90

100

Not certified
Certifiedn = 670 IT professionals
Note: Percentage of respondents selecting 4 or 5 on a 5-point scale is shown.
Source: IDC's Drivers of DX Success in the IT Organization Survey, 2020

CHALLENGES/OPPORTUNITIES
By the end of 2019, up to 70% of companies engaged in digital transformation efforts struggled totranslate business needs into effective IT investments and operations plans. That is often because
they don't have the skills they need to build and execute an effective transformation. In other IDC©2020 IDC

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research, 304 IT leaders report that "having the right skills in-house" is their biggest challenge tosuccessfully completing digital transformation. Other challenges exist too — developing new
applications, migrating workloads to the public cloud, and data integration issues. But each of those isimpacted by the skills of the IT professionals in the organization.
Identifying IT professionals with the right skills has never been straightforward. And in this period of
rapid change and economic disruption, it has never been harder nor more important. Recognizing or
validating specific competence can be a challenge. IDC believes that leveraging relevant, wellconstructed IT certifications from significant technology vendors can help IT leaders build a successful
IT organization and effectively execute digital transformation initiatives.
Certification programs can also be part of a reliable development road map to help organizations build
skills during every phase of a transformation journey. IDC analysis has determined that IT
professionals should get at least 10 hours of job role–related training every year to remain current. And
additional training is necessary when significant digital transformation projects are being planned. For
important roles, IT leaders should seek advice from their technology and tool providers to identify the
specific skills and training paths necessary to upskill the role to meet future needs. Technology
vendors with relevant certification programs are in a unique position to support the skills requirementsof a range of IT and business professionals.
To effectively leverage IT certifications for increased DX success, it is essential that the certification
program be a good fit for your organization. Consider the following seven criteria as a starting place forselecting an appropriate IT certification program:▪

Is the certification program from a significant provider of your IT infrastructure? Or is thecertification program so significant industrywide that it is an "industry standard"?

▪

Is the certification program aligned to roles that are relevant to your organization's current andfuture requirements? (Are you willing to be committed to these roles for the long term?)▪

Are the skills represented by the certification program evolving with the technology?

▪

Does the certification program have progression that is sufficiently robust to grow with your staff?

▪

Does the certification program use performance-based exams?

▪

For appropriate roles, does the certification program validate business knowledge and skills in
addition to technical competence?

▪

If you are going to use the certification program for selection or promotion, does thecertification program ensure that the exams have not been compromised?

CONCLUSION
To successfully implement DX to support critical business objectives, IT organizations will need toadopt new skills, leverage new technologies, and continuously upgrade their skills to maximize thevalue the DX initiative delivers to the enterprise.
The willingness of IT professionals to leverage all of the resources that can help DX initiatives succeed
will be critical and is the essence of a growth mindset. While research consistently shows that training
and certification lead to greater performance, this research indicates another benefit of certification:
certified IT professionals are more able to adopt new processes and skills and apply them to thebenefit of their organization and have a growth mindset.

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To leverage this finding to improve business success with digital transformation, it is essential that IT
organizations:▪

Align IT organizational requirements and development plans with DX strategy.

▪

Leverage IT vendor certifications as guides to IT professional development.

▪

Provide sufficient ongoing training and relevant certification opportunities to maintain andimprove skills over time.

▪

Monitor DX projects and operational priorities for new/expanding skill requirements.

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MESSAGE FROM THE SPONSOR
About Microsoft
As companies are evolving with digital transformation to bring new ways of generating value(learn more), Microsoft learning resources enable you and your organization to get there too.
Microsoft Certifications ensure individuals and organizations are kept up to date with necessary
skills and ability to perform job roles in a modern digital business. They also validate the ability
to demonstrate "doing" skills and hands-on real-world scenarios with performance-based
testing.
And as products and technology update, keep up to date by building technical skills while
preparing for certification with updated learning content. Get started on Microsoft Learn with
free, interactive, hands-on training or dive deep with instructor-led training offered by Learning
Partners and taught by Microsoft Certified Trainers worldwide.

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9About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory
services, and events for the information technology, telecommunications and consumer technology
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media, research, and events company.

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