Is Your Approach to Building Digital Strategy Holding You Back? 

Businesses are increasingly investing in digital solutions to meet rising customer expectations and drive growth. According to a study by McKinsey, over 65% of executives say their companies have increased spending on digital initiatives due to customer demand. Additionally, Gartner reports that 56% of CEOs view digital improvements as a top priority for driving revenue growth, underscoring the strategic importance of digital transformation. Yet, despite these investments, many organizations struggle to achieve the digital transformation they envision. Why? The problem often lies in the approach itself. Here are the most common pitfalls holding organizations back and how they impact the company’s ability to drive sustained growth—along with strategic shifts that can make a difference.

1. No Leadership-Level Vision, Product Ownership or Roadmap 

The lack of a clear vision and leadership buy-in can result in a reactive approach. Especially in sales-driven B2B companies, digital tools are often developed to address a single customer or account’s needs. Without a dedicated product owner or roadmap, development teams become consumed by short-term requests instead of working towards a strategic vision. This reactive approach leads to over-customization, technical debt and inflated budgets, which often produce low value for both the customer and the business. 

A digital strategy without a strong leadership vision can never become a catalyst for growth. To build and maintain buy-in, leadership must see digital transformation as integral to their overall growth agenda — not just an IT initiative but a central driver of efficiency, customer experience and new revenue streams. 

How this impedes growth: Without a clear digital vision, companies fail to differentiate themselves in the market, struggle with scalability and often miss out on new revenue opportunities. The result is stagnation in key growth metrics like customer acquisition, revenue and market penetration. 

Making the strategic shift: Successful digital transformations start at the top. It’s critical that leadership articulates a digital vision that aligns with the company’s overarching business strategy. This means moving beyond one-off digital projects to embedding digital as a core driver of the company’s growth. Clear product ownership is essential, ensuring that there is accountability for steering the digital direction and maintaining focus on long-term goals. A well-defined digital roadmap with a focus on scalability, innovation and customer value provides the necessary guidance to stay on course amidst competing priorities. 

2. Have a “Build It and They Will Come” Mentality 

There’s a persistent myth that launching a new digital tool or platform will instantly bring success. The truth is technology alone isn’t a silver bullet. Merely investing in a platform without understanding its role in your business strategy leads to wasted resources. Successful digital products require a deep understanding of customer needs and the flexibility to adapt as those needs evolve. They also need a strategy for driving adoption, both internally and with customers. 

When companies fail to integrate their digital efforts with their broader growth strategy, they miss opportunities to enhance customer engagement and increase market share. A poorly adopted tool becomes a sunk cost, diverting attention and resources away from other strategic growth initiatives. 

How this impedes growth: An underutilized digital product fails to generate the expected return on investment, resulting in lost revenue opportunities. It also undermines customer confidence, impacting long-term customer loyalty and retention. 

Making the strategic shift: Businesses must move beyond the “build it and they will come” mindset to a more holistic and customer-centric approach. This involves understanding not just what customers want, but how digital capabilities fit into the broader customer journey. Design thinking can play a pivotal role, driving companies to prototype, test and iterate digital solutions in close alignment with customer needs. Moreover, digital initiatives should be tied to measurable business outcomes. Aligning digital tools with KPIs such as customer acquisition, engagement rates or sales growth can ensure that investments are not just technically sound but also commercially viable. 

3. No Planned Funding Beyond Product Launch 

Launching a digital product is just the beginning, not the end. Yet, many businesses fail to plan for ongoing funding to support post-launch iterations, updates and user engagement. This lack of continuous investment can make even the best-designed product quickly obsolete. In fact, studies show that 70% of digital transformations fail, often due to short-sighted budgeting and underestimating the need for sustained investments post-launch (Boston Consulting Group, 2020). 

A lack of post-launch funding stifles innovation and prevents companies from responding to market changes. Digital platforms must evolve to keep pace with shifting customer expectations and technological advancements. Without a commitment to continuous investment, companies can’t capitalize on growth opportunities that arise from an agile and evolving digital strategy. 

How this impedes growth: A stagnant digital product reduces competitiveness and limits revenue expansion. Companies that don’t invest in product evolution will likely face declining engagement and lower profitability over time. 

Making the strategic shift: To truly leverage digital as a growth driver, companies must adopt a mindset of continuous evolution. Digital products should be viewed as living assets that require ongoing investment, iteration and optimization. Budgeting should reflect a commitment to long-term value creation, not just initial product launches. Agile methodologies, which emphasize iterative development and rapid response to change, can help companies adapt to evolving market demands. Measuring ROI should also be dynamic—regularly assess the impact of digital tools on customer behavior, market trends and competitive positioning to make informed decisions about future investments. 

4. Over-Customization of Tools vs. Keeping a Clean Core 

Customization can be a double-edged sword. Over-customizing platforms can create technical debt and complexity, making future updates costly and time-consuming. Instead, organizations should focus on maintaining a “Clean Core” — using standardized solutions for non-differentiating functions and investing in tailored solutions only for areas that offer a competitive edge. 

Customization may seem appealing in the short-term, especially to meet specific customer demands, but it often becomes a barrier to scalability. Over-customized solutions can bog down innovation and limit the agility needed to support a broader growth strategy. Companies need to prioritize their unique differentiators, focusing customization efforts on what will drive revenue and competitive advantage. 

How this impedes growth: Over-customization drains resources and makes scaling digital solutions difficult, hindering the ability to drive rapid growth. It leads to inefficiency, making it harder to adapt to market demands and ultimately reduces the speed at which a company can capitalize on new opportunities. 

Making the strategic shift: Businesses need to adopt a strategic approach to customization—focusing only on what truly sets them apart. A “Clean Core” philosophy means standardizing non-differentiating elements to minimize complexity while concentrating custom efforts where they matter most for strategic growth. This approach not only accelerates time-to-market but also allows for greater flexibility in adopting new technologies. Companies that embrace a modular architecture can scale faster, reduce technical debt and be more agile in responding to new opportunities, ultimately driving sustainable growth. 

5. Lack of Data Governance/Data Architecture That Fuels Strategy 

Data is the backbone of any digital initiative but without a solid data governance framework, it’s hard to turn data into actionable insights. Effective data architecture not only ensures data accuracy but also enables faster, more informed decisions. Lack of governance leads to data silos, poor data quality and an inability to fully leverage analytics and AI-driven insights. According to a Gartner report, 87% of organizations have low business intelligence and analytics maturity, largely due to weak data governance frameworks. 

Data-driven insights are crucial for identifying growth opportunities, optimizing operations and personalizing customer experiences. Without a clear strategy for managing and utilizing data, companies miss critical opportunities to refine their value propositions, improve customer targeting and drive revenue. 

How this impedes growth: Poor data governance leads to inaccurate analytics, inhibiting a company’s ability to make strategic decisions that drive growth. This can result in misaligned sales efforts, missed customer opportunities and suboptimal product development. 

Making the strategic shift: To truly harness the power of data for growth, companies need to invest in robust data governance and architecture. This means establishing a single source of truth for data, implementing governance policies that ensure data quality and creating frameworks that facilitate the integration of analytics across the business. Embracing AI and advanced analytics should be a priority, but it requires a solid data foundation. Organizations that can turn data into actionable insights will gain a competitive advantage, driving better customer experiences, operational efficiencies and new revenue streams. 

A Case in Best Practices 

A Prophet client in the parts manufacturing and distribution industry spent 15 weeks defining its digital strategy, roadmap and business case before launching a minimum viable product (MVP) to a subset of customers, with the CEO as the executive sponsor. The strategy focused on the desirability, viability and feasibility of the solution and included a three-year roadmap with stage-gate check-ins to ensure progress. 

Customer service representatives were trained to support new tools and traffic-driving tactics were embedded in the investment plan. As the platform expanded to different business areas, customizations were only adopted if they aligned with the broader strategy. A focus on streamlining data and reducing complexity minimized integration challenges. 

This thorough approach is paying off, with increasing adoption driving cost savings and new revenue growth in emerging market segments. 

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