by Stewart Rogers, VentureBeat

VentureBeat reports on Brian Solis’ recent “State of Digital Transformation” study.

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Digital transformation, it would seem, should be a top priority for every business.

At VB Insight, our research is clear on this — if you’re not reaching people on their smartphones, you’re not reaching your potential audience. And if you’re not taking advantage of digital marketing techniques, you’re unlikely to do well in almost any market in 2017.

Today, Altimeter — the research company owned by Prophet — has released its third annual “State of Digital Transformation” study, and the findings aren’t particularly promising.

Despite “digital transformation” being a favorite topic within businesses, the survey reveals that many are still not operating with any sense of urgency when it comes to investing in new technologies, models, and teams.

So, why are so few businesses investing in the digital customer, despite the breadth of research suggesting that for most it’s the only way forward?

“With all of the talk of customer experience, it’s a shame how little the customer is at the center of digital transformation,” Brian Solis, principal analyst and futurist at Altimeter, a Prophet company, told me. “The majority of businesses are planning roadmaps and making investments with incomplete information about the customer. For example, this year’s findings show that only 34.8 percent of businesses have fully mapped the customer journey within the last year — down from 54 percent last year.”

Fortunately, the study also includes some good news, such as it is.

“On a more promising but still disappointing note, companies are studying the mobile customer journey and designing for real-time ‘micro moments’, in addition to customer journey work,” Solis said. “In 2017, the percentage of companies doing so is up from 20 percent in 2016 to 48.5 percent.”

So, to put it bluntly, the customer has become more informed, is wiser than ever, and expects companies to follow suit, but brands have yet to understand this or act accordingly. And while respondents cite “evolving customer behaviors and preferences” as a top driver of digital transformation, fewer than half invest in understanding digital customers.

“Another way to answer it is that companies really haven’t had to be customer-centered, and that is a function of business norms,” Solis said. “That has to change.”

So what was the most surprising result from the study?

“What surprised us most is just how far behind companies are in their digital transformation efforts,” Solis said. “In fact, when executives benchmark the status of their efforts against our maturity model, ‘The 6 Stages of Digital Transformation‘, they consistently peg themselves further along than they really are.”

Solis also notes that there is a shift in power when it comes to digital transformation.

“This is the first year where ownership of digital transformation has shifted from the CMO to the CIO,” Solis said. “But it’s not about marketing versus tech. And, contrary to its name, digital transformation is more than digital. All of these things are indicative of less mature companies limiting the scope of digital transformation to functions, rather than exploring enterprise-wide initiatives. More advanced companies, however, are investing in modernizing business models and operations, as well as in key business units and departments.”

The report also shows that organizations face significant challenges. A lack of digital talent and expertise is one issue, according to 31.4 percent of respondents. And the perception that digital transformation is a cost center and not an investment is reported by another 31 percent.

So how will we ultimately change these perceptions?

“A good friend of mine, Peter Sims, wrote a book called ‘Little Bets‘, Solis said. “I took away from him many insights, but one, in particular, is in the name of the book. Companies need to place little bets that are cross-functional in nature — for example, modernizing CX and MX (mobile experience) in areas that will have an impact, creating alignment and demonstrating progress and success to the C-Suite and among all stakeholders.”

The full study — which took in data from 528 qualified digital transformation strategists and executives leading change in the United States, Canada, the United Kingdom, France, and Germany — is available from today via the Altimeter website.