Annual Report
STATE OF DIGITAL TRANSFORMATION
LEVERAGING MOMENTUM
As 2025 begins, digital transformation (DX) continues to shape the competitive landscape across industries in Australia. Organisations navigate a constantly evolving technological landscape, where agility, innovation and resilience are no longer competitive advantages but essential capabilities for survival.
The convergence of artificial intelligence, cloud computing, machine learning and automation technologies has accelerated the pace of change, enabling businesses to reimagine processes, enhance customer experiences and unlock new revenue streams. This progress, however, comes with heightened challenges, including cybersecurity risks, regulatory complexities, talent shortages and sustainable requirements.
For C-suite leaders, the stakes have never been higher. Decisions about technology investments are not just about staying current—they define the trajectory of the organisation’s growth, efficiency and relevance in an increasingly competitive global market. This report provides a comprehensive analysis of the state of digital transformation in 2025, highlighting key trends, and actionable insights to guide strategic decisions.
Digital business transformation is not just about technology—it is about creating value and securing long-term growth. As you read this report, consider how the digital transformation trends outlined can help your organisation achieve its strategic goals and thrive in an ever-evolving market.
DIGITAL LEADERS in Australia transform AND Thrive
Navigating Economic Uncertainty
Spending plans for 2025 reflect a deliberate and systematic approach to driving growth and resilience as organisations refine their digital transformation strategies.
Macroeconomic factors such as inflation and hybrid working influence strategic decision-making. Our research examines how organisations manage these dynamics, balancing ambitious transformation goals with pragmatic financial and operational planning to position themselves for long-term success.
Systematic Approach to Spending
Organisations anticipate inflationary pressures and new ways of working to impact spending, but confidence is high that digital transformation investments will meet the expected return on investments.
of organisations plan to increase technology spend in 2025.
Shifting Priorities in Digital Transformation Goals
Improving customer experience has been a core tenant of digital transformation trends in the last several years and remains a priority, however this year it has been supplanted from the top spot among digital transformation goals.
For 2025, organisations will focus on reducing operational inefficiency and addressing technical debt. AI technologies grab the headlines, but the drag of technical debt remains a burden organisations must address.
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202520242023Top DX Goals in Australia
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42%35%42%Reduce operational inefficiency.
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36%33%33%Replace or upgrade legacy IT systems.
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31%37%40%Improve customer experience and engagement.
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31%30%35%Transform existing business processes.
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27%25%*Enhance employee performance / productivity.
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20%33%35%Increase / achieve innovation.
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20%27%*Gain competitive advantage..
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20%17%32%Bolster cybersecurity..
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19%15%19%Introduce new products or services.
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19%13%21%Increase speed to market of existing products or services.
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19%10%23%Introduce new business models / revenue streams.
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17%22%19%Improve employee experience.
Navigating the Complexities of Digital Transformation
Digital transformation efforts present significant challenges that organisations must strategically navigate. As companies strive to leverage new technologies and realise the value of enterprise transformation, they face numerous obstacles within increasingly complex technical and business environments. The complexity of current environments and siloed mindsets ranks first.
Lack of internal alignment has risen as a concern. Aligning digital transformation with business objectives and KPIs has also grown in importance, up three places from last year.
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202520242023Top Challenges in Australia
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181Complexity of current environment / Siloed mindset and behaviours.
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246Lack of internal alignment (digital vs. traditional business).
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36*Aligning digital transformation with business objectives / KPIs.
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495Change management and implementation complications / Aversion to risk.
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5107Creating a culture of continuous learning / Upskilling or reskilling workforce.
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6**High or unforeseen costs associated with digital transformation.
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7510Gaps in technical talent.
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838Lack of strategy around digital initiatives.
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929Security concerns and compliance constraints.
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107*Too many competing tech priorities.
PEOPLE, PROCESS AND TECHNOLOGY
The Digital Business transformation Framework:
of organisations report needing many new types of talent, or the need to completely revise the nature of their talent base.
People: Building a Modern Workforce for the Future
Technology skills gaps are not exclusive to the IT department; they transcend the entire organisation. Use of artificial intelligence, low-code/no-code development platforms, and data visualisation tools means every employee must be equipped with the right skills to be productive in a digital organisation.
To bridge skills gaps, companies need innovative and comprehensive talent strategies. This approach enables them to acquire and develop crucial skills to modernise their workforce.
organisations say it takes 10+ months to fill IT roles.
Process: Taking an Iterative Approach to Business Transformation
The strategic use of technology to innovate and scale business processes is a core tenant of digital transformation initiatives. Organisations must take an iterative approach, involving strategic planning, continuous design, prototyping, feedback loops and refinement. This approach ensures business outcomes are fully optimised to realise their value potential.
Technology: Transformation Enabled by the Cloud With AI-Driven Innovation
As digital transformation accelerates in 2025, organisations increasingly will use technology as a key competitive advantage. Cloud computing serves as the foundation of these transformation efforts, with cloud-native platforms and infrastructure as a service (IaaS) remaining essential for agility, scalability and innovation. Cloud-native platforms and IaaS included in the most impactful technology over the next 1 to 2 years, underscoring their vital role in enabling seamless operations and fostering innovation.
These technologies provide flexibility and scalability for businesses to adapt to shifting market demands, support hybrid work models and accelerate development cycles. Their widespread adoption reflects their ability to serve as a foundation for other transformative technologies, such as AI, automation and analytics.
Top five most impactful technologies for organisations over the next 12 to 24 Months
- Software as a Service (41%)
- Automation technologies (41%)
- Artificial intelligence and machine learning tools (37%)
- Generative AI tools (36%)
- Platform as a Service (PaaS) (36%)
Gen AI tools are the most likely to be piloted in 2025, with 29% of organisations experimenting with them. This enthusiasm stems from their potential to revolutionise content creation, enhance customer experiences and automate complex tasks. The fact that 5% of organisations have already scaled Gen AI to multiple units or across the enterprise signals its transformative impact. However, organisations must identify and define specific business outcomes for AI to get the expected ROI. These tools rapidly reshape workflows and offer personalisation solutions, advanced data analysis and real-time decision-making.
As digital transformation advances, organisations will prioritise technologies that provide both immediate productivity improvements and long-term scalability. Cloud-native platforms, IaaS and Gen AI tools are central to these initiatives, allowing businesses to innovate quickly and adapt to changing market conditions. By the end of 2025, the convergence of cloud computing, artificial intelligence and automation will create a more agile, efficient and innovative enterprise landscape.
state of artifical intelligence
AI Powered Transformation
Artificial intelligence is an essential driver of digital transformation, empowering organisations to innovate, enhance efficiency and assert their competitiveness in the market. As businesses confront the challenges of evolving market demands, AI—especially generative AI—emerges as a valuable tool for achieving strategic objectives.
Thirty-six percent of organisations intend to leverage Gen AI in 2025, accentuating its pivotal role in digital transformation strategies. This widespread adoption reflects a belief of AI’s capacity to unlock new value and optimise operations.
of organisations plan to ramp up AI-related expenditures in 2025.
Expanding process automation is a primary focus for organisations, directly aligned with the top goals of digital transformation. AI-driven solutions are being actively implemented to automate repetitive tasks, enhance decision-making and deliver real-time insights.
Primary Use Cases and Challenges of AI Technologies
As businesses intensify their investments in AI, decision-makers must establish robust infrastructure, data strategies and governance frameworks. By strategically embracing AI technologies, organisations can accelerate their digital transformation journeys and achieve concrete gains in productivity, agility and long-term growth.
TEKsystems' Tips to Digital Transformation Success
CONCLUSION
Mastering the Momentum
Digital transformation remains essential for businesses to succeed in a fast-changing market. Cloud computing, generative AI and automation technologies help improve efficiency, encourage innovation and focus on customer needs. Digital leaders take the initiative by using these tools strategically and connecting them to clear business goals to achieve measurable ROI.
Organisations face challenges in this process. Talent shortages, outdated technology and the change management struggles highlight why investing in people, processes and technology is crucial for ongoing transformation efforts. Companies must also balance short-term gains, like increased productivity, with long-term goals, such as building resilience and agility.
As you consider the insights in this report, understand that taking a systematic, outcome-focused approach to digital transformation can help your organisation grow and succeed in an increasingly complex and interconnected world.
About the Research Overview
TEKsystems conducted an online survey from November to December 2024 with 855 technology and business decision-makers. Respondents included members of the C-suite, company executives, vice presidents, directors and managers who have final decision-making authority and/or influence on their organisation’s digital transformation efforts. The sample includes a balance of decision-makers in enterprise IT and line-of-business functions in the United States, Australia, Canada, China, India, Singapore, Belgium, France, Germany, Ireland, Netherlands and the United Kingdom across a broad spectrum of industries.
Digital transformation is the strategic use of technology to innovate business processes, foster a forward-thinking culture and elevate customer experiences, all in response to shifting market demands.
Response details by market
- Asia-Pacific (n=220)
- Australia (n=60)
- China (n=59)
- India (n=51)
- Singapore (n=50)
About TEKsystems
We’re partners in transformation. We help clients activate ideas and solutions to take advantage of a new world of opportunity. We are a committed team working with over 6,000 clients across North America, Europe and Asia-Pacific. As an industry leader in talent solutions and technology services, we work with progressive leaders to drive change. That’s the power of true partnership. TEKsystems is an Allegis Group company.
