Across industries, “digital transformation” has become one of the most overused and misunderstood phrases of the last decade. Few leaders would dispute the need to modernize, automate, and digitize their operations. Yet the evidence tells us that up to 70% of transformations fail to meet their objectives.
At our recent roundtable, executives from banking, asset management, private equity, and venture capital shared hard-earned lessons from the field. Their insights reveal that transformation is as much about execution, culture and discipline as it is about the technology itself.
The short answer: yes, but only if done right.
For many firms, processes like KYC and onboarding remain too manual. Compliance teams spend hours reconciling data, sending email reminders, or chasing missing documents. Instead of re-engineering these processes, digital transformation projects often add another tool or dashboard, which increases complexity without reducing effort. The result is more cost, more silos, and less efficiency.
Compliance demands are not slowing down. Whether it is evolving AML directives in Europe, the SEC’s tightening rules in the US, or ESG reporting frameworks, firms are under pressure to ensure accuracy and transparency. The instinct is to bolt on tactical fixes, but these are fragile and quickly outdated. Leaders agreed that “compliance-by-design” should be the north star: workflows that are both efficient and regulator-ready from day one.
Onboarding may be seen internally as a cost center, but externally it is the first impression a client has of a firm. Investors, especially in venture capital, expect frictionless digital experiences. Even in private equity, where relationships are more traditional, slow or clunky onboarding creates reputational risk. As one roundtable participant put it:
“We’re asking clients for money, but making them feel like they’re applying for a passport.”
Generational shifts are shaping expectations inside and outside organizations. Younger employees want to work with modern systems, not spreadsheets. They are less tolerant of repetitive manual tasks and more likely to leave if firms do not modernize. At the same time, clients expect speed, automation, and transparency. Failing to meet these expectations creates both attrition risk and competitive disadvantage.
Not all clients are at the same level of digital maturity. For example, VCs often demand high-tech onboarding portals, while some PE firms prefer the comfort of email and PDFs. Straddling both can stretch internal systems and teams thin, forcing firms to juggle “dual-track” service models that are difficult to scale.
Global firms operate across multiple jurisdictions, business lines, and regulatory frameworks. What looks like a straightforward change in one geography often becomes a nightmare to scale elsewhere. This “complexity tax” is one of the reasons so many digital initiatives stall halfway.
Transformation programs often become political footballs. The bigger the initiative, the more stakeholders want to influence it. Instead of solving clear problems, projects drift toward consensus-driven compromises. In the words of one participant:
“The more visible the project, the less chance it has of delivering on time.”
Far too many programs work backward from a fixed deadline, such as a board date, an investor meeting, or a press release, rather than forward from realistic planning. Without resource alignment and phased delivery, these projects end up being rushed “checkbox transformations” that collapse under pressure.
For firms engaged in M&A, transformation efforts often fall victim to shifting priorities. Before acquisitions, uncertainty freezes investment decisions. After acquisitions, integration consumes resources. Transformation becomes an afterthought until inefficiencies accumulate to a breaking point.
Digital transformation is not a one-off technology upgrade; it is a long game that blends strategy, culture, and execution. The stories shared at our roundtable made one thing clear: failure usually is not about picking the wrong software, but about underestimating the human and operational factors that make change hard.
In a market where investors and regulators expect seamless, compliant, and data-driven interactions, firms that hesitate risk falling behind. Those that approach transformation as an ongoing capability, not a project with an end date, position themselves to thrive. The firms willing to rethink processes, empower talent, and hardwire agility into their operations will be the ones still standing when the next wave of disruption arrives.