Despite paying lip service to “digital transformation,” the majority of senior IT managers at large companies aren’t fully embracing next-generation data center technologies, according to a study by Enterprise Strategy Group (ESG).

Only 5 percent of the 1,000 organizations surveyed in the ESG 2017 IT Transformation Maturity Curve study fell into the “transformed” category. For this study, commissioned by Dell EMC, ESG defined transformed companies as those furthest along in adopting next-generation data center technologies, such as scale-out storage systems and converged/hyper-converged infrastructure.

In other words, 95 percent of survey respondents are at risk of falling behind a smaller group of industry peers that are transforming their IT infrastructures, processes, and delivery methods.

Seventy-one percent, however, agreed that IT transformation is essential to ongoing business competitiveness.

Meanwhile, 12 percent of organizations fell into the “legacy” category, meaning they fall short on many – if not all – of the dimensions of IT transformation. ESG classified 42 percent of respondents as “emerging,” or showing progress but having minimal deployment of modern data center technologies, and 41 percent as “evolving,” or having moderate deployment of such technologies and IT delivery methods.

Embracing these technologies also leads to increased profitability, according to the study. Ninety-six percent of transformed companies exceeded revenue targets last year, more than two times the least mature companies.

Additionally, the transformed companies are seven times more likely than their least mature counterparts to view IT as a competitive differentiator.

Adopting next-generation data center technologies can improve the agility and responsiveness of infrastructure provisioning, IT project delivery, and application development, ESG said. The study found:

• 54 percent of all respondents use converged or hyper-converged infrastructure to support applications
• 58 percent of all respondents have adopted scale-out storage systems in some capacity
• About 50 percent of respondents are committed to software-defined as a long-term strategy and have begun to implement, evaluate, or plan for software-defined technologies

According to the study, modern IT processes such as self-service provisioning capabilities, running IT like a public cloud and use of DevOps methodologies, can be an attribute of a transformed company. The study found:

• 26 percent of all respondents have “extensive” or “established” self-service capabilities
• 65 percent of all respondents have made “excellent” or “acceptable” progress toward providing end users with the same ability to provision IT resources that they can get from a public cloud provider
• 43 percent of respondents claim “extensive” or “good” adoption of formal DevOps principles and best practices

Database services vendors are increasingly noticing this trend toward cloud deployment and are stepping up their cloud, hybrid-cloud, and multicloud offerings, according to an ESG blog. The blog highlights Teradata and Informatica as vendors that are building up their cloud capabilities. Large database vendors including Amazon Web Services (AWS), Microsoft, Oracle, and IBM are increasing their offerings as well.

“As all these companies move to meet demand for cloud databases and data warehouses, demand will see the maturity and increase again, making a nice self-fulfilling prophecy,” wrote ESG Analyst Nik Rouda.