To remain competitive in the digital economy, enterprises need to constantly adapt, and that too successfully. Yet studies reveal that 70% of digital transformation projects fail, often because of unclear goals, misaligned teams, and resistance to change. However, to counteract these odds, many businesses have adopted the Objectives and Key Results (OKRs) framework to overcome these obstacles and ensure that digital initiatives are in line with company priorities and have measurable results.
What is Digital Transformation and Why it Fails
According to McKinsey & Company, ‘Digital transformation is the rewiring of an organization, with the goal of creating value by continuously deploying tech at scale’. Digital transformations began with the rise of the internet in the 1990s, it truly gained momentum in the 2000s with advancements in cloud computing, mobile technology, and data analytics. Over the past decade, it has evolved into a holistic and strategic shift for businesses, driven by automation, AI and other cutting-edge technologies.
Digital transformation is important for businesses to stay relevant, and normally always start with a strategy. While a significant number of organisations have undertaken digital transformation initiatives in the last decade, it is interesting to observe that only a small percentage (around 25% to 30%) have achieved successful outcomes, with the rest facing challenges.
While a well thought out strategy does give good objectives, it is identifying and monitoring key results where companies often fail. The second big reason is that almost 50% of the time estimated for transformation just goes into planning, and by the time business sees any real change, it is already 12 to 24 months over. By this time, significant amount of money, efforts, and resources are already consumed without any results that leads to frustration and fatigue for the business leaders. Some of the well-established project management methodologies like Agile or MSP only kicks in once the transformation moves from planning to execution.
Therefore, what we need is a solution/framework that can help organizations deliver benefits for business sooner. Whether the answer lies in following OKR methodology – let’s explore.
What Are OKRs and How They Drive Digital Transformation
Objectives and Key Results (OKRs) are a management strategy that defines objectives and tracks results. When applied in the context of digital transformation, OKR’s ensure alignment, focus, and accountability.
OKRs consist of two key parts:
- Objectives: What you want to achieve.
- Key Results: How you measure progress toward that goal.
OKRs offer digital transformation a clear framework by establishing challenging but attainable objectives and connecting them to quantifiable results. In large scale digital transformations, it is quite easy for goals to lose their exact meaning or purpose across different teams. OKRs align teams by establishing a common vision and measurable success criteria, ensuring that each employee understands their contribution to the overall goal.
OKRs effectively target key focus areas that play a vital role in the transformation. They align strategy and execution to bridge the gap between high level transformation goals and daily execution, ensuring teams are working towards measurable outcomes.
In addition, they drive focus and agility in a rapidly changing environment. OKRs help teams navigate digital transformation by maintaining focus on important initiatives and promotes data-driven decision making whilst iterating flexible cycles, which promotes agility and adapting to change. By breaking down objectives into measurable key results, it is easier to track progress and modify the approach as needed, which ensures teams remail agile and aligned.
Similarly, it encourages cross functional collaboration. Digital transformation thrives though collaboration between diverse teams, such as IT, marketing, and customer service. OKR’s effectively align these teams and provide a common framework and goal for them to work towards.
Case Study: Microsoft’s Cloud Transformation
A great example of OKRs in action is Microsoft’s transition from a typical software corporation to a cloud-first enterprise. Microsoft’s ambitious goal was to become a world leader in cloud computing. To support the successful implementation of this digital transformation, they relied on OKR methodology. Here are some of the Objectives and Key results that they pursued.
Conclusion
OKRs offer a methodical, outcomes-oriented approach to digital transformation, guaranteeing that projects stay strategic, quantifiable, and in line with overarching corporate objectives. Businesses like Microsoft, Google, and ING have shown that successful transformation is largely dependent on having specific goals and measurable outcomes. By leveraging OKRs, businesses can maximise digital investments, accelerate innovation, and maintain a competitive edge in an evolving digital landscape.
Sources:
- McKinsey & Company (2018):
McKinsey’s report on digital transformations highlighted that 70% of transformations fail to achieve their intended outcomes, which was a key finding in their study on the topic.- Source: McKinsey Digital – “Why digital transformations fail: Lessons from the leaders” (2018)
- McKinsey & Company (2024):
Digital transformation involves the fundamental rewiring of an organization to create value by continuously deploying technology at scale.
- Source: McKinsey & Company – “What is digital transformation?” (2024)
- Gartner (2020):
A survey by Gartner showed that only 16% of digital transformation projects were deemed a success, with many companies failing to meet their goals.- Source: Gartner – “Gartner 2020 Digital Transformation Survey”
- Harvard Business Review (2020):
Harvard Business Review published an article indicating that 80% of executives found their digital transformation efforts to be unsatisfactory or failed to deliver significant value.1- Source: Harvard Business Review – “Why Do So Many Digital Transformations Fail?” (2020)
- Capgemini Research (2021):
Capgemini’s research found that about 25% of organizations were satisfied with their digital transformation efforts, while others faced challenges in execution or struggled to realize value.- Source: Capgemini Research Institute – “The Digital Transformation Review: The Path to Successful Transformation” (2021)
- Microsoft Learn (2025):
Microsoft’s cloud transformation exemplifies the use of OKRs in digital transformation. The company’s goal was to become a global leader in cloud computing, and it utilized the OKR framework to guide its strategy.
- Source: Microsoft Learn – “Define Your Cloud Adoption Strategy Mission and Objectives – Cloud Adoption Framework” (2025)
Sophia Singla is an Intern at Rescon Partners, where she supports research and strategy development for clients across the technology, architecture, and engineering sectors. Currently studying a double degree in Business and IT, she brings strong analytical thinking, attention to detail, and communication skills to her work. Outside of her role, she actively seeks opportunities to build experience and apply her learning in real-world contexts.
