How to tackle business transformation challenges in the Age of AI

In recent months, my conversations with clients across diverse industries have gravitated to a pervasive theme: the need for business transformation in an AI-driven world. The challenge is finding ways to modernize, innovate and grow while keeping costs and risks in check, and this balancing act has become precarious. The C-suite leaders I've talked to recently are focused on changing their processes, products and platforms to become faster and more flexible. They are looking to lead their teams through this change to embrace the many benefits of AI. According to our study, Global GenAI Report: How organizations are mastering their GenAI destiny in 2025, while 83% of respondents claim to have a well-defined GenAI strategy in place, 51% have yet to align this strategy with their business plans, underscoring the urgency to modernize. Business transformation in the age of AI demands organizations adapt, and do so quickly.

Key challenges of business transformation in the AI era

There are three primary challenges of modern business transformation that enterprise leaders are actively addressing.

1. Enabling enterprise innovation while sustaining profitable growth: Customers expect fast and frictionless experiences, while businesses need to lower operating costs and grow. So, funding innovation initiatives can be a barrier for many organizations. While innovation is vital for long-term success, it may not increase earnings per share or generate immediate financial returns. Innovation efforts must be affordable to align with long-term business goals.
2. Balancing legacy and modern technology in fragmented environments: I understand that many of our clients are navigating a complex mix of modern and dated IT assets, including multiple clouds, custom applications and proprietary data centers. These old systems often have trouble supporting new technologies like GenAI, EdgeAI, Private 5G and more. This is especially true where technology is not integrated because of acquisitions or other operational silos.
3. Driving human adoption of change: The integration of cutting-edge technologies will inevitably transform the cultural DNA of organizations. Many organizations promote values like innovation and collaboration but still operate in silos, leading to resistance when introducing new approaches to innovation and business transformation. Changing how employees succeed in the Age of AI is a formidable challenge. It’s not about simply adopting a new tool. Digital technologies can alter processes and behaviors — and change management and training is critical to empowering employees to succeed in the next phases of human-technology interaction. According to our report, 96% of respondents are considering how GenAI can streamline future employee workflows and support processes. However, 67% of respondents said their employees lack the necessary skills to work with GenAI. About half are planning employee education and training to increase GenAI adoption, highlighting the importance of proactive measures to bridge this skills gap.

Six imperatives for successful business transformation

Navigating these challenges is daunting to say the least, but there is a viable path. The team at NTT DATA has identified six business transformation imperatives that enable organizations to leverage an optimal mix of people and machines to increase revenue, reduce costs and minimize risks. These principles will help organizations embrace this new era with confidence:

1.  Align technology with business strategy to meet AI-era demands: IT investments must be intentionally designed to yield specific business outcomes with maximum return. For example, finance and healthcare organizations can integrate technologies to directly affect measurable outcomes such as enhanced customer experience or better patient outcomes. These are the types of transformation goals in an AI-driven business environment that generate ROI and can drive sustainable growth.
2.  Create customer-centric experiences to boost revenue: Technology can supercharge personalized services in ways that drive greater satisfaction and loyalty. The key is placing humans at the center of your strategy. Creating experiences for a world shaped by AI ensures that solutions resonate with employees and customers, fostering adoption, engagement and satisfaction. Then, you can harness the right tools and innovation to create superior service and frictionless, human-centric experiences that ultimately drive revenue growth. For instance, in retail and hospitality, AI can instantly provide personalized recommendations and services that boost satisfaction and loyalty, which in turn supports revenue growth.
3.  Automate end-to-end processes to boost efficiency: Improving productivity in an AI age is top-of-mind for many executives. Businesses need to identify and automate repetitive and manual processes so that employees then can focus on higher-level and more creative work while the business increases productivity and innovation. Manufacturing and logistics firms have benefited greatly from automating supply chains and production lines. Outcomes include lower costs, higher efficiency, and a greater focus on innovation and quality control.
4.  Establish new workflows for productivity in the AI age: Goldman Sachs Research expects AI will spark measurable growth in US GDP in 2027 and increase growth in other economies around the world thereafter. To participate in this economic surge, organizations must reimagine traditional job roles and build workflows capable of boosting productivity in an AI-driven world. AI can help businesses like telecommunications and media deliver content and keep their networks running. This helps them be more productive and create a culture that accepts technological changes. However, changes of this magnitude work best when implemented in tandem with formal change-management initiatives. For more insights on aligning teams and AI, explore Cultivating Human-AI Harmony.
5.  Reduce legacy debt to enable modernization: In NTT DATA’s most recent Innovation Index, 86 percent of business and tech leaders surveyed said their IT capabilities were outdated. Clunky systems drain productivity, waste resources and stall innovation. By tackling this head-on, organizations can create time and money to focus on what matters most. For example, insurance organizations, government and education institutions typically run many outdated applications and systems that impact user performance, as well as organizational efficiency, productivity and responsiveness. Reducing legacy debt makes it easier — and even possible — to adopt new technologies to improve competitive advantage and ensure mission readiness.
6. Shift CapEx to OpEx to increase operational flexibility: Technology estates – the cumulative IT assets of an organization, including data centers and fixed networks — are capital intensive and weigh heavily on the balance sheet. The modernization of these assets can include a shift to a co-location or a cloud services model. This lets an enterprise exit the data center business by partnering to convert capital expenditures into operating expenses. This approach helps organizations consolidate vendors and strengthen disaster recovery capabilities, while supporting scalability and saving money.

It’s never easy to change your people, processes, products and platforms to become faster and more adaptable. By working now to address these challenges and tackle these key imperatives, executives can modernize, innovate and grow their organizations while keeping costs and risks in check—which is integral to success in the age of AI.

NTT DATA is the world's only full-stack technology company. We use our industry knowledge combined with technology and innovation solutions to help organizations make more money, save money, and reduce risk by using the best mix of people and machines.

Want to learn more about how NTT DATA is helping businesses adapt in an AI-driven world? Read our latest press release, Playtime Is Over for GenAI, here.