The balanced transformation: 83% of CPG success stories achieve human-technology synergy

In the race to digitize, CPG companies are investing an average of $8.9 million per transformation project, yet 37% of these initiatives still fail. VML's groundbreaking research reveals a critical insight: the most successful transformations aren't just about implementing new technologies—they're about putting people at the center of change.

The data is compelling: 83% of CPG transformation leaders agree that successful digital transformation is as much about human beings as it is about technology. This human-centric approach isn't just a philosophical stance—it's backed by hard evidence showing that neglecting the people side of transformation directly correlates with project failure.

The research identifies several key dimensions where the human element proves decisive. A striking 72% of CPG transformers report that project failures stem directly from inadequate change management around people. Meanwhile, 68% cite different objectives across teams as major barriers to success.

These findings expose a fundamental disconnect in how many organizations approach transformation. While technology investments dominate budgets and attention, the research shows that transformation success hinges on factors like cross-team alignment, change management, and workforce preparation.

The hidden costs and organizational challenges

The financial implications are significant. With CPG companies spending nearly $9 million per transformation project, the 37% failure rate represents billions in wasted investment across the industry. According to the research, 64% of respondents admitted that because changing technology can be so expensive and time-consuming, there is often insufficient budget and time for change management around people and processes.

This budgetary imbalance creates a self-fulfilling prophecy: organizations invest heavily in technology while underinvesting in the human factors that determine whether that technology will be successfully adopted. The result is a cycle of expensive implementations that fail to deliver their promised value.

The research also reveals that organizational structure plays a crucial role in transformation success. With multiple stakeholders involved—from IT and marketing to operations and senior leadership—coordination becomes exponentially more complex. More than half (52%) of transformers say their projects have been characterized by frequent conflicts between teams. This lack of unified vision creates friction that can derail even the most promising initiatives.

Many CPG organizations persistently misconceive digital transformation, with the research showing that it's frequently approached as merely a technology project when it is actually much broader in scope. This technology-first mindset often leads to neglecting critical people-focused elements that determine whether new systems will be embraced or rejected.

A new blueprint for CPG transformation success

For CPG marketers looking to improve their transformation outcomes, the research points to three essential strategies:

Balance technology investments with process redesign. The 82% of respondents who said that digital transformation is as much about new processes as new technology highlight the need for a holistic approach that addresses both elements simultaneously.
Protect dedicated change management budgets that are separate from technology costs. By ring-fencing funding specifically for the human side of transformation, organizations can ensure these critical activities aren't sacrificed when technology implementations run over budget.
Establish unified transformation governance through central transformation offices that align goals across departments. This approach addresses the 68% of respondents who cite different objectives across teams as barriers to success.

The message from our research is clear: successful digital transformation in the CPG sector requires a fundamental shift in approach. By putting people at the center of digital transformation plans—addressing their needs, concerns, and working patterns—CPG brands can dramatically improve adoption rates and realize the full potential of their technology investments.

The research highlights a crucial lesson learned across successful transformations: technology alone doesn't transform businesses—people do. Organizations that focus as much on change management as they do on implementation have seen their success rates improve dramatically.

In an era where digital transformation has become an existential imperative for CPG companies, this people-first approach may be the difference between the transformations that succeed and the ones that fail.