The ongoing COVID-19 pandemic has exposed significant flaws in the tech practices of Australian businesses, leading to many losing customers, a new report has found.

A survey of 1,200 business decision-makers around the world, including 206 from Australia, found that many local companies believe they have lost customers due to poor communications and were unprepared for a bigger reliance on technology with mass working from home.

A global study from software company Pegasystems was conducted by research firm Savanta on the impact of the pandemic on businesses and their ability to adapt during a crisis.

Half of the surveyed Australian businesses lost customers during the pandemic due to poor communications, much higher than the global average of 36 per cent.

Further, 85 per cent of businesses believed the crisis had exposed significant gaps in their businesses and digital transformation efforts, with many of these mistakes due to lagging technology.

Of the surveyed Australian firms, 55 per cent worry they let customers down during the pandemic, 64 per cent admitted they should have done more to help their customers and 56 per cent sent a message to customers that was poorly received and damaged their reputation.

The survey found that many Australian businesses are overestimating the effectiveness and maturity of their digital transformation efforts, with the COVID-19 crisis shining a spotlight on shortcomings.

While more than 80 per cent of the survey respondents were well into their digital transformation efforts and more than 40 per cent said these initiatives were in “advanced stages”, the vast majority of companies (85 per cent) admitted that significant gaps had since been identified.

“The negative outcomes have served as a reality check for business leaders as they’re vowing not to let their lagging technology infrastructure put them at risk for the next crisis,” the report found.

In response to this, more than 80 per cent of the surveyed Australian companies said they had now been forced to accelerate their digital transformation plans, more than 70 per cent will now increase the priority level of digital transformation internally and more than 60 per cent will increase their investment in digital transformation.

If this goes well, 98 per cent of respondents are confident they will be better prepared to face a similar crisis if one emerges in the next two years.

Pegasystems chief technology officer Don Schuerman said the data shows that digital transformation should be a priority for all Australian businesses.

“What this research makes clear is that digital transformation can no longer be ‘nice to have’ for today’s businesses,” Schuerman said.

“Even those that thought they were digitally advanced now realise they’ve only scratched the surface. Organisations need to re-examine every part of their business for digital readiness or face consequences regardless of whether another crisis of this magnitude happens again or not.”

For future projects to better prepare for another crisis, the most popular are AI-driven analytics and decisions, with nearly half of respondents saying they were looking to pursue this, followed by AI-driven predictive analytics, cloud-based systems and customer messaging applications.

On the positive side, nearly 80 per cent of those surveyed said that working remotely during the pandemic had been successful and would likely continue it in some form once the crisis ends.

The COVID-19 crisis has put pressure on SMEs in two ways, with many having to move their entire workforces to work remotely, while also moving some of their operations online. This has led to concerns about an increased cybersecurity risk and issues over the handling of data.