A new research commissioned by software titan Microsoft said business organizations in Asia Pacific need to speed up their digital transformation to take full advantage of the region’s growth.
The study, “Unlocking the Economic Impact of Digital Transformation in Asia Pacific”, involved 1,560 respondents in 15 markets and was conducted by analyst firm IDC.
The report forecast that by 2021, a large chunk of the GDP (gross domestic product) of Asia Pacific countries would be derived from digital products and services.
It also mentioned that the contribution of digital technology to the GDP of the Philippines would grow from only 3 percent in 2017 to 40 percent in 2021.
The report emphasized that Philippine organizations stand to gain these benefits from digital transformation: higher profit margins, greater profitability, increased revenue from new products and services, improved customer loyalty, and cost reductions.
Not all businesses, however, would benefit equally. Andrea Della Mattea, president of Microsoft Asia Pacific, identified two groups of organizations in the study — Leaders and Followers.
Only 7 percent of Philippine organizations are Leaders. At least a third of these businesses’ revenue is derived from digital products and services, and they have full or progressing digital transformation strategies. In fact, 48 percent of Filipino Leaders have implemented a full digital strategy.
The remaining 93 percent are Followers, or organizations whose revenues from digital avenues comprise less than 20 percent of their total revenue, and only 17 percent of these businesses have a full digital strategy.
Besides that, the research indicates Leaders are currently experiencing double the aforementioned benefits of Followers. This difference will only grow more pronounced by 2021, the report said.
“They (Leaders) will continue to see a greater benefit than the Followers by investing in their digital transformation strategies,” Della Mattea stressed.
Hans Bayaborda, managing director of Microsoft Philippines, echoed the same statement. “In Microsoft’s perspective, accelerating their (Follower’s) digital transformation journey should happen now.”
Bayaborda said organizations ought to accelerate their digital transformation by creating a digital culture of collaboration, gathering and leveraging data to create a digital ecosystem, and embracing the technological micro-revolutions.
The need for organizations to retrain individuals and organizations with future-ready skills was also brought up.
Jubert Alberto, country head of IDC Philippines, acknowledged that there would be job “redundancies along the way.” He also emphasized though, that technology would allow for the creation of new jobs, and business should invest in upskilling their workers for the modern digital business models.